China's capital market got its start in the early 1990s，and in less than 30 years it has grown into the world's third-largest stock and bond market. In its more recent past it has evolved into a truly open market with a multi-dimensional framework. And as it develops in the future it will need to combine international experience and practice with Chinese characteristics to progress in a balanced manner.

In the early 1990s，when the stock market was still in its infancy，B-shares were launched to bring in foreign investors. The B-share market was specially designed for foreign investors with investments made in US dollars and Hong Kong dollars. But in 2001 the market was opened to domestic investors，and in subsequent years there were important gains in trading rules，market management and accounting standards.

An initial key step was the introduction of the qualified institutional investor system which has gradually become a key investment channel. In 2002，the State Administration of Foreign Exchange (SAFE)，the China Securities Regulatory Commission and other authorities launched the Qualified Foreign Institutional Investor (QFII) system，which allowed qualified foreign institutional investors to invest in the domestic A-share market within an approved investment quota. In 2011，in line with the internationalization of the renminbi，the Renminbi Qualified Foreign Institutional Investor (RQFII) program was introduced to allow qualified foreign institutional investors to use renminbi to make cross-border investments in domestic securities.

In 2016 and 2018，SAFE focused on simplifying foreign exchange management and facilitating currency convertibility. It has carried out two rounds of reforms of the QFII and RQFII programs，establishing the principle of open and transparent quota allocation. This has contributed to the smoother operation of the QFII and RQFII systems alongside of the Shanghai-Shenzhen-Hong Kong Stock Connect programs，which allow cross-border securities investments. These policies have basically removed restrictions on cross-border capital flows for foreign investors. As of the end of August 2018，a total of 299 QFII institutions had been approved with a total investment quota of US$100.5 billion. Nineteen countries and regions have become RQFII pilot areas with a total investment quota of 1.94 trillion yuan，and 199 RQFII institutions have been approved for a total quota of 628.7 billion yuan.