People’s Bank of China vice-governor Fan Yifei (范一飞) said that the central bank will help Hong Kong to further consolidate its position as a hub for the offshore trading of the Chinese yuan.
Speaking at a public event on 3 February, Fan said that Hong Kong was a major international financial centre as well as offshore RMB centre, and possessed natural advantages that supported settlement and monetary cooperation amongst Belt and Road countries.
According to Fan Hong Kong must play a more comprehensive role in the process of internationalisation of the RMB, and strengthening Hong Kong’s position as an offshore RMB centre could help to diversify offshore financial products, as well as strengthen RMB asset risk management operations and support domestic companies “going abroad.”
In terms of concrete proposals, Fan Yifei said that Hong Kong should engage in greater financial innovation in order to satisfy the the needs of the Belt and Road initiative with respect to investment and risk avoidance products.
Ba Shusong (巴曙松), chief economist for the China Banking Association, said to Beijing Business Today that in order to further expand Hong Kong’s offshore RMB market it would be necessary to develop more RMB cross-border and offshore financial products.
Following the continued expansion of overseas RMB assets, the need for RMB asset risk management operations is increasing. According to Ba this is one area where Hong Kong enjoys a strong advantage given its outstanding human resource pool and free and open business environment.
Ba also said that domestic Chinese companies could use Hong Kong to expedite their efforts to expand abroad, especially if the special administrative region expands its RMB products and business.