Financial Centre

17.       We need to consolidate and enhance our position as an international financial centre in the Asian region. This is consistent with our national and regional interests. Our leading position on the financial front is underpinned by various factors, including the rule of law, market system, freely convertible currency, protection of property rights, sound infrastructure, good corporate governance, the free flow of information, high efficiency, a business-friendly environment, and business practices aligned with international standards. To maintain our leading position, we must pursue further liberalisation. For instance, the source of enterprises seeking to list in Hong Kong should be broadened. We should quickly amend existing listing rules to enable well-established and qualified foreign enterprises from different parts of the world to list in Hong Kong. We also need to continue to enhance our regulatory regime to keep it in line with international standards. The Financial Reporting Council will come into operation early next year. It can help attain world-class standards by strengthening corporate governance and investor protection. In addition, we will host the Asian Financial Forum to reinforce Hong Kong’s prestige as an international financial centre.

18.       Hong Kong is now experienced in the Renminbi (RMB) business after running it smoothly for two years. Expanding RMB business represents a natural progression and a development priority for Hong Kong that is consistent with the national policy. The State Council is actively studying the scope for further expansion of RMB business in Hong Kong, which includes allowing Hong Kong importers to settle in RMB the accounts of direct imports from the Mainland and the issuance of RMB bonds in Hong Kong. The SAR Government is fully prepared to launch these two types of new business as soon as possible.

19.       To meet the demands of the Mainland market, Hong Kong can develop a whole range of risk management instruments. In this regard, we will conduct an in-depth study on the development of the commodity futures market. We will also endeavour to attract to Hong Kong some of the offshore securities investment business of Mainland insurance agencies. The international insurance and reinsurance markets in Hong Kong can provide reinsurance services for the Mainland’s fast-growing insurance industry.