On the Benefits and Problems of the Offshore RMB Bonds in Hong Kong and Macao Issued by Local Goverments in China

Abstract

Offshore RMB bonds, as an important component of China's financial market construction and opening-up, have received attention and research from multiple parties. At present, the governments of Guangdong Province, Shenzhen Municipality, and Hainan Province in China have issued offshore RMB bonds in Hong Kong and Macao. These bonds can broaden the government's offshore financing channels, facilitate government participation in offshore RMB transactions, and promote the development of RMB internationalization. At the same time, as the issuance of offshore RMB bonds is still in the exploratory stage and there are still certain problems, it is necessary for the central and local governments to work together to improve specific policy measures for offshore RMB bonds, optimize cross-border issuance processes, and prepare emergency plans for bond repayment, in order to make the offshore RMB bond market legal, compliant, and thriving.