2024-01-27 08:00:53
Xinhua News Agency, Beijing, January 27 Title: A package of measures to promote financial cooperation between mainland and Hong Kong further
Xinhua News Agency reporters Ren Jun and Wu Yu
“Bond Connect” upgrade, “Cross-border Wealth Management Connect” optimization, the implementation of policies to facilitate Hong Kong and Macao residents’ home purchase payments, and deepening the cross-border pilot of digital renminbi… Recently, the People’s Bank of China and the Hong Kong Monetary Authority decided to launch six policy initiatives, the mainland and Hong Kong financial cooperation is expected to go further.
At the press conference of the State Council Information Office held on January 24, Xuan Changneng, deputy governor of the People’s Bank of China, introduced that the six measures to deepen financial cooperation between the mainland and Hong Kong can be summarized as “three connections and three conveniences”.
In terms of China Unicom, the first is to include bonds under “Bond Connect” as eligible collateral for the Hong Kong Monetary Authority’s RMB liquidity arrangement; the second is to further open up foreign investors to participate in domestic bond repurchase business; the third is to announce the optimization of the Guangdong-Hong Kong-Macao Greater Bay Area Implementation rules for the district’s “Cross-border Wealth Management Connect” business pilot.
The reporter noticed that the “Three Connects” are closely related to the bond market. On the one hand, the RMB treasury bonds and policy financial bonds under the “Bond Connect” northbound cooperation are included in the list of eligible collateral for RMB liquidity arrangements; on the other hand, the “About Further Supporting Foreign Institutional Investors in Carrying out Bond Returns in the Inter-bank Bond Market” “Announcement on Purchase Business (Draft for Comment)” was recently announced and plans to support all overseas institutions that have entered the inter-bank bond market to participate in bond repurchases.
“Allowing overseas institutions to use high-quality bonds held by ‘Bond Connect’ as collateral for Hong Kong’s open market operations will help further enhance the attractiveness of China’s bond market.” Zeng Jizhi, head of the financial markets department of Standard Chartered Hong Kong, said that RMB bonds have better It has investment value and hedging properties, and the rate of return is also very stable. Foreign investors have always regarded it as an important allocation asset.
Industry insiders said that the scope of participants in the bond repurchase business has been further expanded and the types have become more diverse, which will help foreign investors meet their liquidity management needs and control capital costs. It is another important progress in the process of opening up China’s bond market.
In recent years, China’s bond market has made great progress in opening up to the outside world. As of the end of 2023, a total of 1,124 overseas institutions have entered the Chinese bond market, covering more than 70 countries and regions, and the total amount of Chinese bonds held is 3.72 trillion yuan, an increase of 340% compared with before the launch of “Bond Connect”.
As an important part of the “Three Connects”, the newly revised implementation details of the “Cross-border Wealth Management Connect” business pilot in the Guangdong-Hong Kong-Macao Greater Bay Area have been officially released. The revised implementation details have expanded the scope of participating institutions and added securities companies as pilot entities; increased the individual investor limit from 1 million yuan to 3 million yuan; and included the RMB deposit products of mainland sales banks as eligible for the “Northbound Connect” Product Range.
The “Cross-border Wealth Management Connect” business will be piloted starting in 2021. As of the end of 2023, a total of 67 banks and 69,000 individual investors in the Guangdong-Hong Kong-Macao Greater Bay Area have participated in the “Cross-border Wealth Management Connect” business pilot, and the cumulative amount of cross-border remittances of related funds has been 12.8 billion yuan. In 2023, the amount of cross-border remittances of funds related to the “Cross-border Wealth Management Connect” business pilot was 10.59 billion yuan, a year-on-year increase of 3.8 times.
After the implementation details are revised, it will be more convenient for residents of the Guangdong-Hong Kong-Macao Greater Bay Area to participate in the “Cross-border Wealth Management Connect” business pilot, the participation channels will be more diversified, and the wealth management products available for purchase will be more abundant.
Among the six policy “gift packages” announced this time, there are also three facilitation policies: first, to implement a facilitation policy for Hong Kong and Macao residents’ home purchase payments in the Greater Bay Area to better meet the home purchase needs of Hong Kong and Macao residents; second, to expand Shenzhen-Hong Kong cross-border The scope of the credit cooperation pilot will facilitate cross-border financing of Shenzhen and Hong Kong enterprises; third, the cross-border pilot of digital renminbi will be deepened to bring more convenience to Hong Kong and mainland resident enterprises.
It is worth mentioning that based on preliminary testing and verification, the Digital Currency Research Institute of the People’s Bank of China and the Hong Kong Monetary Authority will further deepen cross-border pilot cooperation on digital renminbi: explore personal small-amount cross-border remittance services based on digital renminbi, and promote digital The interoperability of local payment barcodes between RMB and Hong Kong will promote the opening of digital RMB payment methods on mainland and Hong Kong online platforms in an orderly manner in key scenarios such as cross-border e-commerce and tuition payment… Many measures are expected to improve the efficiency of straight-through processing of cross-border business. Reduce transaction costs.
In the eyes of financial professionals, the launch of the package of measures demonstrates China’s determination to expand high-level opening up to the outside world, will further deepen the interconnection of the financial markets of the mainland and Hong Kong, and consolidate and enhance Hong Kong’s status as an international financial center.
Xuanchangneng said that in the next step, the People’s Bank of China will work closely with the financial management departments of the mainland and Hong Kong to jointly promote the implementation of various policies and measures, further optimize financial services, strengthen financial cooperation, and promote the further development of Hong Kong as an international financial center.
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