As the first offshore market to launch RMB business since 2004, Hong Kong has become the world’s center for RMB trade settlement, financing and asset management, offering a wide range of RMB products and services to meet the needs of of companies, financial institutions and investors.
As the RMB is a stable currency and is increasingly used as a global reserve currency, investors are increasingly diversifying into RMB-denominated financial products.
In terms of investment, 60% of foreign direct investment in mainland China flows through Hong Kong. And vice versa, about 60 percent of overseas investment by mainland Chinese companies is channeled through Hong Kong.
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With such a unique reach and capability in dealing with RMB transactions, Hong Kong is at the forefront of developing innovative RMB assets.
Hong Kong has huge potential in RMB product innovation as it maintains a huge RMB reserve with the highest demand for investment in CNH (the Chinese yuan traded in the offshore market, like Hong Kong), and investments South-bound also look to performance and differentiation in Hong Kong, which will push the market to provide new product insights, said Rick Wen, Deputy Head of Fixed Income Investing, ICBC Asset Management Global.
In terms of investment, 60% of foreign direct investment in mainland China flows through Hong Kong
Hong Kong is a mature and sophisticated economy full of opportunities, both on the consumer and business side. Along with the greater opportunity of the Greater Bay Area, many companies use Hong Kong to cover ASEAN countries and achieve operations throughout Asia, said Stephen Phillips, Managing Director of Investment Promotion at Invest Hong Kong.
Article republished from the Chinese state media CGTN within the framework of an agreement between both parties to share content. Link to original article: https://news.cgtn.com/news/2022-06-29/Hong-Kong-to-play-indispensable-role-in-rising-global-RMB-demand–1bgu88cUds4/index.html
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