Cross-border connectivity celebrates its tenth anniversary! The Hong Kong Securities and Futures Commission, Hong Kong Stock Exchange and others make significant statements.

As of November 17th, the Mainland and Hong Kong financial markets have been connected for ten years. At the peak forum of the ConnectTen anniversary, Charles Li, CEO of the Hong Kong Stock Exchange (00388), stated that currently, the Shanghai-Hong Kong Stock Connect has become the main channel for international investors to trade and hold Mainland A-shares, with close to 77% of foreign capital holding Mainland stocks through this channel. The Bond Connect Northbound also has become the main channel for international capital to invest in the Mainland bond market. Hong Kong Financial Secretary Paul Chan Mo-po stated that Hong Kong has become the preferred destination for international fund allocations and trading of Mainland financial products. Acting Chief Executive of Hong Kong, Matthew Cheung, mentioned that the Shanghai-Hong Kong Stock Connect has become the most trusted route for international investors to invest in the Mainland securities market. The average daily trading volume of the Shanghai-Hong Kong Stock Connect has increased from approximately 6 billion RMB when it was launched in 2014 to over 136 billion RMB in October this year, a 23-fold increase, accounting for about 8% of the total trading volume of the Shanghai and Shenzhen stock markets. In terms of Hong Kong Stock Connect, the daily trading volume has increased from around 900 million Hong Kong dollars in 2014 to nearly 44 billion Hong Kong dollars on average in October this year, a 46-fold increase, accounting for about 17% of the total trading volume of the Hong Kong stock market, bringing in over 3.4 trillion Hong Kong dollars of capital inflow to the Hong Kong stock market. Bond Connect has become an important bridge between the Mainland and international bond markets. Matthew Cheung mentioned that by leveraging the successful foundation of the Shanghai-Hong Kong Stock Connect, launching consecutive projects will enhance market liquidity and depth, ultimately expanding the investor base. As of the end of September this year, the total amount of Mainland bonds held by overseas institutions through Bond Connect and similar channels exceeded 4.4 trillion RMB, with daily average trading volume of the Bond Connect Northbound increasing from an initial 2.2 billion RMB to over 43 billion RMB in the first three quarters of this year, a growth of over 19 times. Additionally, Matthew Cheung also stated that the Cross-Border Investment Transfer Scheme introduced last year has enabled foreign investors to more effectively manage interest rate risks, and the daily average trading volume of the scheme in October exceeded 19 billion RMB, nearly five times the initial launch. Paul Chan Mo-po, Hong Kong's Financial Secretary, pointed out that the ConnectTen is a measure of institutional reform and infrastructure innovation, unleashing the creativity of the capital market and being a key factor in attracting international investors. As the ConnectTen continues to expand, the variety of investable products continues to grow. Most recently, Exchange-Traded Funds (ETFs) and Real Estate Investment Trusts (Reits) have been added, reflecting the steady expansion of products traded between Mainland and international investors on the exchange platform. He believed that the future investment from international investors into the Mainland will increase, and Hong Kong serves as a key convergence point between the country and the world, accumulating funds and talent. He believed that the ConnectTen can help Hong Kong consolidate and enhance its position as an international financial center, and as the system deepens and expands, there will also be product innovation and risk management optimization. Chairman of the Hong Kong Securities and Futures Commission, Carlson Tong Ka-shing, mentioned at the forum that Hong Kong has differentiated advantages and complements the Mainland market, helping in achieving high-quality development. At the same time, it allows local and foreign investors to share the benefits of development. Regarding listed companies, the combined market value of Hong Kong's stock market and overseas enterprises has reached 3.5 trillion Hong Kong dollars, including international financial institutions and consumer brands. Recently, by actively deepening connections with markets in Asia and along the Belt and Road region, the number of international exchanges recognized by the Hong Kong Stock Exchange has increased to 19, promoting more diversified sources of listed companies and funds. Currently, the market value of new economy enterprises in the Hong Kong stock market has increased significantly to nearly 40%. Looking ahead, Charles Li expressed that the door of China's capital market opening to the outside world will only widen as the second largest global economy. Currently, foreign ownership of Mainland stocks and bonds is less than 5%, indicating significant room for improvement. As the center of global economic development shifts eastward, and China enters a phase of high-quality development, it will provide greater investment opportunities for the world.