BEIJING — China has decided to raise the investment quota for the Republic of Korea (ROK) under the RMB Qualified Foreign Institutional Investors (RQFII) scheme to 120 billion yuan ($18.9 billion), the central bank announced on Oct 31.

Previously, the volume was set at 80 billion yuan.

The RQFII mechanism, which was launched in December 2011 to widen investment channels for overseas yuan funds on the Chinese mainland, allows qualified investors to invest yuan-based funds in the mainland securities market within a permitted quota.

The decision is part of a set of financial cooperation agreements reached between the two countries. The People’s Bank of China also said the two sides have agreed to set up a direct trading exchange market between the yuan and the won under the China Foreign Exchange Trade System in the near term.

Other cooperation include accelerating the bond markets in the two countries to push yuan’s global use and pilot new financing cooperation models in East China’s Shandong province.