HK urges co-op with Beijing on private capital

Beijing and Hong Kong are holding discussion on the mutual recognition of retail funds in both cities.

That arrangement will make it easier for mutual fund managers to raise capital in the mainland market. It would also further encourage the development of Hong Kong as an international asset management center and a major gateway to global markets for investors from the mainland.

The financial sector has become a core industry in Beijing.

"Beijing's financial industry including its equity, bond and currency markets have expanded significantly in the past few years," said Wang Hong, director of the Beijing Municipal Bureau of Financial Work.

"The closer link with Hong Kong as a financial hub can create a win-win scenario that would allow both cities to provide benefits for financial industry players."

Last year, Beijing's financial sector generated 259.25 billion yuan ($43 billion) in added value, up 14.4 percent on a year-on-year basis, accounting for 14.6 percent of Beijing's GDP, according to data from the city government.

The contribution of the financial industry to economic growth in the capital reached 24.7 percent, ranking first among all industries.

As of the end of 2012, the balance of yuan-denominated loans (excluding discounted bills) to the culture and high-tech industries increased by 20.6 percent and 35.8 percent year-on-year, respectively.

As of the same date, loans to small and medium-sized enterprises were up by 7.5 percent. That growth rate was 5.7 percentage points higher than the increase for large companies, city government data show.