International investor appetite for investing in China’s developing stock markets, rediscovered last year, seems to have fallen off, just as access is being enhanced.

Towards the end of last year, the Chinese authorities announced there would be an increase in the quota available for international investors to buy A shares directly. The system is known as the Qualified Foreign Institutional Investor (QFII) programme and was originally announced in 2002 with some $10bn (£5bn €6bn) being made available. This original amount has now grown to an estimated market value of almost $30bn as a result of both strong market appreciation and some currency appreciation. The expectation is that an additional quota of $20bn will be made available this year and will be spread widely amongst many financial institutions seeking to participate.