Shanghai is dedicated to further opening up two-way financial investment with multiple measures like further promoting the Qualified Foreign Limited Partner (QFLP) and Qualified Domestic Limited Partner (QDLP) pilot programs, in an effort to accelerate building the city into a global asset management center, according to a document released by the local government on Tuesday.
The city will promote foreign institutions to participate in the QFLP pilot program to manage domestic yuan funds and encourage qualified domestic institutions to become involved in the program.
Under the scheme, QFLP pilot institutions will be encouraged to carry out investment in multiple sectors including domestic non-listed company equity, private placement and mezzanine funds of listed companies and venture capital funds.
Shanghai will support well-known overseas asset management institutions and qualified domestic institutions to apply for the QDLP, and support such pilot institutions to invest in sectors like overseas private funds, equity and creditor's rights of non-listed enterprises, securities market, bulk commodities and financial derivatives.
Shanghai will also seek to encourage foreign-funded asset management institutions to use one entity to subscribe for QDLP and the whole foreign-owned enterprise private fund manager (WFOE PFM) program.
To boost cross-border two-way investment management, the city will also support pilot institutions to set up global or regional management centers in the city, and encourage asset management institutions in the city to establish, purchase and participate in asset management institutions overseas.
Moreover, residents will be able to assess cross-border financial management as the city will explore ways to establish such channels by deepening the Bond Connect scheme to allow investors from the Chinese mainland and overseas to trade in each other's bond markets, Shanghai-Hong Kong Stock Connect and Shanghai-London Stock Connect programs, according to the document.