LONDON (Reuters) - Government policies to encourage companies to pay more dividends should increase the attractiveness of China's stock market for overseas investors, a senior Chinese regulator said on Thursday.

Fang Xinghai, vice chairman of the China Securities Regulatory Commission, said the Chinese government set out policies last month to strengthen its capital markets, including moves to encourage listed companies to pay more dividends.

"Chinese listed companies traditionally have not paid enough dividends. We are now encouraging them to pay more dividends," Fang told a 'roadshow' in London to attract more overseas investment in Chinese listed companies.

"This should very much enhance investor value of Chinese stocks going forward," Fang told the event hosted by the Shanghai and Shenzhen stock exchanges.