UK to facilitate Chinese trading
Chancellor George Osborne has announced plans to make London the main centre for Chinese financial business overseas.
Under an £8bn pilot scheme, London-based investors will be able to apply for a licence to use the Chinese currency to invest directly in Chinese shares and bonds.
Until now, they have had to direct their investments via Hong Kong.
Talks are already underway between Chinese banks and the UK banks regulator, the Prudential Regulation Authority, to allow them to establish branches for wholesale activities in London.
This would allow China’s huge banks to conduct business in London with companies and financial institutions, but not to offer High Street services.
Prior to the pilot, existing UK rules on transparency have meant that Chinese banks have opted for bases in Luxembourg.
Additionally, on Monday, the chancellor announced a simplified application process for Chinese tourists wanting to visit the UK while in Europe.