China has issued draft proposals for plans to raise the amount that individual foreign institutions can invest in the mainland's stock markets. The new QFII limit would increase to USD1 bn, from the current USD800m, according to the the State Administration of Foreign Exchange.

 

The move is being interpreted as a way to boost China's flagging stock market, which fell more than 20 per cent last month - the largest monthly drop since October. The benchmark Shanghai index was the world's worst performing market in August.


"The revised rules are aimed at attracting medium- and long-term investments, facilitating investment operations and risk control, and improving management and monitoring of capital transactions," SAFE said in a statement. It added, however, that the overall USD30 bn investment quota won't be changed "because less than USD15 bn of the amount has been used so far," said a SAFE official.
 

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