Sat, 04 Dec 2021

First mainland local gov't bond issued in Hong Kong

Xinhua
13 Oct 2021, 02:05 GMT+10

HONG KONG, Oct. 12 (Xinhua) -- South China's Shenzhen Municipality on Tuesday became the first local government from the mainland to issue an offshore renminbi bond in Hong Kong, a move hailed as a major step in the internationalization of the Chinese currency renminbi.

The dim sum bond, or debt denominated in renminbi and issued in Hong Kong, is expected to raise 5 billion yuan (about 775 million U.S. dollars) with tenures of two, three, and five years. The raised funds are used for the construction of public high schools, urban rail transit, and water treatment projects, and some of the bonds are green bonds.

The issuance has received enthusiastic subscriptions from international investors from countries and regions along the Belt and Road and offshore renminbi financial centers, as well as Chinese investors.

Chief Executive of the Hong Kong Special Administrative Region Carrie Lam said the issuance will enhance Hong Kong's role as an international financial center and an offshore renminbi trading center, calling the bond a milestone in renminbi internationalization and a new chapter of Hong Kong-Shenzhen cooperation in the Greater Bay Area.

Echoing Lam, chairperson of Hong Kong Exchanges and Clearing Limited (HKEX) Laura Cha Shih May-lung said the debut has enhanced the depth and breadth of the Hong Kong bond market and enriched Hong Kong's renminbi investment products and green financial products.

Chief Executive of the Hong Kong Monetary Authority Eddie Yue said the green bonds are of great significance to the development of green finance in the mainland and the introduction of overseas funds to participate in the realization of China's targets to reach carbon peak and neutrality by 2030 and 2060, respectively.

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