Hong Kong’s Capital Market: A Key Player in the City’s Financial System
Hong Kong’s capital market plays a vital role in the city’s financial system and national strategies, but it still lags behind in several areas. According to Qi Bin, deputy at the central government’s liaison office in Hong Kong, the city’s market regulation, transaction costs, and corporate governance need significant improvement.
Benchmarking Against Global Standards
Qi suggests that Hong Kong should research and develop a capital market white paper, proposing improvements that meet the highest global standards. This white paper could solicit input from all stakeholders, including global institutions, to boost investor confidence and elevate Hong Kong’s capital market to the level of top financial centers like New York and London.
A Strategic Role in Economic Growth
The capital market is crucial for Hong Kong’s economic growth, particularly in areas such as artificial intelligence and the Greater Bay Area’s development. Qi emphasizes that revitalizing Hong Kong’s economy hinges on finance, and strengthening the financial sector relies heavily on the capital market.
A Bright Spot in Hong Kong’s Economy
Despite challenges, Hong Kong’s capital market performed remarkably well last year, with the initial public offering (IPO) market regaining its vitality. Finance Secretary Paul Chan notes that there are around 100 companies in Hong Kong’s IPO queue, and with more quality issuers and central authorities’ support, the liquidity of the stock market is expected to improve.
Room for Improvement
While Hong Kong’s financial market shows positive signs, there is still room for improvement in many aspects. Qi warns that the foundation for continuous improvement remains fragile, and investor confidence needs further strengthening. To build the city into an international financial centre, Hong Kong needs to promote more high-quality mainland and international enterprises to list in the city and optimize the financial regulatory coordination mechanism between the mainland and Hong Kong.
Strengthening Capital Market Regulation
Qi stresses the importance of strengthening capital market regulation to prevent financial risks. He also proposes advancing the development of a Hong Kong capital market white paper to elevate the level of Hong Kong’s capital market and build a world-class market.
Global Industry Cooperation Summit
To establish Hong Kong as a hub for global collaboration, Qi suggests hosting a global industry cooperation summit. This would foster more in-depth exchanges between authorities and stakeholders within the value chain to map out strategies for Hong Kong’s capital markets.
A World-Class Market
Industry experts, such as Sally Wong, CEO of Hong Kong Investment Funds Association, agree that a capital market white paper can facilitate more in-depth exchanges between authorities and stakeholders to elevate Hong Kong’s capital market to a world-class level.
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