China's Ministry of Finance issued yuan-denominated treasury bonds worth 2 billion yuan ($291 million) in Macao on Thursday, the first yuan-denominated Chinese Treasury bond sale in the special administrative region, according to a statement on the ministry's website on Friday.

The bonds include 1.7 billion yuan worth of three-year institutional notes at 3.05 percent and 300 million yuan worth of two-year bonds at 3.3 percent for local retail investors, according to the ministry.

The bond issuance is in recognition of the 20th anniversary of Macao's return to the motherland, Zou Jiayi, vice finance minister, said at the issuance ceremony held on Friday. Zou also said that it will help to support Macao's financial development, enhance its economic and financial ties with the mainland, and allow Macao's economy to be further involved in the international market.

Zou added that retail treasury bonds are a direct way for Macao residents to participate in China's economic development and share in the dividends of China's economic growth. 

As industry structure in Macao is comparatively singular, the move will provide local investors with more sound and stable investment options, Dong Dengxin, director of the Financial Securities Institute at the Wuhan University of Science and Technology, told the Global Times on Friday. Macao has long relied on the gaming industry, which is its main revenue source. 

However, Dong said that even though Macao lags behind Hong Kong in the development of its capital market, it's possible that Macao could catch up through using this opportunity to build itself into a third market for the central government to issue yuan-denominated bonds overseas.

China's government bonds are quite attractive to international investors, Dong noted.

According to a report from the Xinhua News Agency, the government bonds have been welcomed by institutional investors from both Macao and global investors from Portuguese-speaking countries, with a total subscription size exceeding 5.4 billion yuan.

"China has been opening up its treasury market to foreign countries, and Macao could help the central government to achieve that thanks to its free and open platform," Dong said.

Global Times