The head of Hong Kong’s securities watchdog has brushed aside US President Donald Trump’s painting a bleak picture of the city’s financial market performance on the world stage following the United States’ decision to strip the special administrative region of its special economic status.
Hong Kong’s full-fledged standing as an international financial center is here to stay and will buck the global economy’s downward trend with the Chinese mainland’s resolute support and the SAR’s long-standing competitive edge, said Tim Lui Tim-leung, chairman of the Securities and Futures Commission.
Hong Kong’s full-fledged standing as an international financial center is here to stay and will buck the global economy’s downward trend with the Chinese mainland’s resolute support and the SAR’s long-standing competitive edge, said Tim Lui Tim-leung
Trump had said on Wednesday Hong Kong will “no longer be a successful exchange” after losing its special economic status, but Lui said he disagreed with that doomsday talk.
“People should have confidence in Hong Kong’s stock market. If we look at our stock exchange and our clearing house, they’ve all been functioning very well even during the most turbulent time recently,” he said.
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Lui said Hong Kong’s reputation as a global financial hub is built on years of hard work and contributions from various sectors. With all the criteria to remain as a “full-fledged” international financial center, the city’s time-honored competitive edge in the business sector will not be gone overnight.
Apart from Hong Kong’s well-established legal system, it has a solid infrastructure, a sound banking system, free flow of capital, low tax rates, and a highly regarded regulatory regime, he explained.
The SFC chief said he is confident about Hong Kong’s future prospects with the influx of capital from the Chinese mainland, as well as Western countries.
In June, mainland tech behemoths, Nasdaq-listed JD and NetEase, raised a total of US$6.6 billion through secondary listings on the Hong Kong Stock Exchange amid growing US hostility against Chinese enterprises.
According to a June report by accountancy firm Ernst & Young, initial public offerings in Hong Kong saw a 21 percent increase in total capital raised in the first six months of this year, with JD and NetEase accounting for 62 percent of the amount.
In 2019 Hong Kong took the crown as the world’s top IPO destination for the second consecutive year with HK$313 billion (US$40.4 billion) raised, the highest since 2010. The city held the title six times over the past decade.
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Lui said Hong Kong has always served as a bridge between the mainland and the world. “With more companies coming to our stock exchange for a listing, I think our future prospects will be very good indeed.”
He’s optimistic that with the central government’s unwavering backing, the local economy will continue to thrive post-COVID-19.
“Over the years, a host of measures have been rolled out to support Hong Kong,” Lui pointed out. And, in view of the coronavirus pandemic and the economic downturn, he is certain the central government will be mulling ways and means to help Hong Kong people through further supportive policies, as has always been the case.
To help contain the pandemic, the central government has dispatched two medical teams to the SAR — one specializing in boosting virus-testing capacity and the other in helping to design, build and manage temporary treatment facilities.
Lui said the mainland experts’ assistance is of paramount importance to Hong Kong as the outbreak has battered the local economy, and seriously affected the livelihood of residents.
Therefore, it is critical that Hong Kong brings the outbreak under control as soon as possible to revive the economy and get people’s lives back to normal, he said.
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