Speech by FS at Asia Private Equity Forum 2017 (English only) (with photo/video)
Eric (Chairman of the Hong Kong Venture Capital and Private Equity Association (HKVCA), Mr Eric Mason), David (Chairman of the Asia Private Equity Forum and Executive Director of the HKVCA, Mr David Pierce), distinguished guests, ladies and gentlemen,
It is a pleasure for me to be here this morning, to have this welcome opportunity to address you at this prestigious annual forum.
An eventful time, I might add, given that the Hong Kong Venture Capital and Private Equity Association celebrates its 30th anniversary this year. In doing so, the Association is in good company: the Asian Financial Forum, which has just concluded successfully yesterday, turns 10 this year. And the Hong Kong Special Administrative Region will be 20 years old come July 1.
Your valued Association counts a membership of some 370 corporate leaders: from Hong Kong, from the Mainland as well as many places in Asia and from around the world. That diverse makeup speaks smartly of Hong Kong's singular status as a global hub for business and finance. Speaks, too, of Hong Kong's unique role in bridging Mainland business and investment with the rest of the world.
This unique role that we are performing under the "one country, two systems" framework has also helped Hong Kong stay afloat in an increasingly inconstant and uncertain global economy.
Yes, despite the challenging macro-environment, Hong Kong, last year, once again led the world in IPO (initial public offering) funds raised. We are, as well, Asia's leading asset management centre.
As for 2017, I think we can all agree that plenty of sand traps and bunkers are sure to line the course ahead of us. The possible change of economic policies under the new US administration, the timing and pace of US interest rate normalisation as well as the policy divergence among major central banks are surely among the uncertainties that we have to closely monitor.
And I believe that many of us here today are wondering how Brexit will affect the fragile economic recovery of the Euro area. On the other hand, many of us are anxious to know the effects of fiscal stimulus packages announced by Japanese government in June last year on the country's economy, which has been stuck in low gear in the past decade.
While we continue to closely monitor the development of these matters, rest assured we'll also be moving ahead. Working to make Hong Kong's business and investment environment that much more welcoming and rewarding.
I am speaking of initiatives like the launch of the Shenzhen-Hong Kong Stock Connect, which opened for business just last month.
It is clearly another milestone in the two-way opening up of the Mainland market. And in expanding number of stocks eligible for trading under the mutual access scheme, it will also enhance Hong Kong's position as an international financial centre and global offshore Renminbi business hub.
The progress of the Mutual Recognition of Funds arrangement between Hong Kong and the Mainland has also been encouraging. At the end of November, 54 funds had been authorised by the dual regulators, with aggregate net sales of almost RMB8.3 billion.
I am confident that the arrangement will expand the distribution network for Hong Kong's fund industry. That it will help enable Hong Kong's rise as a fully fledged fund-service centre.
While the Mainland market continues to present abundant opportunities, it is essential that Hong Kong continues to explore new prospects in overseas markets. And for good reason: we are determined to strengthen Hong Kong's position as an international asset management centre.
In this connection, we had a breakthrough recently following the signing of an MOU last month with Switzerland on mutual funds recognition. It is a landmark agreement, marking the first time that Hong Kong's public funds have gained direct access to the European investing public.
Then there is the open-ended fund company (OFC) structure. Noting the increasing popularity of corporate fund structures, we introduced a bill to establish a legal framework for the creation of OFCs here. That bill was passed last June. Our regulatory authorities are working with the Government to implement the OFC as soon as possible.
We believe that the new investment vehicle will create a more flexible business environment and, in doing so, help fund managers meet market demand. That, in turn, can only expand the funds that call Hong Kong home.
There is opportunity as well - and on a massive and unprecedented scale - in the Belt and Road Initiative, designed to expand multilateral ties among more than 65 economies in Asia, Europe and Africa. Among others, infrastructure development and connectivity is a priority.
As an international financial centre, and as China's international financial capital, Hong Kong is well placed to benefit from Belt-Road opportunities in infrastructure financing, offshore Renminbi services, asset management, risk management and much more.
To help realise those far-reaching prospects, the Hong Kong Monetary Authority launched its Infrastructure Financing Facilitation Office last July.
To date, more than 50 organisations from the Mainland, Hong Kong and overseas have joined the Office as partners. They include multilateral financial agencies and development banks, investors, financiers, insurance companies, project developers and professional services firms.
They are on board, and others will follow, because Hong Kong has what it takes to become the Belt-Road's infrastructure investment and financing hub.
That, of course, will demand a great deal from our professional services sector - now and through much of this 21st century.
To that end, we launched a three-year talent training initiative in August last year. The pilot programme emphasises the asset and wealth management and insurance sectors. Under it, there is a financial incentive scheme for in-service practitioners.
And a summer internship programme, allowing undergraduate students to gain exposure to the many job opportunities in the asset and wealth management sector, will be rolled out this summer.
In this, I welcome your support and participation, from offering internship opportunities to making use of the financial incentive scheme for professional training.
With Hong Kong's private equity funds handling about 17 per cent of the total capital under management in Asia, we clearly need more talent if we are to sustain your industry's impressive development.
On that note, I would like to convey my gratitude to the Association for all it has done, over these past 30 years, to raise the profile of Hong Kong's venture capital and private equity industry here in Hong Kong, throughout the region and around the world.
Ladies and gentlemen, the Year of the Rooster is almost upon us. I wish you all a successful Forum. And a healthy, happy and prosperous Year of the Rooster.
Ends/Wednesday, January 18, 2017
Issued at HKT 10:48
Issued at HKT 10:48