Official data show that, as of August, 59 companies had gone public in Hong Kong this year, raising HK$134.5 billion ($17.26 billion) through initial public offerings — the highest figure since 2021. In parallel with the IPO upsurge is the strong performance of the Hong Kong stock market, with the benchmark Hang Seng Index having risen 27 percent this year as of Sept 1, despite the negative impact of the tariff war launched by the United States in April.

The Half-yearly Economic Report 2025, released recently by the Census and Statistics Department of the Hong Kong Special Administrative Region government, indicated that the city’s real GDP grew by 3.1 percent year-on-year in the second quarter, slightly higher than the 3 percent recorded in the first quarter. This marks the 10th consecutive quarter of year-on-year growth.

In the first half of 2025, the market capitalization of the Hong Kong stock market rose to HK$42.7 trillion, up 33 percent year-on-year. As of the end of March, the number of registered funds in Hong Kong reached 976, with a net capital inflow exceeding $44 billion — a 285 percent increase year-on-year. By end-April, total bank deposits surpassed HK$18 trillion, up 19 percent compared with the end of June 2022. In the first quarter, new insurance premiums totaled HK$93.4 billion, marking a 43.4 percent increase from the first quarter of 2024.

The impressive performance of the city’s financial sector and the overall economy has surprised many. Clearly, the previously hyped theory of Hong Kong becoming “a relic of an international financial center” or “an international financial center in decline” has been busted.

The strong recovery of the financial sector can be understood from two perspectives:

Externally, the anti-globalization efforts of the US — particularly the repeated threats by US officials to     delist Chinese enterprises from American stock exchanges — has sounded an alarm for companies from China as well as from other places across the globe: New York is no longer the default choice for global fundraising. Hong Kong’s appeal as an international financial center is becoming increasingly prominent against this backdrop.

Internally, Hong Kong has remained focused on enhancing its financial ecosystem. Initiatives such as the launch of cross-boundary payment systems and the seamless integration of the city’s fast-payment infrastructure with that of the Chinese mainland have strengthened connectivity. The city has also made strides in developing green finance, with the aim of becoming Asia’s premier green finance center, and launched Policy Statement 2.0 on the Development of Digital Assets in Hong Kong, which sets out a policy framework for positioning Hong Kong as a global innovation hub in the digital asset sphere.

Hong Kong is uniquely positioned to develop producer services. Compared with mainland cities, it enjoys the institutional advantages of a free port and a common law jurisdiction. Its high degree of marketization, robust rule of law, and high-level internationalization, along with its mature professional service ecosystem, all stand out

The prowess of Hong Kong’s financial sector underscores the city’s increasingly pivotal role in economic globalization. The city serves not only as a safe harbor for international capital but also as a driver of growth and profit.

Hong Kong’s institutional framework is closely aligned with international standards, providing a vital platform for corporate fundraising and global expansion. Contrary to the claim that Hong Kong has become “just another mainland city”, it remains highly internationalized, and its appeal to global capital continues to grow.

Meanwhile, signs of recovery have emerged in the city’s consumer market, as spending activity gradually rebounds across various sectors. This summer holiday has seen a remarkable surge in inbound tourism from the Chinese mainland. Crowds have returned to border checkpoints, popular tourist sites, city centers, concerts and soccer events.

According to the Half-yearly Economic Report 2025, the number of visitor arrivals in the first half reached approximately 24 million — up 12 percent compared with the same period last year. Meanwhile, private-consumption expenditures grew by 1.9 percent year-on-year in real terms and by 3.4 percent quarter-on-quarter, reversing a downward trend that had persisted through the previous four quarters.

The HKSAR government has actively promoted the model of “boosting tourism with cultural activities and promoting culture through tourism”. The commissioning of the Kai Tak Sports Park has further enhanced the city’s capacity to host large-scale cultural and sports events. The integrated development of culture and tourism has generated a positive spillover effect across the retail, catering, hospitality and transport sectors.

Another encouraging sign is the rebound in the property market. In the second quarter, the number of residential property transactions reached 16,574 — a 37 percent increase quarter-on-quarter. Home prices rose by 1 percent during the quarter, ending a two-quarter decline.

These improvements in the real estate market are attributable in large part to supportive policies. In February 2024, the HKSAR government scrapped all restrictive measures and removed the multiple stamp duties previously imposed on residential property transactions, including the Special Stamp Duty, the Buyer’s Stamp Duty, and the New Residential Stamp Duty, thus significantly lowering the upfront costs for homebuyers. The city’s talent-admission programs have also boosted housing demand. As of mid-2025, 330,000 applications had been approved under various talent programs, with approximately 220,000 individuals having arrived in Hong Kong. Buyers from this group of new residents have become a major driving force behind the property market’s upward trend.

The Half-yearly Economic Report 2025 also revealed that Hong Kong’s services exports continued to gain momentum, expanding by 7.5 percent year-on-year in the second quarter, up from 6.3 percent in the first quarter. This indicates a robust upward trend in the city’s service sector.

The prospect for Hong Kong’s professional services is bright, given that the Chinese mainland’s expanding economic scale demands ample producer services. As the world’s second-largest economy as well as the largest industrial manufacturer and goods trader, China contributes approximately 30 percent of global economic growth, and is a major trading partner of over 150 countries and regions worldwide. An economy of this magnitude relies heavily on the support of producer services. The country must rely more on its own service capabilities to mitigate external dependencies and associated risks as geopolitical challenges grow. This context presents a good opportunity for Hong Kong.

Hong Kong is uniquely positioned to develop producer services. Compared with mainland cities, it enjoys the institutional advantages of a free port and a common law jurisdiction. Its high degree of marketization, robust rule of law, and high-level internationalization, along with its mature professional service ecosystem, all stand out. Compared with overseas cities, the HKSAR is the ideal gateway for foreign capital entering the mainland market, offering a full range of professional services for multinational corporations that are difficult to replicate elsewhere.

Strengthening the producer-services sector is key to enhancing Hong Kong’s international profile and revitalizing the local economy. The HKSAR government and relevant sectors should continue to intensify their efforts in this regard.

The author is vice-chairman of the Committee on Liaison with Hong Kong, Macao, Taiwan and Overseas Chinese of the National Committee of the Chinese People’s Political Consultative Conference, and chairman of the Hong Kong New Era Development Thinktank.

The views do not necessarily reflect those of China Daily.