China opens up its financial sector for foreign investors

China has announced steps to improve access to its financial sector for foreign investors by raising the ceiling on foreign equity ownership in joint venture firms involved in the futures, securities and funds markets to 51 per cent from the current 49 per cent.

China will remove all equity ownership limits in many financial sectors after three years, vice minister of finance Zhu Guangyao told a news conference.

China will firms relax controls on foreign ownership in Chinese banks, insurance companies, and asset management firms, he said.

The move will allow overseas investors greater access to the Asian giant's financial services market by setting up subsidiaries with majority holding - a long-anticipated step.

The rules will take effect immediately following the drafting of specific related rules, Zhu told a news conference. However, no time frame has been set for framing the revised ownership norms.

China's move to ease financial sector curbs for foreign investors comes a day after US President Donald Trump reiterated calls for better access to Chinese markets in meetings with Chinese President Xi Jinping.

During his trip to Beijing, Trump said trade between the two nations was unfair, and called for greater market access for US companies.

''We really have to look at access, forced technology transfer, and the theft of intellectual property, which just by and of itself, is costing the United States and its companies at least $300 billion a year,'' Trump said.

''Both the United States and China will have a more prosperous future if we can achieve a level economic playing field. Right now, unfortunately, it is a very one-sided and unfair one.''

The foreign business community welcomed the news but urged caution until it was clear how rules would be implemented.

''Financial services further opening definitely has been high on our list,'' said Ken Jarrett, President of American Chamber of Commerce in Shanghai.

''It's a step in the right direction. We'll have to see the detailed rules. In China you always have to pay attention to the fine print to see how quickly it moves, but to finally ease up on the cap is something that is welcome.''

China has been slow to allow foreign investors greater access to its financial sector, but has promised to quicken the pace as foreign investment into the world's second-biggest economy slows.

Markets reacted positively to the news, with insurers and futures-related firms rallying strongly.

New China Life Insurance jumped nearly 6 per cent after the announcement, while Ping An Insurance advanced more than 4 per cent and China Pacific Insurance Group gained over 3 per cent.