Hong Kong bankers say reforms will help establish Qianhai as yuan centre

Moves to create the "Manhattan of the Pearl River Delta" on a patch of reclaimed land west of Shenzhen kicked off with a bang last month, and bankers are bullish over prospects for the future financial hub.

The Qianhai experimental zone, which was given a top-level seal of approval in the form of president-to-be Xi Jinping's southern tour soon after he became Communist Party general secretary last year, has been mooted since 2010 as a testing ground for economic liberalisation.

While some in the financial industry believe the 15-square-kilometre development will prove to be no more than a minor project, others believe it will provide Hong Kong financial firms with a window of access to the country as a whole.

HSBC Hong Kong chief executive Anita Fung Yuen-mei hailed the Qianhai project as a milestone for the opportunities it presents.

"It will allow banks in Hong Kong to offer cross-border yuan loans to Qianhai companies," Fung said. "This is a breakthrough development that will benefit not just the banks, but it also marks an important step forward in the internationalisation of the yuan,"

In December, the People's Bank of China's Shenzhen branch announced provisional regulations allowing firms registered in Qianhai to take out yuan-denominated loans from Hong Kong banks.