Despite the stated goal to allow markets to play a larger role in the Chinese economy following China’s Third Plenum, Chinese citizens are still not entirely free to take capital out of the country, though many are trying to do so illegally. Currently, the cap is set to $50 000/year. The Hong Kong and Shanghai Banking Corporation (HSBC) predicts that the renminbi will be one of the most traded currencies in the world, on par with the euro and the dollar by 2015, but many things still hinder unfettered cross border transactions with the renminbi (RMB).[1]
Despite the $50 000/year investment cap, wealthy Chinese (with over 10 million RMB to their name) still hold 19% of their assets overseas and 44% have plans to emigrate themselves according to the Hurun report.[2]
The fear is that a nationwide liberalization of capital control would trigger a cash exodus from China – as entrepreneurs and officials alike would seek safe havens for their cash abroad. Hot money flows, i.e. money being invested to reap short term profits on interest rate differences in between nations is also a concern for Chinese policy makers. In 1996, plans on making the RMB fully convertible were seriously postponed by the Asian financial crisis and the resulting hot money flows which made Chinese policy makers extremely cautious.
Going abroad

The investment environment in China with its low interest rates and a stock market which continues to underperform provides little incentives for wealthy Chinese seeking to invest their capital, but since outbound capital investments are strictly restricted – investors are forced to move the money out of China via underground banks. These illicit transfers of funds, ranging in the hundreds of billions according to the Wall Street Journal, mainly leaves China via the special administrative region of Hong Kong, which has a much relaxed capital control compared to mainland China. [3]

To alleviate the situation and further open up the currency for legal cross border transactions, special administrative zones are being established, like the Shanghai Pilot Free Trade Zone, spurred by reformist Premiere Li Keqiang. In the special zones, full convertibility of the renminbi is allowed, albeit on a small scale under special circumstances. In a recent publication of financial guidelines by The People's Bank of China (PBOC), more specifics for the Shanghai Pilot Free Trade Zone where detailed in order to further spur the convertibility of the RMB and push forward a market oriented reform of interest rates, in accordance with the new market driven economic directives issued by the central committee of the Communist party after their recent landmark meeting, the Third Plenum. PBOC's document, named "Opinions on Leveraging the Role of Finance in Supporting the Construction of China (Shanghai) Free Trade Zone", stated that residents of the Shanghai PFTZ are allowed to set up "resident free trade accounts" in both domestic and foreign currencies, and allowed for the RMB to be fully convertible under those accounts "when conditions are ripe". The document further outlined a number of financial reforms exclusive within the PFTZ to further facilitate cross border currency flows. [4] 

The Shanghai's Pilot Free Trade Zone, "the hole in China's currency wall", is in effect a the Chinese governments attempt to gradually internationalize the renminbi – in a way which limits potential damage to the economy.[5]
 Currently many more provinces such as Tianjin and Guangdong are seeking permission to establish special trade zones, so they also can reap the benefits of having relaxed cross currency restrictions. If the reforms conducted in the special Zones will be implemented on a nationwide scale – the RMB will in effect become fully convertible, and become a global currency such as the HSBC predicts.