Zhang Bin, head of the International Cooperation Department at the Shanghai Stock Exchange, revealed at a recent exchange market event that the number of Qualified Foreign Institutional Investors has now surpassed 1,000, with approvals this year hitting a record high for the same period in history. This milestone extends beyond a simple numerical increase, signaling a substantive rise in global capital's recognition of China's institutional environment, investment convenience, and long-term value, while adding a compelling chapter to the high-quality opening of the capital markets.

In recent years, regulators have steadily advanced systematic improvements to the QFII framework. In October 2025, the Work Plan for Optimizing the Qualified Foreign Investor System was released, outlining a two-year roadmap to implement reforms aimed at enhancing both convenience and attractiveness. A landmark development followed in April 2026, when QFIIs gained access to government bond futures trading, closing a critical gap in risk management tools for foreign investors allocating to yuan-denominated assets. The compounding effect of these institutional dividends has significantly reduced the institutional, time, and transaction costs for cross-border investment, paving a smoother path for long-term capital, including global sovereign funds, pension funds, and leading asset managers, to establish positions in China.

Meanwhile, with divergent global economic recoveries and rising uncertainty over major central banks' monetary policy paths, overseas asset valuations have become increasingly volatile, prompting global capital to seek quality safe-haven destinations. In contrast, China's economic fundamentals remain stable and positive, with ongoing industrial transformation and upgrading generating structural investment opportunities across high-end manufacturing, technological innovation, and green low-carbon sectors. The resilience of the A-share market has strengthened, enhancing the diversification and allocation value of yuan assets within global portfolios. The growing number of foreign institutions applying for QFII status and deepening their presence in China, shifting from early trial positions to strategic allocation based on long-term value, represents a resounding vote of confidence in China's economic prospects and the effectiveness of its capital market reforms.

The continued expansion of the QFII investor base is also having a visibly positive impact on the A-share market ecosystem. Foreign institutions bring not only incremental capital but also mature market investment philosophies and governance expertise. Their emphasis on fundamental research helps channel market attention toward intrinsic corporate value, while improving the overall investor structure and helping to moderate short-term irrational volatility. Furthermore, active foreign participation in market trading and price discovery raises the bar for information disclosure quality, corporate governance standards, and operational efficiency among listed domestic companies, objectively pushing Chinese capital market rules, trading mechanisms, and regulatory frameworks toward closer alignment with international norms. This fosters a virtuous cycle where openness and reform reinforce each other.

As the Work Plan for Optimizing the Qualified Foreign Investor System continues to be implemented, with further expansion of cross-market connectivity mechanisms and steady progress in yuan internationalization, China's capital markets are poised to offer global investors an even broader stage to share in the dividends of China's development, with the appeal to long-term foreign capital set to strengthen further.