Earlier this week, PingPong, a rapidly-growing Chinese fintech company, announced that it had applied for a payment institution license in Luxembourg.
The agreements have all come as the result of a trip to China by 110 financial industry executives headed by the Crown Prince of Luxembourg and led by the finance minister, Pierre Gramegna.
During the trip Luxembourg also signed four Memoranda of Understanding (MOUs) and one agreement.
The MOUs signed were with the Shanghai Financial Association; the Insurance Association of China; the China Merchants Bank, and Qianhai Financial Holdings. The agreement was between Fudan University and the University of Luxembourg for the establishment of a Confucius institute at the University of Luxembourg.
“This year’s mission reaffirms Luxembourg’s commitment to a close cooperation with China,” Luxembourg for Finance (LFF), the agency responsible for developing the city state’s financial centre, said in a statement.
“With its historical roots in international finance, Luxembourg will continue to act as a bridge for financial institutions inside and outside the EU, while supporting investors in their economic activity with China and the world,” it added.
LFF said Luxembourg-based funds currently account for 68% of European assets invested in mainland China.
It noted that last year, the People’s Bank of China granted Luxembourg a 50bn RMB quota under the the renminbi qualified foreign institutional investor scheme (RQFII), which highlighted the expertise available domestically that is required to access the Chinese market.
“Compared to other financial centres in Europe, Luxembourg is today by far the leading domicile for RQFII funds,” it said.