darryl chan : keynote speech at the bank of china " the belt and road initiative and rmb internationalization forum " keynote speech by mr darryl chan, deputy chief executive of the hong kong monetary authority, at the bank of china " the belt and road initiative and rmb internationalization forum ", hong kong, 6 june 2023. * * * good morning. it gives me great pleasure to join you today at the belt and road initiative and rmb internationalization forum. thank you mr sun and bank of china ( boc ) colleagues for organising this special event. i also look forward to the release of your annual white paper on renminbi ( rmb ) internationalisation. being the first rmb clearing bank with substantial expertise and stake in this subject, boc ( hk ), i am sure, has lots of insights to share with us. today i would like to talk about the opportunities for hong kong as rmb gains wider global acceptance, in particular in the belt & road context, and how hong kong in return can contribute to this process. rmb internationalisation has made great strides in the past decade or so. since the launch of the cross - border rmb trade settlement arrangement in 2009, the channels of cross - border usage have kept expanding - from trade settlement to direct investment, to portfolio investment. conduits that connect onshore and offshore markets have continuously become wider and deeper. by now, a well - developed two - way rmb circulation system is in place, enabling corporates and financial institutions to conduct different types of cross - border rmb transactions based on their needs. such circulation system is getting more frictionless and mature over time, leading to increasing acceptance and use of rmb globally. for example, last year the international monetary fund raised the weight of the rmb in the special drawing rights ; percentage of rmb in foreign exchange market transactions has been picking up ; and lately the share of mainland's external trade settled in rmb has seen renewed momentum. the growth momentum is supported by, and in turn promotes, hong kong's development as the leading offshore rmb business hub. let me share a few data points. today, with total deposit close to rmb 1 trillion, hong kong is home to the largest offshore rmb liquidity pool. this accounts for about 60 % of global aggregate and supports the liquidity needs of other offshore rmb centres. the size of rmb payments routed through hong kong's rmb rtgs

those affected were above all self - employed workers and payroll employees with fixed - term contracts, especially young people and women, who account for a higher share of employment in the sectors most exposed to the crisis. the policies implemented to alleviate its economic effects – such as wage supplementation schemes, the lengthening of the duration of unemployment benefits and the income support measures for selfemployed workers and households in difficulty – have been effective overall, mitigating the shortcomings of the welfare system, due above all to the excessive fragmentation of the instruments available. the surveys conducted by the bank of italy at the end of november suggest that consumption expenditure is being held back by fears of infection, besides the precautionary motive based on economic and financial considerations. the share of households that expect to spend less than their annual income in the next twelve months has increased ; a non - negligible share ( about 20 per cent ) of the households anticipating a decrease in their income also reported that they expect to save. over the course of the month, about 80 per cent of households spent less on tourism and restaurant services compared with november 2019, and reduced the frequency of purchases in clothing stores ; two thirds decreased their spending on personal care services. the contraction for this set of consumption items was greatest in the regions hit hardest by the spread of the epidemic. these indications confirm the importance of a far - reaching and lasting strengthening of the healthcare system and suggest that a fully successful vaccination campaign will be crucial to a stable recovery. the worsening of the health emergency was also reflected in firms ’ assessments of investment conditions, which started to deteriorate again, albeit slightly, in late 2020, especially in some segments of the service sector marked by the presence of a high number of small and micro firms with a limited ability to deal with shocks. our projections point to a recovery in production starting in the spring, although this central scenario hinges crucially upon the progressive attenuation of the epidemic over the course of the coming months. in addition to this, a robust recovery of the economy will require the reactivation of significant plans for investment ; in this respect, a key role will be played by the benefits stemming from a rapid and full implementation of the measures still being drawn up as part of the next generation eu programme. however, it is likely that consumption will pick up slowly, especially in services, owing to the gradual manner in which the uncertainty that drove the propensity to save will be reab