December 9, 2007 -- Remarkable progress has been made since China launched its pilot projects for the Qualified Foreign Institutional Investors (QFII) and Qualified Domestic Institutional Investors (QDII) systems in 2002. The QFII system has promoted the transformation of  investment concepts in China's capital market and the application of advanced investment risk management technologies, raised the global influence of China's capital market, and played an active role in the improvement of the governance structure of domestic listed companies, the sound development of the market, as well as the institutional reform and innovation of the capital market. The market capitalization of securities held by 49 QFIIs has reached nearly RMB 200 billion, making them the main institutional investors in China 's capital market. The QDII system has expanded the investment channels for domestic capital, enabling domestic investors to reasonably allocate their assets throughout the world and to reduce investment risks. Moreover, the system has directed the orderly outflow of capital and promoted an equilibrium in the balance of payments. Currently, all qualified commercial banks, insurance companies, fund companies, and securities companies can conduct QDII business, gradually diversifying the members of the QDII system. In particular, with the release of QDII products by fund companies in September, the QDII business has entered a phase of rapid development.
To deepen the opening up of China 's capital market, the investment quota for QFII has been increased to USD 30 billion. Based on the status of China 's balance of payments and the situation of the securities market, together with the relevant departments the SAFE will control the speed of the examination and approval process of new QFII quotas and will encourage investment of qualified foreign medium- and long-term capital into China 's capital market. In addition, the SAFE will expand overseas securities investment by domestic residents, increase foreign securities investment by QDIIs, encourage qualified domestic financial institutions to raise their competitiveness, provide more diversified products that satisfy the needs of domestic investors, and enhance the level of risk management, thus gaining new dominance from participation in global competition under the conditions of economic globalization.