The first exchange-traded fund (ETF) to offer both institutional and retail investors exposure to money market instruments which invest in China’s CIBM launched today on the London Stock Exchange.

The Commerzbank CCBI RQFII Money Market Ucits ETF listing was marked with Dr Hu Zhanghong, CEO of CCBI, opening trading on the Exchange alongside Andrea Leadsom MP, economic secretary to the Treasury; Minister Counsellor Jin Xu, Embassy of the People’s Republic of China to the United Kingdom and Xavier Rolet, CEO of London Stock Exchange Group.

“Today, we witness a further achievement on building off-shore RMB center in London, which we hope to see more in the future. I do believe, with passion and innovation, the UK can continually play an important role in the RMB internationalisation,” said Minister Counsellor Jin Xu, Embassy of the People’s Republic of China to the United Kingdom.

The listing is the first of its type in any European market. London is at the forefront of RMB-product development and has recently introduced CNY and HKD trading for ETFs, supported by clearing and settlement. There are currently four RQFII ETFs listed on London Stock Exchange and since the first London listing in January 2014, RQFII ETFs have traded over £1.5bn in value and accounted for over 7000 trades on London’s markets. 

“The launch of this innovative new product, which will provide further opportunities for British and other global investors to invest directly into China, underscores Britain’s position as the western centre for offshore RMB and a global centre for asset management," said Andrea Leadsom, economic secretary to the Treasury.

“It’s also yet another example of the good relationship between Britain and China, building on last September’s Economic and Financial Dialogue where our two countries agreed the most significant package of measures ever on financial services. And it’s testament to our commitment to investment management. When the government launched the UK’s Investment Management Strategy in 2013, it was our intention to make the UK a major jurisdiction for fund domicile. So I am particularly pleased that CCBI has chosen to domicile this ground-breaking fund in the UK.”

Daniel Godfrey, CEO of the Investment Management Association, said that the launch shows that with the right tax and regulatory environment, the UK has become an attractive and competitive fund domicile. 

“It also demonstrates that the targeted measures introduced by the Government under its Investment Management Strategy, including the abolition of Schedule 19 Stamp Duty Reserve Tax, are succeeding in attracting investors to UK funds, leading to a chain of wider economic benefits,” he added.