HKSAR vows to beef up competitive advantages

The Hong Kong Special Administrative Region's competitiveness as a global asset and wealth management center will be strengthened, officials from the mainland and Hong Kong vowed on Monday.

In his opening remarks at the 18th Asian Financial Forum, Hong Kong Chief Executive John Lee Ka-chiu said the HKSAR government has exempted stamp duty on the transfer of shares and units of real estate investment trusts, and has boosted the profit tax exemption regimes for funds and single family offices.

"We are also expanding our mutual access programs with the mainland's financial markets, such as enhancing southbound trading under the Bond Connect that would allow greater participation by mainland nonbanking financial institutions like securities firms and insurance companies," he said.

Hong Kong managed about $4 trillion worth of assets in 2023, with net fund inflows up well over three times. The city is also home to 2,700 single family offices, with more than half of these set up by ultra high net-worth individuals, each with a net worth of at least $50 million.

The forum, themed "Powering the Next Growth Engine", has attracted some 3,600 business and financial leaders from more than 50 countries and regions.

At the opening session, Pan Gongsheng, governor of the People's Bank of China, said that the central bank will focus on four key areas and continue to fully support the development of Hong Kong as an international financial center.

These measures include significantly increasing the national foreign exchange reserves' asset allocation proportion in Hong Kong, further optimizing the Cross-boundary Wealth Management Connect program and Qualified Domestic Institutional Investors system, and implementing the optimized arrangement of Mutual Recognition of Funds so as to attract more mainland and international fund flows into Hong Kong.

The finance ministers of several countries said they will leverage Hong Kong's bond market and initial public offering market to access market funds.

In the plenary session of the 18th AFF, Pakistan's Federal Minister of Finance and Revenue Muhammad Aurangzeb said the Pakistan government intends to issue euro-denominated bonds in Hong Kong, and that Pakistani companies are interested in listing in Hong Kong to raise funds.

The minister added that Pakistan's Belt and Road infrastructure project with the mainland is currently in the second phase, and the country has a favorable location and could become a corridor for the Middle East and Central Asia.

Luxembourg's Minister of Finance Gilles Roth said that the country has strong ties with the Chinese mainland, with many mainland banks setting up their presence there, involving insurance and reinsurance businesses and that it also has a long-standing relationship with the Hong Kong SAR.

"There are about 2,000 green bonds listed in Luxembourg. If they can be cross-listed in Hong Kong, it can strengthen the relationship between Luxembourg and Hong Kong, and connect the European and Asian markets," Roth said.

Liu Zhenmin, the nation's special envoy on climate change, said Hong Kong can leverage its advantages to empower Asia's energy transformation through climate finance, and make greater contributions to the continent's energy transformation.