By Dr. Kevin Lau
Hong Kong is one of the world's financial centers, and the financial industry is the backbone of our economy. However, in this highly competitive environment, no position is unshakable. It is essential for us to continuously optimize our financial infrastructure and conditions, seize the opportunities at hand, and consolidate and further enhance Hong Kong's status as a financial center.
Accurate analysis of the problem is crucial. Hong Kong's accumulated experience in finance, robust and internationally aligned regulations, abundant talent, and capital are our assets. Another significant advantage that should not be overlooked is our geographical location. Since the resumption of cross-border travel with the mainland, the flow of people and goods has significantly increased. The external environment is complex, ever-changing, and undergoing unprecedented transformations. Rather than taking risks externally, it is better to embrace the role of a "super-connector" between the mainland and the international community, actively responding to the mainland's continuous internationalization needs. This is the best strategy to further enhance Hong Kong's position as an international financial center.
In fact, being a "super-connector" is not a new concept. Looking back, Hong Kong became a global financial center by fully capitalizing on the historic opportunity of China's economic reform and opening up. Since the reform and opening up, Hong Kong has been the primary channel for mainland enterprises to "go global" Chinese state-owned enterprises have been listed in Hong Kong for 30 years. Currently, H-shares account for 12% of the Hong Kong stock market. If we consider H-shares, red chips, and private enterprises together, mainland enterprises account for a market capitalization of 76.5% and a trading volume of 87.4% in the Hong Kong stock market. Hong Kong not only meets the financing needs of mainland enterprises in the international capital market but also optimizes these enterprises in terms of corporate management and alignment with international standards, thereby enhancing their competitiveness.
After the pandemic, these fundamental conditions have not changed. The country still places great importance on Hong Kong's highly digitized economic system, sound regulatory mechanisms, abundant business opportunities, funds, and talent as an international financial center. This has been clearly stated in the published "Outline of the 14th Five-Year Plan" and the "Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area." Therefore, if we play the role of a "super-connector" effectively, Hong Kong will undoubtedly become the preferred destination for many international financial enterprises planning to enter the mainland market.
The author is a specialist in radiology, with a master degree of Public Health from the University of Hong Kong, and an adviser of Our Hong Kong Foundation.
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