MNI BRIEF: China To Help Firms Invest Overseas

The People’s Bank of China and the State Administration of Foreign Exchange will support overseas investment and financing by easing foreign debt restrictions and encouraging banks to diversify yuan forex derivatives, officials told a briefing on Wednesday.

Wang Xin, director of the PBOC’s Research Bureau, said Shanghai is piloting rediscounting facilities to support yuan cross-border trade refinancing. Additionally, banks will be supported in developing specialised hedging guarantee products, with fiscal subsidies provided to offset guarantee fees, he said. 

SAFE official Chen Zhiwei said the regulator will streamline foreign debt registration management and optimise cross-border guarantee procedures.

Su Yun, an official with the PBOC Shanghai Headquarters, said Shanghai will relax foreign debt rules, allowing qualified small and medium-sized high-tech enterprises in pilot zones to borrow foreign debt within specified quotas. The scope of cross-border financing facilitation pilots will be expanded, enabling eligible Shanghai-based high-tech firms, and tech-oriented SMEs to borrow foreign debt up to USD10 million equivalent, he said. (See MNI INTERVIEW: China To Facilitate O/S Investors-PBOC Official)