District Jinglin: Hong Kong has four growth paths and wealth management has potential.

Photo: Mr Au Jinglin pointed out that the continuous growth of Hong Kong's asset and wealth management market is very important to Hong Kong's economic development.

In order to consolidate and enhance international finance centre's position and enhance its competitiveness, the Executive Director of the Financial Development Council, Mr Au Jinglin, delivered a special speech at the Annual Meeting of the Hong Kong Association of Independent Non-executive Directors 2024 yesterday, saying that Hong Kong can develop from four new growth paths, namely, an asset and wealth management center, an international sustainable financial center, a digital asset center and an international innovation and technology center.

Mr Au Jinglin pointed out that Hong Kong's asset and wealth management market continues to grow, and the asset and wealth management industry is very important to Hong Kong's economic development and the global financial ecosystem. According to the report of Boston Consulting Group, Hong Kong is expected to surpass Switzerland to become the world's largest transaction bookkeeping center in 2027. By 2022, Hong Kong's total assets and wealth management assets (AUM) are about HK$ 30 trillion, of which 64% are from non-Hong Kong investors.

Hong Kong is committed to expanding the family office business. Mr Au Jinglin said that Hong Kong is the first choice for the development of family offices in Asia, and the SAR government aims to attract at least 200 family offices by 2025. Hong Kong has a series of measures to attract family offices to settle down, which can be divided into eight projects. First, a new "entry plan for capital investors" is introduced; Second, provide tax relief, and family investment control tools managed by a single family office in Hong Kong will be exempted from profits tax; Third, to provide market-friendly measures, the licensing division of the CSRC will set up a dedicated communication channel to handle inquiries about family offices; Fourth, the Hong Kong Institute of Wealth Heritage was established, and the SAR government funded the establishment of a brand-new Hong Kong Institute of Wealth Heritage to provide personnel training services; Fifth, promote the art storage facilities at the Hong Kong International Airport, and study the establishment of exhibition facilities at the airport to benefit the family offices whose assets are invested in art; Sixth, develop Hong Kong into a charity center and simplify the procedures for charitable organizations to apply for tax exemption; Seventh, further expand the functions of the FamilyOfficeHK task force of InvestHK; Eighth, set up a new family office service provider network.

Accelerate the construction of Web3 ecosystem

As an international sustainable financial center, Mr. Au believes that Hong Kong, as a green technology and green financial center, can accelerate its development in five key directions, namely, building a green technology ecosystem, promoting the application and innovation of green finance, green certification and aligning with international standards, strengthening exchanges and cooperation with Greater Bay Area and international markets, and strengthening personnel training and education in the fields of green technology and green finance.

In promoting Hong Kong to become a digital asset center, Mr Au pointed out that the SAR Government issued a policy declaration on the development of virtual assets in Hong Kong at the end of October 2022, clarifying the policy stance and guidelines set by Hong Kong for developing virtual assets industry and ecosystem, and was open and inclusive to institutions and companies involved in virtual assets business. For example, he pointed out that the CSRC recognized the virtual asset futures ETF so that retail investors could invest in regulated virtual asset products.

Regarding the technology of the International Innovation and Technology Center, Mr. Au said that the SAR Government is committed to supporting the development of the third-generation Internet (Web3.0) ecosystem. In the 2023-2024 budget, it allocated 50 million yuan to accelerate the development of the Web3 ecosystem, including holding large-scale international seminars, so that industries and enterprises can better grasp the cutting-edge development, promote cross-sectoral business cooperation and hold more youth workshops. In addition, the SAR Government set up a task force on Web3.0 development at the end of June last year, aiming at providing suggestions on the sustainable and responsible development of Web3 in Hong Kong.