Hong Kong will be leading global offshore renminbi trading hub in 2013

China's campaign to internationalize the renminbi will benefit Hong Kong immensely.

Analysts said Hong Kong's strategic position adjacent to China makes Hong Kong the natural offshore center for trading the renminbi or yuan. Renminbi deposits have grown to over US$80 billion, an eight-fold over the past three years.

The Hong Kong Stock Exchange also launched two renminbi-denominated IPO's in 2011 and 2012.

Official figures also show US$40 billion dim sum bonds have been issued in Hong Kong, and bought by investors wanting exposure to renminbi-denominated assets but who are restricted from investing directly in mainland China.

One analyst said the market is growing and expanding into new asset classes such as futures on the currency traded on the stock exchange, and gold futures.

Worries about a recession in China last year and the renminbi’s weakening against the U.S. dollar slowed down Hong Kong’s growth as an global offshore yuan trading hub.

Economists predict the renminbi will appreciate between 2% to 2.5% against the U.S. dollar in 2013. That should re-ignite interest in the market, with deposits possibly bouncing back to some US$104 billion.