Hong Kong’s position as an international financial hub continues to strengthen despite shifting geopolitical headwinds, with the city’s initial public offering market retaining the top global ranking this year, and new growth drivers emerging from financial innovation and cross-market collaboration, Financial Secretary Paul Chan Mo-po said on Sunday.

Writing in his weekly blog, Chan said with a growing number of firms using the special administrative region’s capital-raising platform for international expansion, funds raised through IPOs had exceeded HK$140 billion ($17.9 billion) as of Saturday.

The average daily turnover on the Hong Kong stock exchange has surpassed HK$280 billion since March.

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Hong Kong Exchanges and Clearing, which runs the city’s bourse, may add Malaysia’s Bursa Malaysia to its list of recognized stock exchanges, with the aim of expanding Islamic finance and broadening sources of capital and new listings, after signing mutual recognition agreements with 20 exchanges worldwide.

“As a leading world financial center in the Asia Pacific, Hong Kong will continue to leverage its role as a ‘super connector’ to facilitate efficient capital flows and link investors with opportunities in the region,” Chan said.

As global institutional investors are increasingly seeking diversified, long-term growth opportunities, Asia is demonstrating strong momentum with the rise of frontier companies and projects in areas like green energy, advanced manufacturing and digital finance, he said.

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Between 2014 and 2024, global investment flows into Asia had doubled to about $6 trillion, while the region’s capital markets have quadrupled in size since 2000 to exceed $34 trillion by the end of 2024, according to the finance chief.

Besides equities, the SAR is stepping up efforts to build an international gold trading market to broaden its financial offerings as “global investors diversify asset allocation and lessen dependence on single markets or asset classes amid rapid technological change and geopolitical uncertainty”, he said.

Hong Kong’s largest local physical-gold exchange-traded fund began trading on Tuesday which, Chan said, will support the development of a complete gold industry and value chain in the city.

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The range of underlying assets for ETFs is expanding in Hong Kong, covering spot and futures precious metals, technology companies, semiconductor firms and digital assets. These thematic and leveraged products provide investors with efficient and transparent investment tools.

ETFs also help to facilitate cross-border cooperation. The Hong Kong stock exchange has launched a co-branded index with Bursa Malaysia, HKEX Bursa Malaysia Large Cap Index, tracking the 60 largest listed companies across the two markets, and has authorized asset managers to issue related ETFs to further expand cross-market investment products, Chan said.

Hong Kong had earlier introduced ETF cross-listings with Saudi Arabia and joint index products with South Korea.

The city’s exchange-traded product market is now the third-largest globally by size, after the United States and the Chinese mainland, with average daily trading reaching HK$38.6 billion in February this year.

These products track assets across major global markets, including the US, Europe and the Middle East, giving investors broader portfolio options and supporting liquidity, particularly during market volatility, Chan said.

Contact the writer at irisli@chinadailyhk.com