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China 'bond connect' talk overlooks landmark market opening

Hundreds of foreign investors are already buying domestic interbank debt

| China
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Shanghai-Hong Kong Stock Connect provides for mainland flows into Hong Kong-listed equities and allows overseas investors access to Chinese domestic shares.   © Reuters

Chinese Premier Li Keqiang has dangled a carrot for Hong Kong markets. At the press conference to close the annual National People's Congress session in Beijing on March 15, he floated a trial proposal to expand the Stock Connect link between Hong Kong and the stock markets of Shanghai and Shenzhen to include access to mainland bonds.

It sounded like a big deal. But while many international investors have yet to notice, Chinese authorities have already fully opened the country's bond market to foreign institutions. More than 200 investors have applied for access and are already trading the instruments.

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