RQFII unlikely to proceed without services pact: FSC
The Financial Supervisory Commission (FSC, ) said chances are low that it can renegotiate terms of a cross-strait yuan investment scheme so that the program can proceed independently from the stalled Cross- Strait Service Trade Agreement ( ).
“Decoupling the Renminbi Qualified Foreign Institutional Investor (RQFII) from the CrossStrait Service Trade Agreement would be a difficult task,” FSC Chairman William Tseng ( ) said yesterday. Tseng reiterated yesterday that an annual cross-strait meeting of financial regulators will proceed as usual this year, despite an impasse in the Legislature over the CrossStrait Service Trade Agreement.
The financial regulators’ summit will open in Taipei as early as the third quarter and no later than the fourth, Tseng said yesterday at a financial industry forum.
The China Security Regulatory Commission ( ), China Banking Regulatory Commission ( ) and the China Insurance Regulatory Commission ( ) will each send a delegation to Taipei, he said.
The summit dates and issues on the agenda are still under study, Tseng said, adding that talks are unlikely to result in an early green light for the RQFII program.
As part of the Cross-Strait Service Trade Agreement signed in 2013, the Chinese government had agreed to let qualified Taiwanese investors repatriate yuan through its financial markets.
The services pact, which triggered a 24-day student demonstration, has not been ratified and has also delayed the implementation of the RQFII program. The pact has not yet seen legislative review and its fate remains uncertain.
China has offered about 770 billion yuan in global RQFII quotas; Australia, France, Singapore and Hong Kong already have quotas.
Initial reports state that China is considering a 100 billion yuan quota for Taiwan, the largest amount allocated to any economy outside of Hong Kong, which has a quota of 270 billion yuan.
Ahead of the annual summit of cross-strait financial regulators, members of Taiwan’s financial industry said they hope that the FSC can renegotiate terms of the yuan investment scheme and open up the 100 billion yuan opportunity ahead of the stalled pact.
On Monday, the FSC chairman had said that “when there is a meeting, there is an opportunity for a breakthrough.” It is particularly meaningful that the annual cross-strait financial talk is continuing as usual, he said.