Hong Kong is among the top financial centers in the world and has become a hub of global diversity offering comprehensive financial services, said Laurence Li, the chairman of Hong Kong's Financial Services Development Council (FSDC).
Li shared insights on how Hong Kong can better strengthen its position as a global financial center on the sidelines of the 2024 Financial Street Forum, which highlighted financial openness and cooperation.
He stressed that Hong Kong has become China's financial gateway to the world, connecting with business counterparts from different parts of the globe.
"I think the point about international financial center is that it shouldn't be tied to just one-way or two-way traffic. It should be a hub for everything. It's like a hub and spoke. You want to be the center, not just of two things. You want to be center of many things. That's what make an international financial center really interesting. One of the things that I wish Hong Kong to become and it is very much on way to becoming is when you go out to the street, you see people from Europe, you see people from Africa, you see people from Middle East. When you are thinking about lunches and dinner, you have food from everywhere. That's what really makes an international financial center interesting. It also gives it a critical mass of its own. That when people want to do their financial business, do their financial services, do their investing. They want to go to a place that offers not just one product very well. They want to go to a place that offers a whole range of products that they can come here, they can trade in Renminbi, they can trade in the U.S. dollars, they can trade in Ringgit, they can trade in Baht. That's what makes a place really attractive," said Li.
The FSDC has been forming close partnerships with counterparts in the Middle East and ASEAN countries, including signing MoUs with Qatar and Saudi Arabia. Li noted that Hong Kong has been playing a pivotal role in global collaboration in financial market reform, regulation and talent development.
"We at the FSDC are quite proud that we are the first institution in Hong Kong to have an official MoU with a government agency of Saudi Arabia. It actually came about not from our making. We do a lot of research on how to reform, how to improve financial markets and financial regulation. And our Saudi friends noticed that that is what we do and they reached out to us and asked if we would be interested in working with them. We worked with them for about six months, nine months or so. Then the idea of an MoU came up quite naturally. We are of course not a for-profit organization. We don't sign MoUs to do mutual investments. But what we do is we sign MoUs so that we understand each other better. And we understand we work together on mutual investment regimes, we work together on talent development. We work together on how to improve our regulation, how to improve market access. We have actually really taken on MoUs," he said.
Li pointed out that Hong Kong has successfully leveraged the Chinese mainland's economic growth, fostering RMB internationalization.
"Hong Kong is already an international financial center. It is a super connector. I'm confident that it is actually going to rise yet again to the next level. Hong Kong is currently ranked No.3 in terms of international financial centers behind London and New York. But if you actually look at it historically, 30 years ago, Hong Kong was not even in the top of the league table. What has happened? What took us to the top of the league table is the rise of the Chinese mainland and Chinese economy. Hong Kong has served well, to use the word that you mentioned earlier, as a gateway into China (Chinese mainland) and out of China. We are taking that gateway advantage and becoming a super connector. We are doing African business, we're doing Middle Eastern business, we're doing Asian business, ASEAN business. We are also increasingly doing South American business. This confluence of all the flow is going to make Hong Kong truly international and global. There's another very big element to this-- the internationalization of Renminbi. The mainland Chinese economy is already in absolute terms 80 percent the size of the U.S. economy in PPP terms, perhaps even bigger. Renminbi is poised to be a big trade currency, is poised to increase its wages in investment currency. Finance, we often think in terms of stocks, asset management, so on and so forth. But deep down, finance is also about the economy. And the thing most high with the economy is the currency. And with the continuing internationalization of Renminbi, Hong Kong is going to be propelled to be on par with London and New York," he explained.
Themed "Trust and Confidence -- Work Together to Promote Financial Openness, Cooperate for Shared Economic Stability and Growth," the three-day Financial Street Forum held from Friday to Sunday in Beijing was attended by over 500 representatives from 30 countries and regions around the world. Sessions under the forum continued into Tuesday in the HKSAR, Luxembourg and Tokyo parallel with main events in Beijing.
Hong Kong hub for global diversity, comprehensive financial services: FSDC chairman
