News & Insights

Mainland China briefing: recent developments in cross-border channels: Southbound trading of the Bond Connect scheme expected to be launched within 2021

As stated in the 2021-22 Budget, the Hong Kong Government is planning to expand the Bond Connect scheme to cover both southbound and northbound trading. The Hong Kong Monetary Authority and the People’s Bank of China have set up a working group to drive the initiative of southbound trading of Bond Connect, with the target of launching it within this year.

Bond Connect is an initiative launched in 2017 for mutual bond market access between Hong Kong and Mainland China, under which eligible foreign investors are able to invest in bonds circulated in the China Interbank Bond Market through the northbound trading of Bond Connect. So far, the southbound scheme has not been implemented and Mainland China investors have not been able to invest in the offshore bond market in Hong Kong. Southbound trading aims to facilitate Mainland China investors in making diversified asset allocation, and it presents enormous opportunities for Hong Kong’s financial industry.

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Taylor Hui

Partner | Financial Services

Email or call +852 2826 5368

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