According to a report from the Wall Street Journal, China has approved two domestic fund managers to offer products in the U.S. that for the first time would give investors there indirect access to shares traded in Shanghai and Shenzhen, a significant move to further open the country's capital markets and globalize its currency, a person with direct knowledge of the matter said Thursday.
China's securities and foreign-exchange regulators recently gave joint approval for Bosera Asset Management Co. and Harvest Fund Management Co. to sell exchange-traded funds linked to China's yuan-denominated A shares in the U.S., said the person, who declined to be named.
At present, foreign investors' access to the domestically traded A-share market is limited to those under the so-called Qualified Foreign Institutional Investors and Renminbi Qualified Foreign Institutional Investors programs with predetermined quotas.
The ETFs offered by Bosera and Harvest will be listed on the New York Stock Exchange, said the person.
It is the first time China has allowed local fund managers to offer mutual funds outside Hong Kong, in a move that could pave the way for Chinese fund managers to offer similar products in the global markets, including the U.S., the person added.
The launch of the two ETFs falls under the so-called Renminbi Qualified Foreign Institutional Investors program in China that allows offshore yuan to be invested in the country's capital markets, the person said.
