Premier Li Keqiang announced today that the State Council has approved the implementation plan for Shenzhen-Hong Kong Stock Connect. The Hong Kong Special Administrative Region Government is grateful for the decision.
The HKSAR Government also welcomes the joint announcement by the China Securities Regulatory Commission and the Securities & Futures Commission on the approval in principle of the structure of Shenzhen-Hong Kong Stock Connect.
Financial Secretary John Tsang said the establishment of Shenzhen-Hong Kong Stock Connect is beneficial for both sides.
“This will facilitate the further opening-up of the capital markets of the Mainland in a risk controlled manner and promote the internationalisation of renminbi. I am pleased that Hong Kong continues to play a significant role in the two-way opening-up of the Mainland's capital markets to the rest of the world.
“At the same time, the initiatives will enable international investors to invest more widely in the Mainland's markets through Hong Kong's markets, thereby reinforcing Hong Kong's position as an international financial centre and a premier offshore RMB hub, and creating better conditions for the further development of Hong Kong’s financial services sector," Mr Tsang said.
The joint announcement said it would take about four months to complete the preparations for the formal launch of the measure and there will be no aggregate quota under Shenzhen-Hong Kong Stock Connect.
The aggregate quota under Shanghai-Hong Kong Stock Connect is also abolished with immediate effect.
The CSRC and the SFC have also reached a consensus to include exchange-traded funds as eligible securities under the mutual market access scheme. A launch date will be announced separately after the Shenzhen-Hong Kong Stock Connect has been in operation for a period of time and upon the satisfaction of relevant conditions.
In addition, to facilitate and meet the need of Mainland and Hong Kong investors to manage price risks in one another's stock markets, the CSRC and the SFC have agreed in principle to jointly study and introduce other financial products.
Mr Tsang also welcomed the further expansion of the scope of eligible securities for trading in the mutual market access scheme as it will further facilitate investors and provide them with more investment choices.
The Hong Kong Monetary Authority said the move will further facilitate two-way investment flows and consolidate Hong Kong’s development as the global offshore RMB business hub.
The Authority will continue to closely monitor market development and provide RMB liquidity support when necessary.
