China’s capital market opening continues to attract global investors and strengthen confidence in the country’s economic development. The government has implemented measures to make foreign investment more accessible and efficient.
During the 14th Five-Year Plan period (2021-2025), China expanded institutional access as part of its broader financial market liberalization strategy. The number of foreign-controlled securities, funds, and futures firms increased. The China Securities Regulatory Commission approved 13 new companies.
Qualified Foreign Institutional Investors, or QFII, grew to nearly 907 by August 2025. Their holdings of Chinese shares totaled 949.3 billion yuan, roughly 133.6 billion U.S. dollars. Meanwhile, the total market value of northbound funds reached 2.29 trillion yuan in the second quarter, reflecting growth linked to capital market opening.
A recent survey of emerging market investment shows global institutional investors now rank the Chinese stock market as their top choice. More than half of respondents said they are optimistic about mainland stocks, up from one-third in June. This trend reflects confidence in the ongoing financial market liberalization.
Experts say this growth highlights the positive results of China’s capital market opening. Zhao Xijun, a finance professor at Renmin University, explained that foreign institutions can leverage their expertise to enhance market vitality while sharing in China’s economic gains.
Several policy measures support the success of capital market opening. Foreign ownership limits for financial institutions were removed, the QFII system was improved, and the range of derivatives available to foreign investors expanded. The CSRC is also collaborating with the People’s Bank of China to promote RMB foreign exchange futures trading.
UBS highlighted its engagement through Stock Connect and QFII programs. The company expects A-shares to maintain steady growth as policies strengthen and the external environment stabilizes, benefiting from the broader capital market opening.
China also strengthened Hong Kong’s role as a financial hub. Stock Connect and mutual recognition of funds improved cross-border capital flow. Hong Kong now serves as a bridge for international investment into the mainland, further advancing capital market opening.
Looking ahead, policymakers plan deeper institutional access, improved connectivity, and stronger risk control. Qualified foreign investors will soon access on-exchange ETF options trading, signaling further progress in financial market liberalization.
Despite these advances, authorities remain committed to financial risk management. Guan Tao from BOC International emphasized macro-prudential monitoring and price-based tools to maintain stable capital flows.
Overall, China’s capital market opening is reshaping global investment patterns, expanding opportunities, and reinforcing the country’s economic influence.
