By Roxanne Liu and Selena Li

Blackstone's newly established China unit has received regulatory approval to raise funds that will be invested overseas, joining other global asset managers in seeking to tap Chinese investor demand for foreign assets.

Blackstone registered a fund management unit with the Asset Management Association of China under the qualified domestic limited partnership (QDLP) programme, a notice from the regulator showed.

The unit, which was established in March, has seven full time employees, including five fund professionals, the notice said.

The quota-based QDLP programme, first launched in 2012, allows foreign and domestic fund managers to raise money from Chinese high-net worth individuals and institutions which is then fed into offshore funds.

It was not immediately clear how big Blackstone's quota is.

The U.S. asset manager declined to comment.

The QDLP programme is generally more popular when the yuan is weaker. Chinese investors have in recent months rushed to make dollar deposits and buy Hong Kong insurance, signalling stronger demand for foreign assets as the yuan comes under more pressure.

As China forges ahead with opening its financial markets to foreigners, an increasing number of global asset managers have set up shop in the past few years, with fund giants KKR and BlackRock receiving QDLP licences last year.

U.S.-based Thornburg Investment Management's unit Thornburg Investment Management (Shanghai) Ltd was last month deregistered as a QDLP fund manager, after failing to launch its first private fund within the required time period of 12 months.

(Reporting by Roxanne Liu and Selena Li; Editing by Edwina Gibbs)