The Chinese government has enacted new rules severely limiting foreign currency transfers out of China. The scope of the limitations are not clear but the Xinhua News Agency reported that Chinese banks advised their customers that foreign currency exchanges for investments abroad in property, securities, and life insurance were not allowed. Permitted uses reported thus far are currency exchanges or purchases for tourism, schooling, business travel, and medical care.
Under China's new rule, effective July 1, 2017, financial institutions in China must disclose foreign and domestic transactions involving more than 50,000 yuan (approximately $7,201). Financial institutions in China will also be required to disclose to officials all foreign transfers by individuals of $10,000 or more.
News agencies have reported that tighter control of China's currency market is intended to eradicate money laundering, the funding of terrorism, and financing of "fake" outbound investment transactions, but not standard, valid business activities. The rules were disclosed at the same time as burdens began to rise on the yuan from a recovering U.S. dollar, increasing wealth transfers from China to the United States and beyond. The new rules are also said to arise from unease as to President-elect Trump's threats to limit severely China's exports to the United States.
Read more by clicking below image