New Development Of RMB Offshore Market Brings Opportunities For Hongkong And Taiwan

According to the announcement, the Shanghai stock exchange and the stock exchange of Hongkong will allow investors from both sides to buy and sell shares on the other side of the stock exchange stipulated in the local securities companies (or brokers). The securities industry pointed out that Shanghai and Hong Kong can not only facilitate mainland investors to invest directly in the Hongkong market, but also increase investment channels for offshore RMB funds to facilitate the orderly flow of Renminbi in the two places.

According to the statistics of the Hongkong SAR government, as of the end of February this year, the total amount of RMB deposits and certificates of deposit in Hongkong amounted to 11280 billion yuan. In 2013, the total amount of RMB trade settlement transactions handled by the Bank of Hongkong amounted to 38410 billion yuan, an increase of 46% over 2012.

According to the statistics of the global bank Financial Telecommunication Association, the Hongkong bank's RMB payment and transaction volume accounts for about 80% of the total volume of global transactions entering and leaving the mainland and offshore markets. Such a large amount of offshore renminbi funds needs appropriate. Investment channels Let the "Jin flow" flow fully and bring about better results.

Shanghai and Hong Kong are conducive to establishing a smooth return channel from the offshore market to the onshore market. This helps to establish a symmetrical and complete offshore - Offshore RMB market cycle. Zhao Xijun, vice president of the school of Finance and finance, Renmin University of China, said that with the acceleration of the internationalization of RMB, Hongkong has become the largest Renminbi in the world. Offshore market But for a long time, offshore RMB investment channels are limited, which affects the process of RMB internationalization.

Mainland and individual investors can invest in 266 stocks in Hongkong and Hongkong, which can invest more than 500 stocks in Shanghai A shares. This will bring new vitality to the A share market and stimulate the growth of trading volume. The huge market and capital pool in the mainland will also push the Hongkong market stronger and bigger to help RMB internationalization process.

It is estimated that the daily volume of Shanghai stock accounts for about 1/7 of the Shanghai stock exchange volume, and the daily share of Hong Kong stock accounts for about 1/5 of the Hong Kong stock exchange volume. Zuo Xiaolei, chief economist of galaxy securities, believes that the policy of Hongkong and Hong Kong has shown the support of the central government for building offshore RMB centers in Hongkong, and also highlights the indispensable role of Hong Kong in the process of RMB internationalization.

According to statistics, Hongkong is the sixth largest foreign exchange market and the 15 largest banking center in the world. The number of international financial institutions operating in Hongkong is large, including 138 foreign licensed banks, 30 restricted licence banks, 31 deposit taking company and 84 foreign bank representative offices. Of the 100 largest banks in the world, 69 are operating in Hongkong.

"Hongkong, as an international financial center, still has its own unique advantages. The process of internationalization of the RMB should be a good use of this advantage." Zuo Xiaolei said that the construction of offshore RMB center also brings many benefits to Hongkong. Hongkong's foreign exchange and investment and financing market will attract more investment.

Compared with Hongkong, the offshore RMB market in Taiwan is slightly smaller, but it is also developing rapidly. As of the end of February this year, the balance of RMB deposits in Taiwan was as high as 247 billion 51 million yuan. Among them, the RMB stock of offshore banking platform market in Taiwan is 54 billion 500 million yuan, accounting for 22% of the total bank deposits in Taiwan.

Synchronized with scale Offshore renminbi Strong investment demand. In response to this demand, the mainland securities regulatory authorities added an additional quota of 100 billion yuan RQFII (RMB qualified foreign institutional investors) to Taiwan in January last year. At the end of last year, Taiwan adjusted offshore banking platform business norms and formally released renminbi funds. Taiwan's offshore renminbi market accelerated.

In December of last year, the first time Hongkong Island branch of the Bank of communications, Hongkong branch of the Agricultural Bank of China, Hongkong branch of Bank of China and Hongkong branch of China Construction Bank launched the "treasure island debt" at the Taiwan securities counter trading center at the same time. The total issue amount reached 6 billion 700 million yuan.

In February this year, the financial affairs department of Taiwan launched the "development of the financial business plan featuring both sides of the Strait", including the launching of the ten major bright spot projects, namely, launching the RMB exchange business in the designated foreign exchange bank, the modern gold flow platform on both sides of the Taiwan Strait, and assisting the financial institutions in the mainland to distribute the services to Taiwan businessmen.

In April of this year, the RMB bond fund of Shanghai huitianfu Fund Management Co., Ltd. successfully entered the Taiwan market through cooperation with Standard Chartered Bank. Taiwan's renminbi investors have access to direct investment through the mainland.

Zhu Lei, director of the Economic Research Office of the Taiwan Institute of the Chinese Academy of Social Sciences, believes that the ways and means of RMB internationalization are various. The progress of Taiwan's development of the offshore RMB market depends on the extent to which the authorities' policies and measures meet the market demand.

"Under the ECFA framework already reached by both sides of the Straits, considerable progress has been made in mutual investment and opening up between the two sides of the financial industry." Zhu Lei appealed to Taiwan legislatures to adopt the trade in services agreement as soon as possible, so that the financial industry on both sides of the Strait could be further opened up.

"The internationalization process of RMB will help Taiwan enterprises to use more renminbi to settle, avoid exchange losses and risks, and facilitate the facilitation of investment and financing, which will bring tangible benefits to them." Zhu Lei said.