China to Issue Government Bonds in Hong Kong
By Tang Xiangyang, 2009-09-11
China will sell 6 billion yuan of government bonds in Hong Kong for the first time later this month, according to a statement posted to the Ministry of Finance's (MOF) website on Tuesday.
The 6 billion yuan (＄876 million US dollars) worth of bonds will be yuan-dominated and sold on September 28. But the ministry did not provide any detail about who would handle the bond issue.
China has recently expressed its concern regarding the stability of the US dollar and has signaled it's desire to gradually see the Renminbi become a global reserve currency.
Along with the launch of a pilot RMB settlement scheme earlier this year, this bond issue marks another small step in the long road to the internationalization of China's currency.
According to the official statement, the bond offer is an indication of the central government's support for Hong Kong, and it argues that the move will not only strengthen the special administrative regions' financial cooperation with the mainland but will also help to consolidate Hong Kong's position as an international financial hub.
The bonds will be sold to both institutions and individual investors.
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