BEIJING, June 19 -- Zhejiang Yongan Futures Broker Co. is set to become the mainland's first futures firm to trade outside mainland markets through a joint venture inked Friday with Hong Kong brokerage Sun Hung Kai & Co.

Yongan is one of six futures brokerages approved to operate in Hong Kong as part of the Central Government's reforms to allow qualified domestic firms access to overseas markets.

The venture, China Xin Yongan Futures Co., will allow Yongan's domestic clients to trade commodity futures and Hang Seng index futures.

The two companies expect Hong Kong's approval for the venture to take up to two months, their top officials said. Yongan will have 75 percent and Sun Hung Kai 25 percent of Xin Yongan, which is capitalized at HK$10 million (US$1.3 million).

Yongan expects to initially tap business from the Hong Kong branches of its clients in the province of Zhejiang in eastern China, a region known for being the country's cradle of modern private enterprise.

"This venture provides us with a platform," said Yongan president Shi Jianjun. "In the future, whatever opportunity opens for us, Chinese investing in foreign markets or foreigners in Chinese markets, we will be ready for it with this platform."

The Central Government has already granted approval for more than 30 of the mainland's largest grains and raw materials companies to trade overseas futures. Many other companies and individuals do so through unofficial channels, but new reforms will create formal means for them to hedge against risk.

(Source: Shenzhen Daily/Agencies)