Beijing seems to be loosening its grip on personal wealth leaving the country. A two-year suspension on foreign firms raising money in the country for overseas investment is set to be lifted.
Introduced in 2013, the Qualified Domestic Limited Partnership (QDLP) program allows foreign fund managers to raise money from high net-worth Chinese investor, and invest the cash overseas. The fund-raising is carried out through a wholly-owned onshore fund management company and within a set quota.
In 2015, U.S.-based Blackrock became the first traditional asset manager to receive a QDLP licence, joining a handful of other global funds, including Man Group and Och-Ziff Capital Management Group
Suspended After Crash
Then, in 2015, the program was suspended after China’s stock market crashed and lost around 40 percent of its value. Now, «Reuters» reports that China could lift the suspension as early as June.
One source said that authorities will be a «little cautious,» granting only around half a dozen licenses. The quota of funds investable abroad will be slashed from $100 million per manager to between $50 million and $75 million this time round.
The move comes as Beijing shows more flexibility with its economic foreign policy, after easing its crackdown on capital outflows and a weakening of the dollar.
