China Unveils an Offshore Finance Plan, a New Repo Facility, and Wider Forex Access at Lujiazui Forum

China's financial authorities used the 2026 Lujiazui Forum on Wednesday to roll out a package of opening-up measures that will affect how foreign institutions trade the renminbi, access onshore liquidity, and participate in Shanghai's offshore market. The announcements, delivered by the central bank governor, the foreign exchange regulator, and the securities watchdog, amount to a coordinated signal that capital-account reform is continuing on a defined schedule.

Offshore finance action plan

The Shanghai municipal government released an action plan that prioritises four initial offshore business pilots: offshore trade finance, free trade zone offshore bonds, offshore reinsurance, and offshore renminbi foreign exchange trading. The scope of eligible services will expand as pilot outcomes are assessed. The plan is designed to accelerate Shanghai's development as a global allocation and risk-management centre for renminbi-denominated assets. For foreign institutions, services previously unavailable onshore now have a defined offshore channel in Shanghai.

New repo facility and forex trading

People's Bank of China Governor Pan Gongsheng announced two specific market-access improvements. The first is a FIMA RMB Repo facility — a renminbi repo instrument available to overseas central banks, international financial organisations and sovereign wealth funds, backed by high-grade collateral including Chinese central government bonds. The tool provides a structured mechanism for official institutions to obtain renminbi liquidity without selling their bond holdings, strengthening the incentive to hold Chinese government debt on a long-term basis.

The second is an onshore offshore renminbi foreign exchange trading pilot for six major domestic banks, conducted through the national foreign exchange trading platform within the Shanghai Free Trade Zone. The pilot facilitates large-scale renminbi transactions for overseas institutions by bridging the onshore and offshore markets in a regulated setting.

Foreign holdings cross $1 trillion

State Administration of Foreign Exchange head Zhu Hexin disclosed that foreign holdings of Chinese equities and bonds have exceeded $1 trillion. He also announced that fresh quotas will be issued under the Qualified Domestic Institutional Investors (QDII) outbound investment scheme. The disclosure of the $1 trillion figure provides a quantitative baseline for the scale of foreign participation that the new policy measures are designed to deepen.

Securities regulator on resilience

China Securities Regulatory Commission Chairman Wu Qing said the country's capital markets have undergone "profound positive changes," and that having absorbed major risk shocks, they are showing greater resilience. "Amid sweeping rebalancing and reallocation of global financial assets, Chinese assets are winning wide attention and favour from international investors for their safety, resilience and innovation value," Wu said.

Renminbi outperforming Asian peers

The policy announcements coincide with a period of relative renminbi strength. UBS Global Wealth Management's Chief Investment Office noted on Wednesday that the renminbi has gained 3.4 percent against the US dollar year-to-date, compared with an average loss of 2 percent for Asia ex-Japan currencies. UBS rates the currency as Attractive and recommends adding exposure to dollar-based portfolios for diversification. Wind data shows that global investors including Morgan Stanley, Barclays and the Abu Dhabi Investment Authority increased their exposure to Chinese assets in the first quarter.

The sequencing

The 2026 Lujiazui Forum sits in the inaugural year of China's 15th Five-Year Plan period (2026–30), which lists building the country into a financial powerhouse as a core strategic goal. The policy package — an offshore finance blueprint, a new repo tool, expanded forex access, and explicit recognition of $1 trillion in foreign holdings — indicates that the opening-up agenda is being calibrated in specific, operational increments rather than broad declarations. For the foreign institutions that will use the FIMA repo facility, trade offshore renminbi in Shanghai, or apply for the next round of QDII quotas, the forum has delivered a set of concrete changes to the regulatory perimeter. The market test is now whether those changes translate into higher foreign participation in the renminbi assets whose attractiveness the data already suggest.