Speech by FS at Deutsche Bank Emerging Markets Family Office Forum in Hong Kong 2025
Alexander (Chief Executive Officer Asia-Pacific, Europe, Middle East and Africa, and Germany of Deutsche Bank, Mr Alexander von zur Mühlen), Marco (Head of Emerging Markets of Deutsche Bank Private Bank, Mr Marco), Salman (Vice Chairman of Deutsche Bank Private Bank, Mr Salman Mahdi), distinguished guests, ladies and gentlemen,
Good morning.
It is a great pleasure to join you all at this year’s Deutsche Bank Emerging Markets Family Office Forum. My sincere thanks to Deutsche Bank for bringing to Hong Kong such a distinguished group of family principals, next-generation leaders and senior decision-makers from across the globe.
Stability, for family offices
While the focus today is on family offices, it would be remiss of me not to address a broader issue: that is, the so-called "reciprocal tariffs" imposed by the US (United States) on its trading partners. And why it further illustrates that Hong Kong is the right destination for family offices.
Much has been said about the flip-flopping of the Trump Administration and the prospects of the tariff war. For family offices, this uncertainty and unpredictability have added new complexities to their asset allocation strategies.
Currently, across the world, sovereign governments and investors are seeking to de-risk their allocations and expand their portfolios to markets that provide policy clarity, consistency and credibility. The same holds true for family offices looking to preserve and grow their wealth in a secure and predictable environment.
In this context, Hong Kong stands out as a robust destination of choice. Allow me to share a few observations.
First, our stock market. With a capitalisation of nearly US$5 trillion, it is deep and liquid, and has demonstrated remarkable resilience. Following the tariff announcements, the Hang Seng Index saw a sharp fall on Monday last week. But the market has since been regaining ground. Trading volumes have been high, indicating the strong underlying liquidity. Over the past week, the average daily turnover of our stock market was about HK$360 billion, about 2.8 times of that in 2024. That speaks volumes about investors’ interest and confidence in our market.
In fact, over the past few years, the Government, along with our financial regulators, have put in place a round-the-clock, cross-market surveillance system to detect and address potential threats associated with market volatility. We focus on whether the markets are functioning in an orderly manner, and whether there are irregularities or systemic risks that will threaten Hong Kong’s financial stability. So far, there has been no cause for concern.
Second, the Hong Kong dollar remains firm, trading on the strong side of its convertibility range, which indicates that there is no capital flight. Indeed, our bank deposits have been on a rising trend over the past year. In February, we had over US$2.2 trillion in bank deposits, rising by some 10 per cent compared to a year ago. Our Linked Exchange Rate System continues to function smoothly, underscoring the strength and stability of our monetary system.
Beyond financial security and stability, Hong Kong offers compelling reasons for family offices to anchor their operations and allocate their assets here.
First, it is the "one country, two systems" principle which provides the foundation for long-term prosperity and reinforces the IFC (international financial centre) status of Hong Kong. President Xi Jinping has reaffirmed on multiple occasions that the “one country, two systems” arrangement will remain in place in Hong Kong in the long run. Hong Kong’s unique position as a gateway between the Mainland and the world is highly cherished by the Central Authorities.
In essence, Hong Kong will continue to uphold the defining features that set us apart from the rest of China: a free port; free trade policy; free flow of capital, goods, people and information; and a freely convertible currency. We remain open, diverse, cosmopolitan and committed to welcoming capital, business and talent from around the world. This is deep in our DNA.
A crucial element of the "one country, two systems" principle is the common law system underpinned by an independent judiciary. Despite misconceptions about our city, the facts are convincing: in the World Justice Project’s Rule of Law Index, Hong Kong ranks ahead of the US and many European countries.
According to a recent survey by the American Chamber of Commerce in Hong Kong released in January this year, 83 per cent of its members expressed confidence in our rule of law. The figure has registered a consistent rise over the past two years.
Our simple, low-tax regime is another strong advantage. We impose no capital gains tax, no estate tax and no tax on dividends, offering a highly enviable environment for wealth preservation and growth.
