Hong Kong officials on Tuesday said the city remains a resilient and vibrant financial center after its financial sector logged sustainable growth and is poised to reap the benefits of closer mainland and international ties.
Speaking at the three-day HSBC Global Investment Summit, Hong Kong Monetary Authority Chief Executive Eddie Yue Wai-man said the city’s deposits have recorded annual growth over the past five years, with a cumulative increase of 21 percent.
Additionally, from 2019 to 2022, assets under management in Hong Kong rose by 20 percent.
In response to criticism that Hong Kong’s role as an international financial center is diminishing or that capital is leaving, Yue said data reflects the opposite.
Yue said some areas in mutual market access programs between Hong Kong and the Chinese mainland, such as the southbound investment channel, were still in their infancy, and have room for further development in terms of eligibility requirements and quotas.
He said there are also vast opportunities for Hong Kong in the renminbi business as he had observed a growing interest in utilizing renminbi for transaction settlements during his visits to the Middle East and ASEAN countries.
Yue added that Hong Kong’s financial system has remained stable despite challenges such as social events, the COVID-19 pandemic, and financial turbulence in Europe and the United States in recent years.
Attending the summit on Tuesday, Julia Leung Fung-yee, chief executive officer of the Securities and Futures Commission of Hong Kong, undertook to enhance the city’s market competitiveness, particularly in terms of stock market efficiency and liquidity.
She emphasized the importance of reducing trading costs with medium- and long-term measures including narrowing bid-ask spreads and improving the pricing process for initial public offerings.
While Hong Kong faces ongoing challenges, Leung said the city boasts a world-class regulatory system, a strong talent pool, and a robust legal framework, which can help its market navigate difficulties and rebound.
She cited the 93 percent year-on-year growth in net inflows to Hong Kong dollar-denominated investment funds last year and the mid-single-digit growth in assets under management, saying Hong Kong remains a resilient and vibrant financial center.
During a meeting with the Chairman of the China Securities Regulatory Commission last month, they discussed expanding mutual market access mechanisms, including Stock Connect.
She acknowledged that there is still much work to be done in the short term to establish new networks and strengthen existing connections for Hong Kong as an international financial center.
Contact the writer at evanliu@chinadailyhk.com
