Hong Kong is Asia Pacific's leading international financial centre (IFC), attracting 70% of the world's largest banks and supporting a stock market that is the world's 7th largest and 3rd most capitalised in Asia.
Advantages include Hong Kong's common law legal system underpinned by an independent judiciary and zero tolerance of corruption, freely convertible currency, low and simple tax system, free flow of information, liberal immigration policies and a deep and broad pool of financial talent.
Hong Kong is also China's IFC and largest source of foreign capital for mainland China companies. Hong Kong raised nearly US$8.5 billion in IPOs last year, ranking 2nd in Asia and 5th in the world in terms of total funds raised.Hong Kong is the only economy outside the Mainland to have Renminbi banking services and a Renminbi bond market.
The Central Government recently announced new measures to consolidate Hong Kong's position as an international financial centre.
Measures include allowing currency swap arrangements between the People's Bank of China and the Hong Kong Monetary Authority, plus supporting the listing of Mainland firms in Hong Kong. It is also rolling out a pilot scheme to expand Renminbi settlement for international trade between Guangdong province and the Yangtze River Delta and Hong Kong and Macau. This will provide more certainty for companies in settling trade by reducing the risk of exchange-rate fluctuations.
The Hong Kong Government is committed to further enhancing the financial services sector in Hong Kong. It will build a platform conducive to growing Islamic finance in Hong Kong and implement a programme to issue Government bonds, ensuring the strength of financial services, a key economic pillar that last year contributed nearly one fifth of Hong Kong's GDP and employs around 200,000 people.
Alison Collingridge is head of marketing and communications at InvestHK.
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