•  The People’s Bank of China announced in February a widening of the access to the China Interbank Bond Market to a broad range of foreign financial institutions without any quota restrictions. •  And, earlier this month, the Bank announced that it would extend nationwide the pilot measure for cross-border financing by Mainland corporates and financial institutions, with the result that case-by-case pre-approval is no longer required. 12. These initiatives demonstrate the central government’s commitment to liberalising the Mainland’s capital accounts. They also present CFOs and treasurers with new opportunities to meet their business and investment needs. And, there will be more to come. Premier Li Keqiang has said the Shenzhen-Hong Kong Stock Connect will be launched later this year. 13. Secondly, the “China connection” is growing rapidly. Let me briefly explain what I mean by this: in 2014, China’s ODI amounted to $ billion, 10 times the amount in 2005. This number will be even bigger in the years to come as Chinese corporates go global, and as the implementation of the “Belt and Road” strategy helps more Chinese corporates to invest in these countries. At the same time, multinational corporates are paying more and more business attention to China. In 2015, FDI into China reached $ billion, compared to $ billion in 2005. The point here is that with more business opportunities, either because Chinese corporates are “going out” or multinational corporates are expanding into China, comes the need for more sophisticated treasury management. 14.
In-principle support has been received from the Asian Infrastructure Investment Bank, the Asian Development Bank, and the International Finance Corporation under the World Bank Group. And others have also indicated an interest. IFFO will be launched in July and we look forward to sharing with you more information about its work. Corporate Treasury Management 10. I would now like to turn to issues of more immediate concern to you in your treasury management roles, and to share a few factors which I believe are shaping your business:  11. First, the continuing liberalisation of the Mainland’s capital account. As I mentioned earlier, the Mainland authorities have continued to implement measures to liberalise cross-border fund flows. I am sure many of you are familiar with the progress, but let me just quickly name a few key measures introduced in recent years:  2  BIS central bankers’ speeches  •  The Shanghai-Hong Kong Stock Connect has been in place and operating smoothly since November 2014, allowing international investors access to the A-shares listed in Shanghai through the stock exchange in Hong Kong, and vice versa. •  The Mainland-Hong Kong Mutual Recognition of Funds scheme was implemented in July 2015, allowing Mainland and Hong Kong funds to be distributed in each other’s markets through a streamlined approval process. •  The QFII arrangement was refined in February this year by relaxing individual quotas and shortening the investment lock-up period, among other improvements.