China lifts foreign ownership limits on financial firms

China lifts foreign ownership limits on financial firms

BEIJING (Reuters) – The Chinese government on Friday said it will raise foreign ownership limits in domestic financial firms, a long-anticipated step that grants greater access to overseas investors into the Asian giant’s financial services market.

The move, announced by vice finance minister Zhu Guangyao, comes a day after U.S. President Donald Trump reiterated calls for better access to Chinese markets in meetings with Chinese President Xi Jinping.

 The changes include raising the limit on foreign ownership in joint-venture firms involved in the futures, securities and funds markets to 51 percent from the current 49 percent. They will take effect immediately following the drafting of specific related rules, Zhu told a news conference.

The foreign business community welcomed the news but urged caution until it was clear how rules would be implemented.

“Financial services further opening definitely has been high on our list,” said Ken Jarrett, President of American Chamber of Commerce in Shanghai.

“It’s a step in the right direction. We’ll have to see the detailed rules. In China you always have to pay attention to the fine print to see how quickly it moves, but to finally ease up on the cap is something that is welcome.”

A JPMorgan spokesperson said the firm “welcomes any decision made by the Chinese government that looks to liberalize its financial sector further.”