MNI INTERVIEW: China Tempts Investors With Green Panda Bonds

     BEIJING (MNI) - China is trying to attract foreign institutional investors

to raise money for green financing initiatives in yuan, which would boost both

its green finance market and its currency internationalisation drive, Ma Jun, a

member of the People's Bank of China's monetary policy committee, told MNI on

the sidelines of the Second Belt and Road Forum for International Cooperation.

     "The Chinese government is encouraging foreign institutions to issue

RMB-denominated panda bonds here," said Ma, a leading promoter of China's green

finance initiative on the global stage.

     The task, though, is still challenging, with only a fraction of more than

$100 trillion of global assets under management allocated to green finance, Ma

said.

     One possibility might be to repackage banks' green loans into asset-back

securities for sale to global institutional investors, Ma noted, adding that

this would require further opening up of China's capital account.

     "We need to provide incentives for market forces and should not rely on

fiscal or government-backed funding," said Ma, who sees potential for the global

green finance market to grow into the tens of trillions of dollars.

--MNI London Bureau; +44 203 865 3829; email: jason.webb@marketnews.com

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