Hong Kong’s Finance Chief, Paul Chan Mo-po, has offered reassurance amid a stock market rout that has seen global investors selling off Hong Kong stocks. Speaking at the Hong Kong Capital Markets Forum 2024, Chan emphasized that the city’s financial market continues to operate smoothly and efficiently, with no abnormalities observed. He also addressed concerns about the impact of the mainland Chinese economy on Hong Kong’s stock market, stating that China’s economic development is steadily progressing according to plan.
Chan highlighted China’s GDP growth of 5.2 percent in 2023, surpassing the government’s target and rebounding from the effects of the COVID-19 pandemic. He pointed to indicators such as social financing, monetary credit, electricity consumption, passenger flows, and freight volume as evidence of China’s strong and resilient economy. The finance chief explained that China’s focus is now on high-quality development, aiming to make the economy more innovative, efficient, and sustainable.
In terms of Hong Kong’s financial market, Chan noted several positive indicators. Bank deposits in the city grew by over 5 percent in 2023, demonstrating a net inflow of funds. Hong Kong also issued bonds worth $507 billion in the first nine months of the year, an increase compared to the previous year. Additionally, the city boasts approximately $4 trillion in total assets under management, positioning it as a leading financial hub in Asia.
Addressing concerns about the attractiveness of Hong Kong to capital, Chan highlighted the potential inflow of funds from the Middle East region. He stated that due to the global political landscape, capital from the Middle East, including sovereign wealth funds and family offices, is actively seeking investment opportunities outside of Europe and the United States. With total assets of sovereign wealth funds from the oil-rich region reaching $3.6 trillion, Chan expects a significant amount of funds to flow into China.
Overall, Chan’s reassurance comes at a time when Hong Kong’s stock market is experiencing a selloff. He emphasizes the resilience and stability of both the city’s financial system and the Chinese mainland economy. By providing insights into China’s economic performance and highlighting positive indicators in Hong Kong’s financial market, Chan aims to combat negative narratives and alleviate concerns about the future of Hong Kong as a global financial center.
