REGULATORS APPROVE BOND CONNECT SCHEME
‘North-bound’ investment will not be subject to quotas under plan
IN another step to open up China’s capital markets, Hong Kong and Chinese regulators formally approved a long-awaited scheme to connect China’s US$9 trillion (RM38.88 trillion) bond market with overseas investors.
The Bond Connect programme has been in the works since Beijing launched a similar scheme connecting Hong Kong and Shanghai stock markets in 2014.
Overseas investors have other avenues to buy Chinese debt and currently hold just two per cent of onshore bonds, a relatively low level that reflects concerns about capital controls and the stability of the yuan that some say the connect scheme will do little to alleviate. of quality supervision, inspection and quarantine. The watchdog said the defects could cause headlight failure.
The Hong Kong Monetary Authority and the People’s Bank of China announced their approval on Tuesday, but provided few details about the plan, such as when the bond trading system would go into operation.
They said China Foreign Exchange Trade System and National Interbank Funding Centre, China Central Depository & Clearing and Shanghai Clearing House would be the main Chinese infrastructure providers for the scheme.
They will work with the Hong Kong Exchanges and Clearing and Central Moneymarkets Unit to establish mutual bond market access between Hong Kong and mainland China.
“It will provide a new channel for Hong Kong and international
In March, VW recalled more than one million Audi vehicles due to potential leaks and coolant pumps faults. investors to invest in mainland China’s bond market, which is the third-largest in the world and much undersold to global investors at the moment,” said Benjamin Hung, chief executive for Greater China & North Asia at Standard Chartered.
Initially, foreign and investors here will be allowed to trade in China’s interbank bond market, the so-called northbound trading link. Investment would not be subject to quotas and the scheme would be rolled out in phases, said the authorities.
They did not indicate when northbound trading would begin or when Chinese investors would be able to trade in overseas bonds — the southbound route. Reuters
It will provide a new channel for Hong Kong and international investors to invest in mainland China’s bond market, which is the third-largest in the world and much undersold to global investors at the moment.
The German carmaker delivered nearly four million vehicles in China last year, two-fifth of its global sales. Reuters
FAW-Volkswagen Automobile Co Ltd’s recall covered 416,364 Golfs produced between September 2009 and May 2014, and 161,226 Sagitars produced between July 2010 and March 2012.