Hong Kong Bond Connect launches

Updated 2017-07-04 11:02:48 CGTN

Hong Kong Exchanges and Clearing Limited held a ceremony on Monday to launch the "northbound" mainland-Hong Kong bond connect.

With the long-awaited Bond Connect launched, qualified overseas investors are now able to invest in the Chinese mainland interbank bond market without having to set up onshore accounts.

As of 9:20 a.m. (01:20 GMT), 86 institutional investors traded more than 3 billion yuan worth of bonds via the cross-border trading scheme.

The program links China's 9-trillion-U.S.-dollar bond market, the world's' third largest of its kind, with overseas investors, in a latest measure which reflects the further opening up of the country's capital market.

Trading will initially be "northbound", so Chinese mainland investors will not yet be able to buy and sell Hong Kong-listed debt.

Hong Kong Chief Executive Carrie Lam Cheng Yuet-ngor hosted the ceremony at the Hong Kong Exchange on Monday, three days after she was sworn in.

"The Bond Connect marks another new chapter of mutual market access between the Chinese mainland and Hong Kong," she said, "It is an important milestone for the internationalization of the RMB as it makes it easy for international investors to trade bonds in China."

The next step, she said, is to work on the launch of "southbound" trading to allow mainland investors to buy and sell bonds in Hong Kong.

Pan Gongsheng, deputy governor of China's central bank, the People's Bank of China, said the bond connect "demonstrated the importance of Hong Kong as an international financial center."

The link, which is a sister scheme to the stock connects already running among Hong Kong, Shanghai and Shenzhen, is likely to help China win inclusion in global bond indices.

At the moment, the size of overseas investment in China's domestic bond market is about 830 billion yuan, accounting for less than 2 percent of the market share. The low proportion indicates a high growth potential.

Goldman Sachs predicts more than one trillion U.S. dollars of offshore bond funds could flow into Chinese debt in the next decade.

In addition, international investors can also trade mainland bonds through other channels such as the Qualified Foreign Institutional Investor (QFII) and Renminbi Qualified Foreign Institutional Investor (RQFII).

Also in the News

Nicole Kidman Recalls Oscar Glory: Loneliest Time
Showbiz2016/06/16 13:58August 24 2017 18:41:30

Nicole Kidman Recalls Oscar Glory: Loneliest Time

Attending Shanghai International Film Festival, Nicole Kidman talks about her role in "Grace of Monaco".

Labor Day Travel Peak Starts
Also in the News2014/05/01 12:16August 24 2017 18:41:30

Labor Day Travel Peak Starts

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'
Also in the News2014/04/18 13:18August 24 2017 18:41:30

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'

Hollywood star Johnny Depp's speech in the upcoming new film "Transcendence" has been disclosed on Friday, April 11th.

Most Watched

News:
China World Business Sports Showbiz Audio
Video:
C4 My Chinese Life The Sound Stage China Revealed Showbiz Video Travel Video
Photos:
China World Fun Travel Entertainment Sports
Travel:
Beijing Shanghai Guangzhou
Lifestyle:
Live Music Opera & Classical Movies Traditional Shows Exhibitions
Learn Chinese:
Chinese Studio Living Chinese Everyday Chinese Just For Fun Chinese Culture Buzzwords