Outbound Lending and Inbound Investment in Renminbi — Liberalising Rules with Unremoved Hurdles

Abstract

Internationalisation of Renminbi or yuan, the Chinese currency, is a clear policy and irreversible direction of the Chinese government. It was pledged by the ruling Communist Party in its 18th National Congress in November 2012 to further promote free movement of capital in and out of China for investment purposes and make the exchange rate more market based. Elsewhere, this author has deeply discussed the reform of China’s outbound investment regime in order to encourage more Chinese investors to invest overseas. This article focuses on the other two perspectives of the PBOC’s roadmap to relax capital controls, that is, offshore lending in Renminbi and RQFII Scheme.

Keywords: Offshore Lending in Renminbi, RQFII Scheme