Journal Issue
Share
Article

People’s Republic of China—Hong Kong Special Administrative Region: Staff Report for the 2014 Article IV Consultation Discussions—Informational Annex

Author(s):
International Monetary Fund. Asia and Pacific Dept
Published Date:
May 2014
Share
  • ShareShare
Show Summary Details

Fund Relations

Membership Status

As a Special Administrative Region of the People’s Republic of China, Hong Kong SAR is not a member of the Fund. However, annual consultation discussions have been held with the Hong Kong SAR authorities since October 1990, and the staff also holds discussions with the authorities in connection with the Fund’s Global Financial Stability reports. STA has provided Hong Kong SAR with technical assistance in the area of balance of payments statistics and Hong Kong SAR officials have attended IMF Institute courses on balance of payments and monetary statistics, and financial programming. The authorities requested an FSAP, which has been undertaken in conjunction with the 2014 Article IV consultation.

Exchange Rate Arrangement

The Hong Kong dollar has been linked to the U.S. dollar under a currency board arrangement, the Linked Exchange Rate System (LERS), since October 1983 at a rate of HK$7.8/US$1. The Hong Kong Monetary Authority (HKMA) refined the operations of the LERS in May 2005—the first changes since September 1998. For the first time since the introduction of the LERS in 1983, the HKMA explicitly committed to sell Hong Kong dollar at a preannounced price (set at HK$7.75/US$), which is referred to as the strong-side convertibility undertaking. Previously, the HKMA had only committed to buy Hong Kong dollar at a preannounced rate (the weak-side convertibility undertaking introduced in October 1998) and could sell Hong Kong dollar at any price. Along with this two-way convertibility undertaking, the HKMA also introduced a symmetric trading band of 0.6 percent around a central parity of HK$7.8/US$. There are no restrictions on current or capital account transactions in Hong Kong SAR, and the Hong Kong dollar is freely convertible. The People’s Republic of China accepted the obligations under Article VIII, Sections 2, 3, and 4 of the Articles of Agreement on December 1, 1996.

Resident Representative

The Hong Kong SAR sub-office of the Beijing Resident Representative’s office was opened on September 23, 2000. Shaun Roache is the current Resident Representative.

Statistical Issues

Data provision is adequate for surveillance purposes. Hong Kong SAR provides statistics to the Fund on a timely basis for surveillance and publication in the International Financial Statistics (IFS). Hong Kong SAR subscribes to the Fund’s Special Data Dissemination Standard and is fully compliant with its requirements.

Hong Kong SAR publishes comprehensive balance of payments data and international investment position statistics for 2000 onwards, and also publishes quarterly external debt statistics according to the recommendations given in the External Debt Statistics: Guide for Compilers and Users.

Hong Kong SAR reports both cash and accrual-based annual data for the general government according to the Fund’s Government Finance Statistics Manual (GFSM1986 and GFSM 2001, respectively). No subannual data are provided for publication in the IFS.

Hong Kong SAR participates in regular reporting of Financial Soundness Indicators (FSIs) to the IMF for dissemination. The reported data are quarterly and cover all core FSIs and 12 additional FSIs for the deposit takers sector.

In late 2009, the HKMA began reporting quarterly monetary data using Standardized Report Forms (SRFs) that present data consistent with the Monetary and Financial Statistics Manual. However, the SRF data for Hong Kong SAR have not been published in IFS, which uses monthly data periodicity.

Table 1.Hong Kong SAR—Table of Common Indicators Required for Surveillance(As of March 31, 2014)
Date of Latest ObservationDate ReceivedFrequency of Data5Frequency of Reporting5Frequency of Publication5
Exchange ratesMar. 2014Mar. 2014DDD
International reserve assets and reserve liabilities of the monetary authorities1Jan. 2014Mar. 2014MMM
Reserve/base moneyJan. 2014Mar. 2014MMM
Broad moneyJan. 2014Mar. 2014MMM
Central bank balance sheetJan. 2014Mar. 2014MMM
Consolidated balance sheet of the banking systemJan. 2014Mar. 2014MMM
Interest rates2Mar. 2014Mar. 2014DDD
Consumer price indexJan. 2014Mar. 2014MMM
Revenue, expenditure, balance and composition of financing3Jan. 2014Mar. 2014MMM
Stocks of central government and central government-guaranteed debt4Jan. 2014Mar. 2014MMM
External current account balanceQ4/13Mar. 2014QQQ
Exports and imports of goods and servicesQ4/13Mar. 2014QQQ
GDP/GNPQ4/13Mar. 2014QQQ
Gross external debtQ4/13Mar. 2014QQQ
International investment positionQ4/13Mar. 2014QQQ

Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.

Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.

Foreign, domestic bank, and domestic nonbank financing.

Including currency and maturity composition.

Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A); Irregular (I); Not Available (NA).

Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.

Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.

Foreign, domestic bank, and domestic nonbank financing.

Including currency and maturity composition.

Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A); Irregular (I); Not Available (NA).

Other Resources Citing This Publication