Hong Kong considers expanding investment links with China

The Hong Kong Monetary Authority (HKMA) is exploring the possibility of enhancing investment connections between Hong Kong and mainland China, according to CEO Eddie Yue.

Speaking at the HSBC Global Investment Summit in Hong Kong, Yue highlighted the potential for increased investment from Chinese investors into Hong Kong’s financial markets, referred to as “southbound” activity.

Yue emphasized the need to deepen existing investment connection schemes, particularly focusing on facilitating capital flows from China to the rest of the world. While he did not provide specific details during the conference, he expressed a commitment to expanding southbound flows, which involve investments from mainland China into Hong Kong’s financial products.

One of the existing schemes mentioned by Yue is the Bond Connect program, which was launched in 2017 to link China’s bond market with overseas investors. However, he noted that the current scope of the southbound Bond Connect is limited, as only Chinese banks can utilize it.

Source: Reuters