Paul Chan: Hong Kong focuses on three areas to promote efficient capital circulation

Paul Chan Mo-po, Financial Secretary of the Hong Kong Special Administrative Region Government, published a blog post on the 18th stating that whether it is supporting economic transformation and development through technology, or using technology to enhance economic momentum and support employment, the key behind it must include efficient funding support. Hong Kong will focus on three areas: mobilizing long-term capital, broadening currency options, and managing and sharing risks, to promote efficient capital circulation. In terms of mobilizing long-term capital, Paul Chan Mo-po introduced that Hong Kong's initial public offerings in the first nine months of this year have raised nearly US$50 billion, double the same period last year and exceeding the full-year total of last year; green and sustainable debt issuance reached US$77 billion last year, with bond issuance ranking first in Asia; infrastructure financing securitization arrangements allow borrowing countries to recover funds earlier and invest in new projects. The power of an efficient international financial market can empower the development of the real economy. Regarding broadening currency options, Paul Chan Mo-po pointed out that more and more Global South countries are settling trade with mainland China in renminbi, and therefore hold large amounts of renminbi. Hong Kong can provide more investment products, risk management tools and liquidity arrangements for these funds. Paul Chan Mo-po also said that based on considerations such as risk diversification, more and more developing economies are coming to Hong Kong to issue renminbi bonds. In fact, the outstanding stock of Hong Kong dim sum bonds (i.e. offshore renminbi bonds) has reached nearly RMB 1.9 trillion, ranking first in the world, with annual issuance exceeding RMB 1 trillion in each of the past two years. Paul Chan Mo-po mentioned that during his recent visits to Nanjing in Jiangsu and Bangkok in Thailand, he found two huge needs very clearly: developing economies need capital and technology, while mainland enterprises need international markets and professional services. He believes that these two needs converge in Hong Kong, which can both channel global capital and connect to the mainland's technology and industry, and has the conditions to enable the development of other economies while further enhancing Hong Kong itself.