Hong Kong Launches Financing Facility to Drive Yuan Use in Business
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Hong Kong will roll out a new yuan financing arrangement backed by a swap line with China’s central bank, aiming to provide longer-term funding for companies and strengthen the city’s role as the world’s top offshore yuan hub.
Hong Kong Chief Executive John Lee announced the measure on Wednesday in his annual policy address, saying the Hong Kong Monetary Authority (HKMA) will channel yuan liquidity into trade, daily operations and capital spending for corporates. He said the city would continue to explore diversified cross-border funding channels to ensure stable, lower-cost access to yuan.
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- Hong Kong will launch a new yuan financing arrangement backed by a swap line with China’s central bank to provide longer-term funding and boost its position as the world’s top offshore yuan hub.
- The initiative aims to address liquidity gaps in Hong Kong’s offshore yuan pool, which reached 938.2 billion yuan by July 2025, and deepen yuan’s use in transactions and financial products.
- Additional measures include expanding yuan-denominated bond issuance, strengthening financial market links, and increasing Hong Kong’s international financial collaborations.
- Since 2003：
- Hong Kong has served as the largest offshore yuan hub, when Beijing allowed personal yuan business in the city.
- 2004：
- Offshore yuan deposits in Hong Kong were 12.1 billion yuan.
- 2012：
- HKMA created intraday and overnight yuan facilities as short-term liquidity tools.
- 2014：
- HKMA designated 11 banks as primary liquidity providers for yuan.
- February 2025：
- HKMA launched a 100 billion yuan trade financing program with maturities of up to six months.
- By July 2025：
- Offshore yuan deposits in Hong Kong reached 938.2 billion yuan, according to the HKMA.
- September 17, 2025：
- Hong Kong Chief Executive John Lee announced a new yuan financing arrangement backed by a swap line with China’s central bank in his annual policy address.
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