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Following is the speech by the Financial Secretary, Mr John C Tsang, at the roundtable on Islamic finance in Kuala Lumpur, Malaysia this morning (March 18):
Distinguished Guests, Ladies and Gentlemen,
Good morning. It is a great pleasure for me to join you for this roundtable on Islamic finance.
It was back in 2007 that we first signalled our intention to establish a platform for Islamic finance in Hong Kong.
Since then, we have built up our knowledge-bank of best practices on Islamic finance, we have nurtured contacts in various countries, particularly here in Malaysia and throughout the Middle East, and we have successfully launched a number of Shariah-compliant financial products.
These products include Islamic bonds or sukuks, as well as Islamic funds, Islamic indices and Islamic banking windows.
The enthusiasm for these products in Hong Kong has been encouraging.
Last September, Bank Negara Malaysia and the Hong Kong Monetary Authority signed a Memorandum of Understanding on co-operation in developing the financial services sector. The MoU focuses on co-operation on Islamic finance.
This covers areas such as capacity building, developing an effective market infrastructure for Islamic finance and promoting cross-border financial activities.
In Hong Kong, we are currently working to adjust and clarify the relevant tax laws with a view to leveling the playing field for Islamic bonds vis-ˆj-vis conventional bonds.
Let me take this opportunity to thank you for your support and for sharing your expertise on Islamic finance with us in Hong Kong.
On one level, we are competing for a share of the same pie. On another, more significant level, our collaboration can grow the Islamic finance pie and open up new opportunities for these tailored financial products in different markets, including in the Mainland of China.
Hong Kong can play a significant role in structuring and financing Islamic investment products to meet the needs of Mainland Chinese borrowers.
We already have a great deal of experience in dovetailing the two financial systems in Hong Kong and the Mainland. This experience has been extremely useful in introducing Islamic finance into our financial development.
Hong Kong has a stable, open and transparent financial infrastructure.
Throughout the global financial crisis, our banks have remained well-capitalised and our markets are liquid. Our stock market is the third largest in Asia and seventh largest in the world by market capitalisation.
Now, with the worst of the global financial crisis behind us, we look forward to moving onto a new phase in promoting Hong Kong as a platform for Islamic finance. In particular, I am confident that Hong Kong has what it takes to become a niche market in Asia for sukuks.
I look forward to learning more about your views on how we can co-operate further to grow the Islamic finance pie in Asia and open up new markets.
Thank you.
Ends/Thursday, March 18, 2010
Issued at HKT 14:26
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