SAFE Tease First

The State Administration of Foreign Exchange is doing a "feasibility study" on whether to allow citizens to use their foreign exchange quotas for foreign investments. Heretofore the quotas were restricted from direct overseas investment.

Those who keep a running tab on such studies know that even announcing such is basically putting the public on notice.

But before you go paying for Databases of mainland Jiang Q. Publics to pitch your mutual fund products, be advised: this kind of watershed new policy will apply to big players first.

"Considering the conventional wisdom of limiting capital outflow by any means necessary, this is a significant shift," says Jimmie Jeremejev. "However, this is going to be quite restricted, at first, and limited to massive, regulated investments that can be easily tracked and studied as use cases. In the near term, regular citizens will not be participating in streamlined overseas investments with their Forex quotas."

Nonetheless, western financial companies with products for large institutional investors have all the more reason for China-facing channels.