Home / Business / News Tools: Save | Print | E-mail | Most Read | Comment
China simplifies rules on forex use
Adjust font size:

China's foreign exchange regulator said Wednesday it would loosen its controls on overseas investment procedures and foreign exchange management of domestic companies to boost outbound investment.

In a statement on its website, the State Administration of Foreign Exchange said a regulation, which will take effect on Aug.1, would simplify the examination and approval procedures for domestic companies with overseas investment plans.

Domestic companies would be allowed to register the source of their foreign exchange financing after their investment overseas instead of obtaining approval beforehand, according to the regulation.

The regulation would also allow domestic enterprises to finance overseas investment with domestic foreign exchange loans, purchases of foreign exchange with yuan, their own foreign currency funds and profits gained abroad.

Domestic companies would be able to transfer funds abroad before their overseas projects were established, after gaining approval from SAFE. The ceiling rate was 15 percent of the total project investment.

The SAFE would also improve supervision over overseas investment and step up supervision and management over the foreign exchange used in China's direct investment overseas.

The draft of the regulation had been posted on the SAFE website to solicit public opinion from May to June.

The regulation was aimed at offering more freedom to domestic companies on their forex use, investment and financing and to encourage them to "go out of China", said Liu Guangxi, director of the SAFE's capital account management department.

"Successful overseas investment could help domestic companies to expand their markets, providing solutions to overcapacity and weak internal demand," said Zhang Qizuo, vice president of the Sichuan-based Chengdu University.

The regulation would increase outbound investment and encourage more foreign exchange uses, so as to relieve pressure brought by China's rapid expansion of forex reserves, said Liu.

China's foreign exchange reserves hit a record 2.13 trillion U.S. dollars at the end of June, the People's Bank of China said on its website Wednesday.

(Xinhua News Agency July 16, 2009)

 

 

Tools: Save | Print | E-mail | Most Read Bookmark and Share
Comment
Pet Name
Anonymous
China Archives
Related >>
- China forex reserves top US$2.13 trln
- Forex regulator encourages China's 'capital export'
- China applies golden touch to diversify forex reserves
- SAFE to take tougher line on forex accounts
- China to take stable stance in forex investment
- China forex reserve investments remain profitable
June 7 Tokyo 2nd China-Japan High-Level Economic Dialogu

June 30 Shanghai 2009 Automotive Engine Technology Seminar

September 8-12 Xiamen China Int'l Fair for Investment and Trade
- Output of Major Industrial Products
- Investment by Various Sectors
- Foreign Direct Investment by Country or Region
- National Price Index
- Value of Major Commodity Import
- Money Supply
- Exchange Rate and Foreign Exchange Reserve
- What does the China-Pakistan Free Trade Agreement cover?
- How to Set up a Foreign Capital Enterprise in China?
- How Does the VAT Works in China?
- How Much RMB or Foreign Currency Can Be Physically Carried Out of or Into China?
- What Is the Electrical Fitting in China?