Broadening and deepening a capital market is one of the keys to accelerating growth and advancing a sustainable development programme.
Today, I am continuing the thinking from my last post on sustainable Asia development by focusing on how countries are creating the conditions in which both the private and public sectors can borrow or raise capital efficiently. This is good for employment and it gives governments more scope for development.
This is echoed by the recent Bond Connect – the Chinese bond trading link that brings the world’s third-largest debt market one step closer to international investors’ portfolios.
This could prove to be big new news for China and international investors if the bonds secure inclusion in global bond indices. In fact, Stock Connect, has helped Chinese equities gain entry to the MSCI’s emerging markets index.
So, it’s good news for China and diversification for international investors with analysts predicting more than USD 1 trillion of offshore bond funds could flow into Chinese debt in the next decade.