People use their smartphones along the Victoria Harbour waterfront in Tsim Sha Tsui district in Hong Kong, China, July 7, 2020. (PHOTO / BLOOMBERG)
The Chinese mainland issued rules for public comment on Wealth Connect, marking a big step forward for the program that will allow investments across the border between the Hong Kong Special Administrative Region (HKSAR) and the nation’s increasingly affluent southern region.
Mainland investors with at least two years' investment experience and with more than 1m yuan in net household financial assets in most recent three months will be qualified
The People’s Bank of China released a detailed set of instructions for public comment late Thursday, posting a May 21 deadline for feedback.
As revealed earlier by Hong Kong authorities, the program for individual investors will have a 150 billion yuan (US$23 billion) cap in each direction, according to the draft rules. Mainland investors with at least two years' investment experience and with more than 1 million yuan in net household financial assets in most recent three months will be qualified.
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The announcement “marks another encouraging step towards the opening of mainland China’s capital markets and reinforcing Hong Kong’s status as an international financial centre,” Daniel Chan, the head of Greater Bay Area at HSBC Holdings Plc., in a statement.
HSBC and rivals have been beefing up their presence in anticipation of the plan, one of the building blocks in strengthening the Greater Bay Area, a region including Hong Kong and Macau SARS and nine other cities that has more than 70 million people. The long-awaited program was announced without details in June last year.
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The authorities aim to roll out the program in the early part of the second half this year, Hong Kong Monetary Authority Chief Executive Eddie Yue said earlier this week.
Hong Kong has sought to reassure investors it will remain a stable place, with Chief Executive Carrie Lam lobbying for more financial integration to build the city’s presence as a hub for private wealth and as a prominent offshore renminbi center.