China starts lifting restrictions on foreign investment

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China has started lifting major restrictions on foreign investment in its financial sector, a move long demanded by the United States as the world’s two biggest economies are locked in a fierce trade battle.From the start of 2020, foreign banks can now set up wholly-owned branches in China without a local partner holding the majority stake, the banking regulatory authority, CBIRC, announced on Friday.

In the past, foreign banks were required to have a local Chinese partner and not allowed to hold more than 49 percent of their respective joint ventures.The announcement could be seen as a gesture of goodwill by China towards the US as Washington says a preliminary trade agreement between the two sides looks set to be signed this month.

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