Central gov’t to issue RMB3b in bonds, aiming to internationalize RMB

The central government is once again issuing government RMB-
denominated bonds in Macau.

This time, the issuance has a face value of RMB3 billion and will take place next week on September 7, the Ministry of Finance of the People’s Republic of China announced.

In a statement, the local government said that the issuance of the RMB bonds aims to offer a fresh investment option for professional investors, as well as to promote the progress of the internationalization of the Chinese currency through the Macau offshore RMB market.

The same statement also noted that the initiative will support Macau in its bid to establish a modern finance industry and the city’s effort at adequate economic diversification.

The central government also hopes the initiative will reinforce cooperation in financial services between the mainland and Macau, as well as attract a greater number of bond issuers and international investors to participate in the development of the local bond market which will, in turn, enrich the financial products offered in Macau as a bond market.

The measure was well received by the local government who praised the central government initiative.

The first time the central government announced the issuance of RMB bonds in Macau was July 2019, when RMB2 billion was launched, the first offshore issuance.

The issuance, named “lotus bonds,” was not, however, the first RMB-denominated debt issued in Macau; the first such issuance was in February 2018 by the Bank of China – Macau.  This issuance totaled RMB4 billion.