The State Council gave the go-ahead Wednesday for mainland financial institutions to issue yuan-denominated bonds in Hong Kong. The long-awaited move will further widen the scope of yuan business in Hong Kong by allowing mainland institutions to raise the yuan and facilitate the return of yuan circulating in Hong Kong to the mainland, the South China Morning Post reported. Financial Secretary Henry Tang Ying-yen said although yuan bonds' trading would be limited initially, it was an important move to expand yuan business in Hong Kong. A Hong Kong Monetary Authority spokesman said the move would "further promote economic integration between Hong Kong and the mainland," and would help develop the local debt market, helping to build a diversified multi-currency financial infrastructure, which in turn would enhance the city's role as an international financial centre. The date of implementation has yet to be fixed.
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