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Hong Kong, as the global financial centre with leading position in Asia, has much to offer to Canadian companies seeking to venture into the region for business and investment, according to the Director of the Hong Kong Economic and Trade Office (HKETO) in Toronto, Miss Gloria Lo.
Speaking at a forum organised by the M&A Club in Montreal today (December 3, Montreal time), Miss Lo briefed the buyers, sellers and service providers of the mergers and acquisitions, and business professionals that the development of Hong Kong's financial services has been given a strong boost by Renminbi offshore business starting in 2004. Taking the first mover advantage and with the full support by the Central Government, Hong Kong has become the premier RMB offshore business centre, handling about 90 per cent of China's total cross border trade settlement in RMB in 2012, up from 73 per cent in 2010. Hong Kong is also the key RMB financing and investment centre, with the largest RMB liquidity pool and the largest RMB bond market outside mainland China.
"The potential of RMB business is enormous," said Miss Lo. "China has already developed as the largest trading country and the second largest economy in the world. We see more and more popular use of RMB as a trade currency and an ideal instrument for foreign companies to finance their investment in mainland China."
In recent years, Hong Kong has benefited a lot by the liberalisation of the financial market of the Mainland, and has provided the testing ground for liberalisation for investment through such schemes as the Qualified Domestic Institutional Investors (QDII), the Qualified Foreign Institutional Investors (QFII), and the RMB Qualified Foreign Institutional Investors (RQFII).
According to the Global Financial Centre Index, Hong Kong ranks the third major global financial centre, just after London and New York. As the eighth largest banking centre in the world and the second largest in Asia, more than two-third of the top 100 banks in the world are operating in Hong Kong. The city is also one of the most favorite places for fund raising. It has a vibrant stock market which is the second largest in Asia in terms of market capitalisation, "Hong Kong's excellent financial system is underpinned largely by the rule of law, simple and low taxation, transparent and sound regulatory regime." Miss Lo added.
Furthermore, Hong Kong is the leading fund management centre in Asia, enjoying 39 percent of year-on-year increase in fund management business. Hong Kong is the largest hub for Asian hedge funds, with total asset size of USD50 billion as of June 2013; and the second largest hub in the region for private equity funds, with a total of USD84 billion of capital under management in 2012.
"We see so much potential for the financial services in Asia given the strong growth in wealth in the region, and the continuous liberalisation of Mainland's financial market," Miss Lo said. "Hong Kong is well positioned to take advantage of all these developments, with our strategic location at the heart of Asia, our sound and robust financial system, and our highly internationalised market. We welcome Canadian companies and financial institutions to leverage on Hong Kong for investment and financing as well as for facilitating further development of their financial services."
Miss Lo noted that earlier this year, the Ontario Teachers' Pension Plan has set up an office in Hong Kong in pursuit of new investment opportunities and better return for its assets. More recently, Montreal Headquartered National Bank of Canada has decided to open its Asian regional brokerage centre in Hong Kong to sell bonds and Canadian equities to institutional investors in Asia. Finally, the government of British Columbia has issued just last month offshore RMB bonds in Hong Kong, setting the precedent of a foreign government issuing offshore RMB bonds.
To facilitate Canadian companies and financial institutions to capitalise on the growing financial as well as inbound and outbound investment opportunities in Asia, HKETO, the Hong Kong Trade Development Council (HKTDC), together with the M&A Club, encourage the Canadian companies to join the Canadian Financial Mission to Hong Kong scheduled for January 12 to 16, 2014.
"The M&A Club delegation will be led by the President of the Club, Mr Brahm Elkin," said the Director (Canada) of the HKTDC, Mr Andrew Yui. "The mission will join 2 400 international participants to attend the Asian Financial Forum as well as additional value-added programmes which are organised to help the Canadian delegates find business partners, investors and investment projects."
The mission is also co-organised by the Investment Industry Association of Canada and the Consulate General of Canada in Hong Kong. For details, please visit www.asianfinancialforum.com .
Ends/Wednesday, December 4, 2013
Issued at HKT 08:15
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