Paul Chan: Northbound Scheme's average daily turnover reaches RMB 46.6 billion

Hong Kong's Financial Secretary, Paul Chan, highlighted the success of the Northbound Scheme of Bond Connect during his speech at the Bond Connect Anniversary Summit today (July 9).

Launched seven years ago, the Northbound Scheme has become a convenient channel for global investors to enter the Chinese bond market and a primary means for offshore investors to allocate onshore bond assets.

Chan stated that as of May this year, the Northbound Scheme's average daily turnover has steadily increased from RMB 1.5 billion to approximately RMB 46.6 billion per month, marking a more than 30-fold increase. This platform has become a major avenue for offshore investors to allocate onshore bond assets. Last year, international investors traded over RMB 15 trillion in onshore bonds, with about two-thirds of these transactions conducted through the Bond Connect.

Chan also mentioned that the launch of the northbound interest rate swap services in May last year has enabled offshore investors to manage better the interest rate risks of bonds and various RMB assets, complementing the development of the Bond Connect.

As of June this year, Swap Connect's average daily nominal principal reached RMB 13.5 billion, more than four times the amount when it was launched in May last year. Additionally, Chan noted that the Shanghai-Shenzhen-Hong Kong ETF Connect expansion will be officially implemented on July 22, further enriching the product choices for both onshore and offshore investors. This expansion is expected to attract more capital flows into the capital markets of both regions, contributing to their long-term development.