New | Chinese currency’s inclusion in IMF basket a ‘historic opportunity’ for Hong Kong
Hong Kong can play a pivotal role in facilitating the use of the yuan as a currency for international settlement, leveraging its unique position to become a leading offshore trading hub, according to the city’s de facto central bank chief.
“The International Monetary Fund’s decision to include the yuan in its list of reserve currencies confirms that yuan is a freely usable currency and also enhances the representativeness of the Special Drawing Rights (SDR). It marks a key milestone in yuan internationalisation,” said Hong Kong Monetary Authority chief executive Norman Chan Tak-lam.
Since 2003, Hong Kong has played a vital role in Beijing’s yuan reforms. The city’s banks were the first to be allowed to conduct individual yuan bank deposit and remittance services. In 2009, Hong Kong was also the first city worldwide to provide yuan trade settlement services, marking the beginning of the internationalisation of yuan.
Chan said the inclusion in the SDR currency reserve basket would benefit Hong Kong as a hub for offshore yuan trading.
READ MORE: International Monetary Fund approves reserve currency status for China’s yuan
“Being the largest offshore yuan business centre with close economic and trade ties with mainland China, Hong Kong should seize this historic opportunity and continue to strengthen our financial market infrastructure, as well as upgrade our talent pool and products,” Chan said.