Business | Markets
Hong Kong missing out on China investments
Fails to take advantage of programme allowing settlement of overseas investments in yuan
- Bloomberg
- Published: 00:00 May 23, 2011
Hong Kong: Hong Kong isn't doing enough to take advantage of a pilot programme that allows mainland Chinese enterprises to settle overseas direct investment in yuan, Hong Kong Exchanges and Clearing Ltd's Chairman Ronald Arculli said.
"There is one aspect that perhaps we don't pay enough attention to and that is the other side of foreign direct investment — ODI," Arculli, head of the world's biggest bourse by market value, said at a symposium in Hong Kong yesterday.
The People's Bank of China, the nation's central bank, in January announced that mainland companies can make direct investments overseas in yuan through Hong Kong. China made Hong Kong its offshore yuan centre to enhance the circulation of the currency internationally for trade and investment.
"There are quite good opportunities for us in Hong Kong, and indeed the world, to take advantage of China's needs over the next decade or so," Arculli said.
Outward direct investment by China between 2008 and 2009 reached $112.4 billion (Dh411 billion), 66 per cent of which was into or went through Hong Kong, the Hong Kong Monetary Authority said in January.
China's cross-border yuan trade settlement in the first four months of the year was 530 billion yuan ($82 billion), exceeding the 500 billion yuan for the whole of 2010, Li Bo, director general of the PBOC's monetary policy department, said on May 19.
China's trade may reach $6 trillion a year by 2015 with about a third of that settled in yuan, HSBC Holdings Plc's head of strategy and planning, Antonio Simoes, said at the symposium, which was organised by Columbia University.
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