Hong Kong is becoming global capital’s trusted steward, with the net inflow to funds domiciled in the city surging by nearly HK$100 billion ($12.75 billion) in the first quarter of the year, Financial Secretary Paul Chan Mo-po said on Monday.

Speaking at the Hong Kong Investment Funds Association (HKIFA) 19th Annual Conference, Chan said flows are converging in the financial hub as many institutions recognized that their allocation to the region has long been low, while Chinese mainland tech firms are accelerating their integration into global market supply chains, generating substantial demand for international capital.  

“Global capital allocation is undergoing a fundamental realignment, and this hub is where the flows are converging,” Chan said.

He said the net fund inflows to Hong Kong-domiciled funds reached some HK$350 billion in 2025, and the momentum “has carried into the first quarter of this year, with nearly HK$100 billion more.”

“These numbers reflect something important. Hong Kong is no longer simply a marketplace for global capital to pass through. We are becoming their trusted steward,” Chan said.

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He said the convergence is also due to the institutional foundations Hong Kong built over the decades - its common law system, an internationally respected regulatory framework, and professional market intermediaries - plus the steadfast support of the central authorities.

Chan said global investors are expected to further increase their allocations in the special administrative region, which offers a reliable and efficient financial infrastructure while deepening connectivity with other exchanges and jurisdictions.  

“Over the past two years, the number of exchange-traded products (ETPs) listed in Hong Kong has grown from fewer than 180 to more than 240, with assets under management approaching HK$650 billion, placing us firmly among the world's top three ETF markets,” Chan said.

“Several of these products even rank as the largest of their kind globally. This is not merely numerical growth; it means global investors can now allocate to gold, technology, cross-border indices, and even digital assets through Hong Kong, at a lower risk premium,” he added.

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Chan said the city's unique international connectivity and familiarity with the developments on the mainland is most powerfully manifested in the Guangdong-Hong Kong-Macao Greater Bay Area, which combines frontier research, advanced manufacturing, and an international capital market.

“Such a combination is uncommon anywhere in the world. Hong Kong's role is to serve as the professional intermediary between this ecosystem and global capital,” Chan said.

“And our role is not just a platform for them to raise funds for their global expansion, but also to help them align their corporate governance with international standards and best practices, gain greater recognition from investors and enhance their global visibility,” he added.