The value of the Renminbi (RMB) yuan became larger than that of
the HK dollar on Monday for the first time in history. The central
parity rate was announced at 0.99945 yuan to one HK dollar by the
Chinese Foreign Exchange Trading System.
Chinese experts believe the yuan will maintain its superiority
as it continues to appreciate.
The value of the RMB against the US dollar also reached a new
high on Monday, with a central parity rate of 7.7938 yuan to US$1,
breaking the 7.80 mark.
So far, the RMB against the HK dollar has appreciated by six
percent since the exchange rate system reforms begun by China in
July 2005.
A stronger RMB will bolster economic exchanges between the
Chinese mainland and Hong Kong, said Chinese experts.
Hong Kong's tourism and retail sectors will greatly benefit from
an appreciated yuan, said Han Kui, vice general minister of the
outbound tourism department of the China Youth Travel Service.
Mainland tourists heading to Hong Kong for shopping will have
more spending power as the yuan appreciates, said Han.
Zhang Yansheng, a senior expert with the National Development
and Reform Commission think-tank, said a stronger yuan would make
Hong Kong's high-end technology and services more attractive to the
mainland companies, a boon to the service-led Hong Kong
economy.
"The high-end technology and services were too expensive before
and mainland companies have found it hard to cooperate with Hong
Kong providers," said Zhang.
Official statistics showed exports to the Chinese mainland
accounted for around half of all Hong Kong exports in the first
three quarters of 2006.
Zhang said a more valuable yuan may cause a slight rise in the
amount of poultry and fish products imported into Hong Kong from
the Chinese mainland. However, Hong Kong residents' daily expenses
would not increase much and the rise in prices of these essentials
would be mild, he said.
(Xinhua News Agency January 16, 2007)