The coastal city of Qingdao in East China's Shandong province has launched the country's first expansion of the qualified domestic limited partner (QDLP) program which allows foreign institutions to raise yuan in China and invest it abroad.

Qualified foreign-owned fund management companies, established in Qingdao, will not only be able to invest in overseas secondary markets, but also to explore investment and acquisition in overseas primary markets as well as commodity trades, the local authority said.

The move makes Qingdao a pioneer in the country's comprehensive financial reforms, said Bai Guangzhao, director general of the Qingdao Municipal Financial Office.

"Compared with previous pilot cities, including Shanghai and Shenzhen, it is the first time for QDLP to expand its application scope," he said. "It also enlarged the channel for capital to come in and out of China."

Apart from QDLP, Qingdao also launched the qualified foreign limited partner (QFLP) scheme, which allows overseas investors to establish RMB private equity funds in Qingdao converted from foreign currency or yuan raised in China. This can be invested in unlisted domestic enterprises, non-publicly traded equity of listed companies, convertible bonds and industry investment funds.

QFLP applicators could be overseas sovereign wealth funds, pension funds, endowment funds and charity funds, as well as investment fund companies, insurance companies and bank security companies.

A total of 35 new policies have been approved and started implementation in Qingdao since its municipal government submitted a general implementation plan for the Wealth Management Financial Comprehensive Reform Pilot Area in May last year.