channels for interaction with global financial markets would broaden and become more efficient. over the past decade or so, as china rose to become the second largest economy, we have all seen the changes to world economic relationships brought about by china ’ s integration into the global economic system. we are now beginning to see china ’ s integration into the global financial system in a more prominent way. 6. until now, the channels for cross - border flows are only open to current account items such as trade, and to direct investments under the capital account. portfolio investments under the capital account into and out of china are mainly confined to designated channels and are subject to quotas, for example, the qualified foreign institutional investor ( qfii ) scheme with quotas totalling us $ 150 billion, and the qualified domestic institutional investor ( qdii ) scheme with quotas of us $ 87 billion. it can be reasonably expected that a further opening of the capital account would entail liberalisation of these channels and the addition of new avenues. these would result in an increase in cross - border capital flows. bis central bankers ’ speeches 7. although it may not be easy to provide a precise estimate of the magnitude of the flows, given that china ’ s economy is the second largest in the world, and taking into account the size of both its domestic savings and its capital markets, one can probably say that the size of capital flows resulting from china ’ s capital account liberalisation would likely be felt in the global financial system. 8. from the perspective of chinese savers, given their high level of savings and the fact that their investment options are mostly limited to domestic markets at present, there would be a desire on their part for investment diversification into international markets. the resulting investment flows, as they are liberalised, could be substantial for individual markets where these funds flow into. 9. in the other direction, with china being a dynamic and sizable economy, the world ’ s investors would be increasingly keen about participating in china ’ s capital markets, thereby gaining exposure to new investment opportunities. the experience of many other economies also suggests that capital - account liberalisation brings along with it a deepening of financial markets, making them even more attractive to investors. 10. in all of this, the role of the rmb will be crucial. notwithstanding the current, only partial convertibility of the rmb, it is already the ninth most actively traded currency according to the latest bank for international settlements triennial survey. and

major global asset owner, we have incorporated esg considerations in our investment, and have set a target of net - zero emissions by 2050 for the exchange fund's investment portfolio. we have been investing in green, social and sustainability bonds since 2015, and increased the number of esg - themed mandates in our externally managed portfolios. in fact, the exchange fund's exposure to carbonintensive assets is consistently lower than that of the broader market. it goes without saying that tackling climate change requires consistent and collaborative efforts, and we are keenly aware that we need to lead by example. we have been assisting the government in issuance under the green bond programme, and in beefing up our knowledge, talent and data. hong kong's first green week, which covers a wide range of sustainability - themed activities this week, is part of our broader efforts to promote sustainable development and green finance in the region. i hope that you have been able to find time to attend events in the green week and connect with one another. the third trend is technology, which is revolutionising many parts of the economy, including the financial sector. we are approaching technology from a few different angles. being hong kong's central banking institution, central bank digital currency ( cbdc ) is naturally of great interest to us. one of our most important projects in this field is project mbridge. it is a collaboration between us and the central banks of mainland china, thailand and the uae, under the auspices of the bis innovation hub. the idea is to use cbdc to cut the cost and time of cross - border settlement. we are looking to launch the minimal viable product shortly. wearing our hat as a banking supervisor, over the last few years, one of our priorities has been to encourage banks to apply new technologies in their operations, to enhance the customer experience and, at the same time, ensure robust compliance and risk management. for example, an area where we see great promise is the adoption of ai in areas such as remote customer onboarding, fraud monitoring and cyber defence. we are encouraging banks to make the best use of them. another mandate of the hkma is to promote market development. here we have been supporting the government's efforts in promoting the development of our virtual assets market. virtual assets is an area where i believe regulation and market development 3 / 4 bis - central bankers'speeches go hand - in - hand and reinforce each other, particularly in light of recent market