Multinational Central Banks; Approved To Enter A-Share Market

　　 State Administration of Foreign Exchange Statistical data released yesterday showed that multinational central banks have recently been approved the investment quota of qualified foreign institutional investors (QFII), including the Bank of Thailand and the Bank of Korea. The investment quota approved by the central banks of both countries is $300 million. This means that the central banks of these countries can access China's capital markets for investment, including the A-share market and China's bond market.

　 32 QFIIs have been added this year

According to the data of SAFE, since March, SAFE has approved the QFII investment quota of 12 institutions in total, and approved the investment quota of 10 institutions on March 9 alone. Since this year, the State Administration of Foreign Exchange has approved 23 QFII investment quotas totaling US $2.91 billion. As of March 9, the State Administration of Foreign Exchange had approved 129 QFII institutions (excluding the two institutions whose quotas have been cancelled) with a total investment quota of US $24.55 billion.

Kuwait obtained QFII line

The latest news yesterday afternoon, the Chinese government has given Kuwait Sovereign investment funds ——- The Kuwait Investment Authority (KIA) has an initial investment quota of US $300 million, allowing it to purchase RMB stocks and bonds, so that the institution can further diversify its investment. It is said that the Kuwait Investment Authority has previously applied for an investment quota of US $1 billion. The China Foreign Exchange Administration may give the Kuwait Investment Authority the opportunity to increase the investment quota every month until it reaches the maximum limit.

As one of the world's largest exporters of crude oil (106.85,0.51,0.48%), Kuwait has more than 290 billion dollars in sovereign wealth funds. Although Gulf funds have always been fond of investing in the European market, with the slowdown of European economic growth, many funds have begun to target other regions such as Asia.

　 Japan is allowed to buy Chinese government bonds

According to Xinhua News Agency, Finance Minister Azumi said on the 13th that with the permission of the relevant Chinese authorities, Japan was allowed to purchase up to 65 billion yuan (equivalent to 10.3 billion dollars or 845 billion yen) of Chinese government bonds. This is the first time that Japan has announced the specific amount of Chinese government bonds it is allowed to purchase. Azumi said that this is the "appropriate purchase scale".

Azumi said that it will take several months to prepare some technical procedures for purchasing Chinese government bonds. Japan will then judge the timing of purchasing Chinese government bonds according to market trends, and it is appropriate to purchase Chinese government bonds in small amounts at the beginning.

　　 QFII's heavy position in Chinese stocks

QFII has always maintained a high interest in China's capital market. According to the data previously released by the SAFE, although the overall domestic securities market showed a downward trend in 2011, QFII institutions still maintained a high proportion of stock investment. By the end of 2011, the proportion of stock assets in the total assets of QFII was still as high as 70%.