Hong Kong’s economic outlook this year is “cautiously optimistic”, Financial Secretary Paul Chan Mo-po said on Thursday, as the city continues to draw support from firm local momentum and a steadily advancing Chinese mainland economy, even as intensifying external challenges threaten to amplify swings in financial markets.

Speaking at the CGCC Forum 2026, an annual event organized by the Chinese General Chamber of Commerce, Hong Kong, Chan warned that a more complex geopolitical environment and highly unpredictable financial and trade policies in some major economies could “trigger sudden shifts in capital flows, heighten financial market volatility and ultimately spill over into the real economy”.

At the same time, Chan said Hong Kong will benefit from the mainland’s steady economic expansion and strong fundamentals, adding that expectations of further United States rate cuts, even if modest, could support market sentiment.

In this context, “the city’s consumption and investment activities are expected to gain traction”, supporting its economy to maintain steady progress over the course of the year, the finance chief noted.

The Hong Kong Special Administrative Region government late last year raised its forecast for economic growth in 2025 to 3.2 percent from a previous range of 2 to 3 percent, marking an acceleration from the 2.5 percent expansion recorded in 2024 and a third consecutive year of positive growth after the COVID-19 pandemic.

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Under the theme “Charting the Course: Hong Kong’s Economic Outlook 2026 in the 15th Five-Year Plan Era”, Chan’s speech echoes the Recommendations of the Central Committee of the Communist Party of China for Formulating the 15th Five-Year Plan for National Economic and Social Development, adopted at the fourth plenary session of the 20th CPC Central Committee in late October.

Covering the period from 2026 to 2030, the document calls for efforts to “consolidate and enhance Hong Kong’s status as an international financial, shipping and trade center”, and to “support it in developing into an international innovation and technology center”. It also pledges to “support Hong Kong in better integrating into and contributing to the country’s overall development”.

In the coming phase, Chan said Hong Kong should cultivate emerging industries and new sources of growth, while continuing to consolidate its traditional strengths and markets.

Financially, he said building on Hong Kong’s position as the world’s largest initial public offering fundraising hub last year, the city will explore ways to “further optimize its listing rules, market structure and trading mechanisms”. He added that the HKSAR government will push for more diversified development of the financial sector, including by advancing wealth management, green finance and offshore renminbi business.

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As for the trade sector, the city should align with the trend of mainland companies expanding globally, and develop itself into a hub for multinational industrial supply-chain management and trade financing, so as to provide these firms with professional services such as treasury management and compliance advisory support.

CGCC Chairman Jonathan Choi Koon-shum said the recommendations for formulating the 15th Five-Year Plan demonstrate Hong Kong’s role as a bridge between the mainland and the rest of the world.

He said the business community should step up efforts to enhance the competitiveness of Hong Kong’s modern services sector, and build cross-border capital and investment platforms to offer comprehensive support for mainland companies expanding overseas in an “effective, orderly and secure” manner.

Contact the writer at irisli@chinadailyhk.com