China raises limit on securities firms

BEIJING - Reuters

Investors monitor stock prices at a securities firm in Hefei, east China. The country has raised the limit on foreign ownership in joint venture securities firms. AFP photo

China has agreed to raise to 49 percent the limit on foreign ownership in domestic joint venture securities firms and allow these brokerages to trade commodities and financial futures, a senior U.S. official said on Friday.

The move will allow foreign partners in domestic joint ventures to raise their stakes from the present 33 percent, while the expansion of their market activities represents a further step in the diversification and liberalization of China’s capital markets.

“It will provide important opportunities and again help to strengthen China’s capital markets,” said the U.S. official, speaking to reporters on the sidelines of the fourth Strategic and Economic Dialogue between the United States and China, being held this week in Beijing.

The official also said that China had agreed to start negotiations on reforms to export credit financing in the summer, and that Beijing was willing to make its state-owned enterprises start paying dividends at a similar rate to those typically paid by internationally listed companies.