China continues to boost opening-up of bond market

China will continue to boost the opening-up of the bond market and create a more friendly and convenient investment environment for global investors, according to the central bank.

By the end of February, overseas issuers had issued 381.6 billion yuan (about $54.51 billion) of "panda bonds," or yuan-denominated bonds issued in the Chinese onshore market by overseas issuers, the People's Bank of China (PBOC) said.

A total of 814 overseas corporate institutional investors had entered the inter-bank bond market, holding 2.3 trillion yuan of bonds, by the end of February.

China's bond market has accelerated opening up since 2019 with expanding issuance scale of panda bonds, and the launch of Silk Road-themed bonds and the Belt and Road Initiative bonds, according to the PBOC.

More foreign-funded institutions have been allowed to enter the inter-bank bond market to carry out bond underwriting and rating business.

Procedures have been simplified for overseas institutions to enter the market and the settlement cycle has been extended to create a more convenient environment for overseas investors, it said.

China has integrated the Qualified Foreign Institutional Investors (QFII) program and the RMB Qualified Foreign Institutional Investors (RQFII) program as well as the direct market entry channels, while allowing overseas investors to choose a number of domestic financial institutions to trade over the counter and hedge foreign exchange risks through principal brokers or directly entering the inter-bank foreign exchange market, the PBOC said.