Deputy Governor of the People's Bank of China (central bank) Hu Xiaolian said Thursday that the State Council is making a study of further expanding the scale of Renminbi service in Hong Kong.

Addressing the forum on Economic and Trade Cooperation and Development between the Chinese mainland, Hong Kong and Macao, she said the new policies are expected to include allowing Renminbi payment of HK businessmen for direct import from the Chinese mainland and mainland financial institutions' trial issuing of Renminbi financial bonds in Hong Kong.

She said the central bank is making close contacts with the Hong Kong Monetary Authority to prepare for launching the business.

With the approval of the State Council, China's banking regulators issued rules for qualified mainland banks to manage wealth within certain limit on behalf of their clients in April this year, she said.

The announcement was jointly made by the People's Bank of China and the State Administration of Foreign Exchange.

She said related departments are making preparations for the launching of the business. A number of banks, including Hong Kong-based banks, have already applied for launching the business.

She believed that the launching of the new business will provide more opportunities for Hong Kong's financial institutions and financial market.

She said because Renminbi business had been launched in Hong Kong banks since November 2003, capital settlement has been going on smoothly, which facilitates the economic and trade exchanges between the Chinese mainland and Hong Kong and helps the orderly channeling back of Renminbi.

By the end of May, the balance of clearing of Hong Kong's Renminbi settlement banks at the Shenzhen Branch of the People's Bank of China reached 22.7 billion yuan (about 2.84 billion U.S. dollars), and the amount of settlement of mainland bankcards with consumption in Hong Kong came to 14.6 billion yuan (about 1.87 billion U.S. dollars).

Source: Xinhua