HSBC expects the demand for onshore Chinese government bonds to increase fivefold in the next two years.

With such increase, the share of foreign buyers may jump to 10 percent of the market, infusing $100 billion into the second largest economy in the world.The stake held by overseas investors in onshore government bonds market has increased by $15 billion since March.

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HSBC CEO Stuart Gulliver said foreign investors currently constitute two percent of the onshore government bond market in China. He said the controlled and progressive reforms in China are expected to increase the speed of capital inflows and outflows in the country.

The company executive continued to emphasize that reforms may also lead to easier procedures for Chinese residents to acquire foreign assets.

Meanwhile, it can be noted that Chinese companies have been involved in overseas M&A worth $170 billion this year so far, up from $100 billion worth of investments in 2015.

Gulliver said the nature of such acquisitions is changing due to the sheer size of Chinese economy and its increasing focus on services and consumption.

HSBC is currently looking to boost its presence in China, as it waits for the regulatory approval of its joint venture with Shenzhen Qianhai Financial Holdings, which was announced last year. It expects to start operating within six months from the approval's release.

In another survey, HSBC found that a large number of foreign companies are not making full use of the Chinese government's infrastructure initiatives, thus, missing out on the various opportunities.

The survey showed that while 41 percent of the companies were aware of the opportunities, only seven percent were executing the plans to capitalize on these prospects. 

TagsHSBC, Government Bond, china