CNH Tracker-China quickens pace for linking domestic and global markets

jueves 28 de mayo de 2015 02:52 GYT

By Michelle Chen

HONG KONG May 28 (Reuters) - China this week pushed ahead efforts to link its domestic markets with global peers by launching a joint venture in Germany to provide a wide range of yuan-denominated products to European investors.

Deutsche Boerse agreed to set up a venture with the Shanghai Stock Exchange and China Financial Future Exchange to develop Chinese shares and ETFs for investors outside mainland China.

Shanghai Stock Exchange and Deutsche Boerse will each own 40 percent and China Financial Futures Exchange 20 percent of the venture, to be named "China Europe International Exchange" and incorporated in Germany.

It is a big step after China assigned Bank of China as the yuan clearing bank in Frankfurt and granted an 80 billion yuan ($12.90 billion) Renminbi Qualified Foreign Institutional Investor (RQFII) quota to Germany last year.

The latest move is also a bold attempt to expand the yuan's footprint beyond Asia without participation of Hong Kong, a pioneer in developing offshore yuan market and a trial platform for capital account liberalisation reforms.

"The offshore trading platform set up by the three exchanges will further promote the two-way opening up of China's capital market, enrich the product line of the offshore RMB market and accelerate the pace of Renminbi internationalisation," said Gui Minjie, Shanghai Stock Exchange chairman.

European investors still have few channels to buy yuan-denominated products. Last year, Chinese asset management firm E Fund Management (Hong Kong) tied up with London-based ETF Securities to list an exchange traded fund (ETF) on the London Stock Exchange, Deutsche Boerse and NYSE Euronext Amsterdam.

Now, China has entered an era of mutual market access, rolling out pilot schemes such as the Shanghai-Hong Kong stock connector as it shows determination to have its currency included in the International Monetary Fund's SDR.   Continuación...