Capital markets

This story was published in the SCMP’s Education Post on 28 September, 2016.

China’s rapid development is not a threat to Hong Kong’s role as an international financial centre; it is a huge opportunity, according to Sir Chow Chung-kong, chairman of the Hong Kong Exchanges and Clearing Limited (HKEX) and MBA alumnus of CUHK Business School.

“In the long term, the new journey of the Hong Kong financial market will help transform Hong Kong into a wealth management centre, an offshore risk management centre, and a global asset pricing centre for China,” he said. “Over recent years, mainland companies have raised more than US$600 billion in our market. We are one of the top IPO markets in the world, a status we could never have achieved by ourselves.”

Last year, for the fourth year in a row, Hong Kong raised more funds than New York, London, Tokyo, and Frankfurt. “But times are changing, the mainland is becoming more sophisticated, and its capital market has become one of the largest in the world,” he said.

As China now has sufficient capital, what it needs now is improved diversification and risk management. So, how can Hong Kong become an integral part of this process?  “We need to change, as we did in the 1990s,” Chow said.  “We need to recognise the new landscape, and find ways to add value. We cannot sit back and wait for China to come to us anymore, because China has options. We need to compete.”

Read the full article here.