语言切换
CN
EN
jp
News

"Bond Link" promotes the two-way opening of the financial market

Date: 2022-10-08
Views: 1

Recently, the first anniversary of the opening of 'Bond Connect' to Southbound Connect was ushered in. Southbound is a mechanism arrangement for mainland institutional investors to invest in Hong Kong's bond market by connecting the mainland and Hong Kong's basic service institutions. Over the past year, the trading volume of Southbound Express has been increasing and investors have become increasingly active, which not only increases the investment channels of mainland institutional investors, but also helps to steadily promote the two-way opening of China's financial market.

Promoting the opening of the bond market to the outside world is an inevitable requirement for China to build a market-oriented and open financial market system. In July 2017, 'Bond Pass' was 'opened to traffic' to the north; In September, 2021, 'Bond Connect' opened to the south. China has gradually promoted the opening of 'bond link' to the north and to the south, and through the infrastructure system connection between the mainland and Hong Kong, it is convenient for overseas institutions to 'access' China's bond market, which helps to play the role of 'price anchor' and 'reservoir' of the bond market, and provides support for promoting China's international balance of payments, foreign exchange market stability and RMB internationalization.

With the steady opening of the bond market, the vitality of the market is obviously enhanced, and its international influence is increasing day by day. In recent years, the types of investors in China's bond market have been constantly enriched, and the number has increased steadily. In 2005, the International Finance Corporation and the Asian Development Bank were allowed to issue RMB bonds in the inter-bank bond market, and the Pan-Asian Fund and the Asian Debt Fund began to invest in the market. In 2010, the scope of overseas institutional investors who can enter the market was expanded to overseas central bank institutions, overseas RMB clearing banks and participating banks, and in 2016, it was further expanded to overseas licensed financial institutions and long-term institutional investors such as pension funds. By the end of May 2022, there were 1,038 overseas institutions entering the interbank market, covering more than 60 countries and regions such as the United States, Canada, Britain, France, Germany, Italy, Japan, Singapore and Australia.

In July this year, the launch of 'Swap Link' marked another important milestone in the high-quality development of China's bond market. For foreign investors, the 'swap line' does not change the existing overseas trading habits and improves the convenience of foreign investors' participation; The centralized clearing mechanism can effectively improve the credit risk management efficiency of foreign investors' counterparties and reduce the cost. At the same time, 'Swap Link' provides the convenience of efficient and diversified risk hedging, and further supports foreign investors to expand their investment demand for RMB bonds. For China's bond market, 'Swap-through' will improve the efficiency of risk hedging and optimize the cross-border investment environment. It will attract more foreign investors to enter the market, enrich the types of investors, increase the transaction scale, improve the transaction liquidity in market expansion, improve the institutional environment in business interaction, deepen market opening and cross-border cooperation with high quality, and promote the internationalization of RMB.

With the first anniversary of Nantong as a new starting point, the opening door of the bond market will be wider and wider. In the next step, China's bond market will still focus on building a multi-level market system with high efficiency and connectivity, and cultivate a diversified team of qualified investors; Accelerate the orderly connection of infrastructure in the bond market and realize the free circulation of elements. At the same time, we should consolidate the legal foundation of the bond market, strengthen supervision and coordination, and strengthen risk prevention and control. On this basis, the bond market will be further promoted to gradually shift from factor flow opening to institutional opening such as rules. We will improve macro-prudential management, strengthen the supervision of cross-border capital flows, do a good job in real-time monitoring of market operations, and build a systematic risk monitoring, assessment and early warning mechanism. On the basis of ensuring financial security, we will steadily promote the reform, opening up and high-quality development of the bond market.


Copyright ©2005 - 2013 中投建设集团有限公司
  犀牛云提供企业云服务
Beijing Shanghai Guangzhou Chongqing Fuzhou Chengdu Nanjing Hangzhou Ningbo Haikou Suzhou Shenzhen Hongkong Frankfurt Toronto Melbourne Taiwan
400-857-5885

邮编:330520