Our international competitiveness is evident by various global rankings. We are the world’s freest economy, Asia’s top financial centre, and the fifth-most competitive economy globally.
Here in Hong Kong, your capital is safe. Protection of capital and private property is enshrined in our Basic Law. We honour our international obligations and have never implemented any sanctions unilaterally imposed by other jurisdictions.
Opportunities for investments and businesses
Ladies and gentlemen, beyond the above institutional fundamentals, Hong Kong is a city of immense opportunities. Let me highlight three points.
First, beyond the stock market that I mentioned earlier, we offer a full range of options for you to deploy your capital. Our venture capital and private equity sector manages over US$230 billion, which is second only to the Mainland. We are Asia’s No. 1 hedge fund base. Our asset and wealth management sector oversees close to US$4 trillion of assets, with over half of them sourced internationally.
Second, innovation and technology is powering Hong Kong’s next chapter. We are investing heavily to develop AI and other frontier technologies as new pillars of our economy. Our strategy encompasses building infrastructure, providing funding support, attracting strategic enterprises and talent, and engaging in international exchanges. Now, "AI+" is the name of the game, and we are working for its deep integration with various sectors and industries.
To nurture industries of tomorrow, the Hong Kong Investment Corporation Limited, or HKIC, was established with US$8 billion in capital. It is patient capital, focusing on deep tech, biotech and new materials, and new energy. It is guiding, channelling and leveraging market capital to support tech industries and segments at their nascent stages to help build the ecosystem. So far, the HKIC has supported over 100 projects, drawing in four dollars of private capital for every dollar it invested. We welcome family offices to form partnerships and co-invest with HKIC.
Third, Hong Kong’s synergistic development with the Guangdong-Hong Kong-Macao Greater Bay Area, or the GBA, which is home to 87 million people with a per capita GDP of US$40,000 on a purchasing power parity basis. It is a young and massive consumer market. The increasingly affluent population has a growing demand for quality financial products and services, and a need for diversified asset allocation.
The GBA is also a technology and innovation hub. Home to many tech giants and start-ups, the GBA has a highly educated workforce, and exceptional commercialisation and advanced manufacturing capabilities. In fact, Hong Kong, together with Shenzhen and Guangzhou in the GBA, is ranked the second most innovative cluster in the world for five consecutive years.
Overall speaking, the GBA is rising as a region combining the advantages of the New York Bay Area and San Francisco Bay Area.
Impact, philanthropy and living
Beyond investments, Hong Kong is also blessed with a vibrant, collaborative philanthropic community. Our financial institutions, businesses, think tanks, local and global foundations and NGOs (non-governmental organisations) have come together to form partnerships that deliver projects that are scalable, and socially and environmentally impactful.
And when it comes to lifestyle, Hong Kong is unmatched in Asia.
Over the past few weeks, the Hong Kong Rugby Sevens and Coldplay lit up our brand new Kai Tak Stadium. Indeed, from world-class performances and Michelin-starred dining to vibrant art, heritage and hiking trails, Hong Kong offers a lifestyle that global families would dream for.
This city also offers the best education for children. More than 50 international schools operate in this city, providing a wide range of curricula to meet the diverse needs of global families. Five of our universities are ranked within the global top 100.
And Hong Kong is among the safest metropolitan cities in the world.
Ladies and gentlemen, it is no surprise that Hong Kong is now home to over 2 700 family offices - half of which manage assets exceeding US$50 million. We expect that number to grow to 3 000 very soon.
To support this growth, we have introduced dedicated tax concessions for single family offices. We are currently working to expand the scope of exemptions and enlarge the eligibility for concessions. There is a bespoke service team under Invest Hong Kong to help family offices with their setup, compliance, talent sourcing, philanthropic engagement, and more. You are most welcome to approach them.
My thanks once again to Deutsche Bank for convening this meaningful Forum. I wish you all a productive forum and an enjoyable stay in Hong Kong - a city which I hope you will call home soon. Thank you very much.
Speech by FS at Deutsche Bank Emerging Markets Family Office Forum in Hong Kong 2025 Source: HKSAR Government Press Releases
