China Eases Limits on Foreign Stakes in Financial Firms<br />Peter L. Alexander, the founder and managing director of Z-Ben Advisors, a Shanghai financial consulting firm, said<br />that because Chinese investors tend to have large holdings in relatively simple money market funds and have not yet shown much interest in purchasing exchange-traded funds, “there’s an opportunity for active managers.”<br />Mr. Zhu also repeated on Friday a Chinese pledge made late Thursday to ease joint-venture requirements for electric cars<br />and other so-called new energy vehicles that may be built in China’s free-trade zones.<br />Zhu Guangyao, China’s vice finance minister, said that his country would start allowing foreign investors to own 51 percent of Chinese securities firms, fund managers<br />and futures companies, and would allow them to own 100 percent three years from now.<br />Mr. Zhu said that China would also raise the allowed foreign investment in insurance companies, currently<br />50 percent for most companies, to 51 percent in three years and 100 percent in five years.<br />Still, the Chinese initiative could help Beijing rally political support from Wall Street banks and securities firms, which have profited from fees on Chinese purchases of American companies<br />but have long been limited in what they could do inside China.<br />China also plans to eliminate its current limit of 25 percent foreign ownership in banks, Mr. Zhu said, but did not say when it might happen..<br />The Chinese government said on Friday that it would relax or remove a broad range of limits on foreign ownership of banks and securities firms.<br />The current limit on foreign ownership is 25 percent for large, publicly traded securities firms<br />and 49 percent for most other businesses in these categories.
