Sep 30, 2019 - World

China seems unfazed by U.S. threats to limit investor access

President Trump holding a sign with China on it.

Illustration: Lazaro Gamio/Axios

China appears unbothered by news the Trump administration is considering limiting U.S. investors’ portfolio flows into the country.

What's happening: China has been opening its capital markets to foreign investment, and over the past 8 years money flowing into China's stocks and bonds has grown 6-fold to nearly $1.3 trillion, per Wind Information data shared by Seafarer Funds.

  • Americans are responsible for nearly half of that total, scooping up $535 billion worth of Chinese assets.

Yes, but: China has opened up the markets largely as a show of good faith to U.S. and European investors and index makers who want access to its high-yielding bonds and fast-growing companies.

  • Further, capital flows from U.S. and other foreign investors has slowed significantly this year, largely as a result of the trade war.

What's next: China says it will continue to open its financial markets and encourage foreign investment, according to a summary from the eighth meeting of the Financial Stability and Development Committee posted on its website Sunday, Bloomberg reported.

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