The government of Hainan province has announced plans to issue offshore renminbi bonds worth 5 billion yuan ($702 million) in the Hong Kong Special Administrative Region this September, aiming to deepen cooperation between the island province and the SAR, advance the development of the Hainan Free Trade Port, and contribute to the internationalization of the yuan.

This year marks the fourth consecutive year that Hainan has issued offshore RMB bonds in Hong Kong. A global investor conference was held on Thursday at the Hong Kong Monetary Authority (HKMA) to provide more details about the issuance.

In addition to three-year green bonds and five-year blue bonds, this year will feature the inaugural issuance of a 10-year aerospace bond, with a portion of the proceeds allocated to infrastructure development at Hainan’s Wenchang Spacecraft Launch Site.

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Feng Fei, secretary of the Hainan Provincial Committee of the Communist Party of China, stated that the issuance of the bonds represents a significant initiative to empower the development of Hainan’s key industries through financial means. It also deepens cooperation between the province and Hong Kong, providing investors with diverse opportunities for high-quality RMB asset investments.

Feng said that Hainan places great importance on cooperation with Hong Kong. The signing of the Hainan-Hong Kong Memorandum of Cooperation in March marks a new phase of high-level, comprehensive collaboration between the two places, he added.

Feng said 10 measures have been introduced to open Hainan Free Trade Port’s professional services market to Hong Kong, further advancing resource sharing, market connectivity, industrial integration, transportation interconnection, and cultural exchange.

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Hong Kong Financial Secretary Paul Chan Mo-po believes the issuance of the aerospace bond will bring the nation’s key aerospace research projects into the spotlight of international investors through the SAR, enhancing the visibility of the nation’s cutting-edge technologies.

He added that this initiative contributes to enriching the range of RMB bonds and investment products, further advancing the internationalization of the yuan.

Bookbuilding for the bonds, which will be listed on the Stock Exchange of Hong Kong, is set to begin on Friday.