China News Service, Hong Kong, October 21. The Financial Secretary of the Hong Kong Special Administrative Region Government, Chen Maobo, said on the 21st that Hong Kong will work hard to build an "offshore ecosystem" for the renminbi and provide more investment channels and tools denominated in renminbi. And stable and efficient exchange, exchange rate risk and interest rate risk management and other treasury services, so that the RMB can better circulate in the offshore market.

  Chen Maobo delivered a speech at the 2021 Financial Street Forum Annual Meeting-Market-Driven RMB Internationalization and Beijing-Hong Kong Special Exchange Event.

  Chen Maobo said that Hong Kong is a two-way channel for international capital to enter the mainland and mainland capital to the world.

Hong Kong is currently the world's largest offshore RMB business hub, handling about 75% of the global offshore RMB settlement business, with daily settlement volume exceeding RMB 1.5 trillion in the first half of this year.

The offshore RMB deposits in Hong Kong exceeded 800 billion yuan, accounting for approximately 60% of the global offshore RMB deposits.

  He mentioned that in the past few years, measures for the interconnection of capital markets between Hong Kong and the Mainland have been introduced, including Shanghai-Hong Kong Stock Connect, Shenzhen-Hong Kong Stock Connect, Bond Connect, and the mutual recognition of funds between the Mainland and Hong Kong, which have been welcomed by international investors.

Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect Northbound transactions as of August 31 this year average daily turnover of 120 billion yuan, a year-on-year increase of 34%.

On the other hand, as of the end of August this year, the number of mainland bonds held by overseas institutions through Bond Connect, "Northbound Link" and other channels has approached 3.8 trillion yuan.

  Chen Maobo continued that two other major initiatives announced last month, namely the Guangdong-Hong Kong-Macao Greater Bay Area Cross-border Financial Link and Bond Link "Southbound Link", and the Shenzhen Municipal People’s Government’s issuance of offshore RMB local government bonds in Hong Kong this month. It has enriched the financial products denominated in RMB in the Hong Kong market.

  Looking to the future, he said that Hong Kong will continue to maintain communication with the Mainland to improve the liquidity of offshore RMB, and strive to improve and expand various interconnection arrangements to provide effective two-way circulation of RMB funds between offshore and onshore markets. Channels; at the same time, promote the development of RMB products in the offshore market; increase the demand for issuance and trading of RMB securities, and provide listed companies and investors with more RMB investment and financing options; further improve the RMB financial infrastructure in the offshore market; take the lead in the Greater Bay Area Opportunity to try first; and strengthen RMB business ties with overseas markets.

  He also revealed that the Hong Kong Securities Regulatory Commission, the Hong Kong Stock Exchange and the Hong Kong Monetary Authority have set up a joint working group to conduct a feasibility study on the promotion of allowing southbound trading of "Southbound Trading" to be priced in RMB, with a view to formulating detailed recommendations as soon as possible.


Keywords: chen maobo, hong kong, rmb, exchange, interest rate risk management, ecosystem, financial secretary, shenzhen municipal people's government, china news service, renminbi, exchange rate risk, tools, 21st, investment channels, market