The Qianhai Equity Trading Center, which is expected to begin operating this month, will provide loans to Qianhai enterprises by launching RMB-denominated wealth management products in Hong Kong.
The yields of those financial products may reach 10 percent because of the higher risk of the small- and medium-sized enterprises in Qianhai, a financial pilot area in Shenzhen, Guangdong province, Hong Kong media reported.
Private banking clients as well as private equity firms in Hong Kong will be the target group of investors.
"In further relaxing currency flows between Qianhai and Hong Kong, offshore investors now have an additional avenue into RMB investments," said Nathan Chow, an economist with the DBS Bank Ltd.
SMEs on the Chinese mainland, especially those that have long struggled to raise funds from the large state banks, will also benefit, Chow said.
"Following the launch of CNH trust products and cross-border loans, the scope of RMB business between Qianhai and Hong Kong will be further enhanced, and individual investors in Qianhai may be allowed to participate in the pilot program to directly invest in the overseas markets, or the so-called RQDII2," he said.
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