The Financial Secretary Paul Chan Mo-po delivers his speech at the Asian Logistics, Maritime and Aviation Conference 2023 on Nov 21 in Hong Kong. (PHOTO / HKSAR GOVERNMENT)

Officials and financial pundits on Tuesday said financial security is Hong Kong’s top priority while the city developing its pillar industry in the face of global slowdown and rising geopolitical tensions. 

“Under the major changes in the international community, the first and foremost task of Hong Kong's development is to ensure financial security, which is under cross-market, interlinked and continuous 24-hour surveillance,” Financial Secretary Paul Chan Mo-po said during his speech at an annual forum held by the Chinese Financial Association of Hong Kong.

The property tycoon added that deglobalization is already underway and Hong Kong should leverage the country’s backing to develop a diversified economy 

As a small and fully open economy, Hong Kong has been vulnerable to the complicated and volatile international political and economic environment. “The uncertainties in the global economic outlook and geopolitical turmoil have undermined Hong Kong’s export performance. At the same time, the rapid development of innovation and technology has brought unprecedented security risks,” Chan told the forum. 

READ MORE: Experts welcome nation's financial-opening pledge

Chan said Hong Kong’s banking system is safe and stable, while authorities need to take safety considerations into account and put in place an appropriate regulatory framework for the financial technology sector given its high risks.

On a positive note, he expressed confidence in Hong Kong’s capital market, adding that emphasis is being placed on expanding more sources of funding, such as the Middle East market. 

Last month, Asia's first exchange-traded fund (ETF) that tracks Saudi Arabian equities made its debut on the Hong Kong Stock Exchange. Through the ETF, investors in Hong Kong are able to trade Saudi stocks including Saudi Aramco and Saudi National Bank, in Hong Kong dollars or Chinese yuan.

Echoing Chan’s remarks, Hang Lung Properties’ Chairman Ronnie Chan Chi-chung said financial security has become an important consideration of the national defense due to the tensions between China and the US. 

The property tycoon added that deglobalization is already underway and Hong Kong should leverage the country’s backing to develop a diversified economy. 

Song Xiaofeng, editor-in-chief of the Beijing-based think tank Taihe Institute, said Hong Kong should seek new growth momentum in the emerging trends of environmental, social, and governance (ESG). 

“The demand for ESG reporting by listed companies in Hong Kong is rising, and companies are paying more attention to ESG issues. Investors are also more inclined to assess some of the risks and opportunities faced by the relevant companies from an ESG perspective,” Song said. 

READ MORE: Fintech key to transforming HK’s financial services industry

He suggested Hong Kong cooperate with the central government to build the country's own ESG rating system and promote the development of an ESG-linked offshore renminbi investment and financing market.