Have their say: Chief Executive Donald Tsang says the banking sector should play an active role and express their views and requests before the People's Bank of China finalises the details of the QDII scheme.

Chief Executive Donald Tsang says there should be a boost in renminbi activity in Hong Kong, adding the Government will study the possibility of issuing renminbi bonds in Hong Kong.

Speaking on a radio talkshow this morning, Mr Tsang said since it would take sometime for the renminbi to move towards free convertibility, Hong Kong should enhance the Hong Kong dollar's role by strengthening the relationship between the two currencies.

The Chief Executive suggested the Central Government may consider using Hong Kong dollars instead of US dollar when granting loans to developing countries.

Pegged rate system

When asked whether the Hong Kong dollar would be pegged to the renminbi, Mr Tsang said pegging the Hong Kong dollar to the US dollar is a long-term policy, adding the renminbi's free convertibility is a prerequisite for having a pegged-rate system with the currency.

On the new measures announced under the Mainland's qualified domestic institutional investor - or QDII - scheme, Mr Tsang said the banking sector should play an active role and express their views and requests before the People's Bank of China finalises the details.

Turning to the controversy sparked by the Sai Wan Ho development incident, he said people should look forward and the Government is reviewing the relevant procedures and guidelines to improve the mechanism for exercising discretionary powers.