English
Bond Connect is a mutual bond market access scheme between Chinese Mainland and Hong Kong, built to promote the development of both bond markets. Architected jointly by the People's Bank of China (PBoC) and the Hong Kong Monetary Authority (HKMA), Bond Connect embodies the mission to seamlessly connect Chinese Mainland with global markets, closing the circle between onshore and international market participants.
In 2017, a market infrastructure linkage was formed, where China Foreign Exchange Trade System & National Interbank Funding Centre (CFETS), China Central Depository & Clearing Co., Ltd (CCDC), Shanghai Clearing House (SHCH), and Cross-border Interbank Payment System Co., Ltd (CIPS) (together the "Mainland Financial Infrastructure Institutions"), together with Hong Kong Exchanges and Clearing Limited and the Central Moneymarkets Unit (CMU) of the HKMA, established Bond Connect.
The initial phase, Northbound Trading, commenced on 3 July 2017, allowing overseas investors from Hong Kong and other countries and regions (“Overseas Investors”) to trade, settle, and hold debt securities tradable in the China Interbank Bond Market (CIBM) through this market infrastructure linkage. This initiative demonstrated the CMU's role in propelling Hong Kong's debt market with unparalleled connectivity and efficiency.
Since its inception, Northbound Trading has been well received by international investors, attracting significant capital flows into Mainland financial markets and creating enormous opportunities for Hong Kong's financial institutions. This success laid a strong foundation for the launch of Southbound Trading.
On 24 September 2021, the scheme extended to Southbound Trading, enabling Mainland institutional investors to invest in the Hong Kong bond market. Bond Connect abides by the relevant laws and regulations of both Chinese Mainland and Hong Kong, ensuring a secure and compliant investment environment.
