Financial Secretary Henry Tang says the issuance of renminbi (yuan) bonds in Hong Kong signifies the city's role as a premier international finance centre, giving local investors more choice.
Speaking after the launch of renminbi bond settlement in Hong Kong on Tuesday, he stated that the arrangement is a fresh step in Hong Kong-Mainland co-operation.
Noting the renminbi is the fourth currency to go on the Real Time Gross Settlement (RTGS) System, Mr Tang said that this will facilitate the trading and the liquidity of the renminbi bond.
"Although the total [amount] of renminbi in Hong Kong is not very large - about HK$25 billion - I think that with further co-operation and integration between Hong Kong and the Mainland in terms of financial and monetary instruments, the pool can only grow," he suggested.
Mr Tang said there is no plan to list renminbi bonds on the Hong Kong Stock Exchange because many of the brokers are not on the RTGS system.
He added that if more companies can become part of the RTGS system on the approval of Mainland authorities for renminbi transactions, then there will be better liquidity.
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