Analysts largely believe the government will focus on expanding existing programs, including the Qualified Foreign Institutional Investors (QFII), RMB Qualified Institutional Investors (RQFII) and Qualified Domestic Institutional Investors (QDII) programs, to encourage inbound and outbound capital flows.

In recent years, China's securities regulator has been steadily boosting quotas for the QFII and RQFII programs, while the central bank, the People's Bank of China (PBOC), is preparing for trials of the QDII2 program that allows individual investors to invest outside the country.

Zong said restrictions on outbound investment by domestic individuals will be at the top of the reform agenda.

At Monday's meeting, the cabinet said it will create a comprehensive system for individual outbound investment this year.

It also pledged to steadily roll out reforms to liberalize interest rate and exchange rate regimes.

In mid-April 2012, the central bank moved to widen the yuan's daily trading limit against the US dollar to 1 percent, up from the previous 0.5 percent.

Yi Gang, vice governor of the PBOC, said at a seminar on exchange rate arrangements for the International Monetary Fund held last month that the central bank is currently considering further expanding the yuan's fluctuation limit.

With a widening daily limit and more frequent capital flows in and out of the country, the yuan will be more volatile and market-based in the future, Zong said.