China is shying away from one of its few overseas investment schemes, Reuters reports in an exclusive, limiting new membership approvals as fears in Beijing of capital outflows rise.
According to industry sources, officials have also asked existing participants to be “tight-lipped” regarding discussing the program in public.
The scheme, known as the Qualified Domestic Limited Partnership (or QDLP) program, allows funds based in China to raise capital from domestic investors for offshore investments.
The government’s hesitancy to issue new licenses is at odds with statements made earlier this year. The State Administration of Foreign Exchange (SAFE) said in April that it planned to expand the program’s total quota. Global financial institutions such as JPMorgan, BNP Paribas and Allianz all joined the scheme in 2018.
There has also been a slowdown in a similar scheme, the Qualified Domestic Institutional Investor (QDII) program. SAFE data show that new quotas for QDII have not been issued for three months.