Paul Chan: The SAR Government is actively promoting multiple measures to make Hong Kong's offshore RMB market more stable and deeper

At the forum, Deputy Financial Secretary of Hong Kong, Michael Wong Wai-lun, said in his remarks that Hong Kong will enhance RMB liquidity, issue more types of RMB products, and improve the RMB yield curve. The government is studying a new mechanism to strengthen price discovery in the medium- and long-term interest rate market, and believes Hong Kong is capable of contributing to RMB internationalization. The SAR government is actively promoting multiple measures to make Hong Kong's offshore RMB market more stable and deeper. Among them, Hong Kong's first five-year plan explicitly sets strengthening the offshore RMB business as a key focus of Hong Kong's future financial development. Wong pointed out that the government will also strengthen the interconnection between Hong Kong's Central Moneymarkets Unit (CMU) and overseas markets, including deepening cooperation with the Cross-border Interbank Payment System (CIPS), and promoting more foreign banks in Hong Kong to join the CMU, further enhancing the efficiency, security, and convenience of cross-border settlement in Hong Kong. Wong mentioned that currently more than 75% of global offshore RMB payments are processed through Hong Kong. As of the end of July this year, Hong Kong's RMB deposits, together with outstanding certificates of deposit, reached about RMB 1.3 trillion, making it the world's largest offshore RMB liquidity pool. Last year, Hong Kong's offshore RMB loans also hit a record high of RMB 935 billion; the scale of offshore RMB issuance in Hong Kong has also exceeded RMB 1 trillion for two consecutive years. Wong noted that the international environment has undergone substantial changes in recent years. Although this has brought many challenges, it has also provided enormous opportunities for RMB internationalization. Hong Kong will continue to play its role as a bridge between the mainland and international markets, and consolidate and enhance its function as an offshore RMB business hub.