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LCQ2: New Capital Investment Entrant Scheme
     Following is a question by the Hon Carmen Kan and a reply by the Acting Secretary for Financial Services and the Treasury, Mr Joseph Chan, in the Legislative Council today (April 19):
     This year's Budget has proposed to introduce a new Capital Investment Entrant Scheme (the new CIES) with a view to further enriching the talent pool and attracting more new capital to Hong Kong. In this connection, will the Government inform this Council:
(1) of the details of the new CIES (e.g. the implementation date, investment threshold, eligibility criteria, as well as publicity and promotional means);
(2) as it is mentioned in the Policy Statement on Developing Family Office Businesses in Hong Kong released by the Financial Services and the Treasury Bureau that the authorities will explore, in relation to the new CIES, the addition of asset categories benefitting the long-term development of Hong Kong to the investment scope apart from financial assets, of the relevant details; whether the relevant asset categories will include industries such as those benefitting the establishment of an international green technology and financial centre, the "eight centres" which Hong Kong is poised to become as acknowledged in the National 14th Five-Year Plan, or areas of high-quality development such as digital economy, the third generation Internet, or scientific research projects on other key technologies; and
(3) whether it has formulated an evaluation mechanism to measure the effectiveness of the new CIES; if so, of the details; if not, whether it will set targets for the total amount of new capital to be attracted and the number of people coming to live in Hong Kong within two years of the implementation of the new CIES, or fund studies to evaluate the economic benefits brought by the new CIES to Hong Kong?
     In consultation with the Innovation, Technology and Industry Bureau, the Security Bureau, the Immigration Department and Invest Hong Kong, my reply to the three parts of the question is as follows:
(1) and (2) With a view to further enriching the talent pool and attracting more new capital to Hong Kong, the Financial Secretary announced in the 2023-24 Budget that the Government will introduce a new Capital Investment Entrant Scheme (the New Scheme). Applicants shall make investment at a certain amount in the local asset market, excluding property. Upon approval, they may reside and pursue development in Hong Kong.
     The Government is formulating details of the New Scheme which will generally adopt the framework and application criteria of the original Capital Investment Entrant Scheme, with possible adjustments to be made to such matters as the investible areas in Hong Kong and investment threshold.
     We are considering increasing the investment threshold to a multiple of the original requirement. For the investible areas, the Government will consider providing for, apart from financial assets, new asset categories benefitting the long-term development of Hong Kong (including the innovation and technology sector), with a view to attracting more new capital and talents to Hong Kong, bringing new impetus to the economy and fostering the development of industries in Hong Kong at the same time.
     The Government will make an announcement after finalising the details and application arrangements. Wide publicity will be launched through various channels, including promotion by Invest Hong Kong's dedicated FamilyOfficeHK team (which provides one-stop support services to family offices) and Dedicated Teams for Attracting Businesses and Talents or Investment Promotion Divisions (which base in the Economic and Trade Offices around the globe) to target client groups.
(3) The National 14th Five-Year Plan supports Hong Kong to strengthen its position as an international asset management centre. With a comprehensive financial services platform, a vast and liquid capital market connected to the Mainland and our unique advantages under "One Country, Two Systems", Hong Kong is an attractive choice to ultra-high-net-worth individuals for managing their investment portfolios.
     The Government expects that the New Scheme will generate increased demand for financial and related professional services, hence creating more high-quality employment opportunities. It will also channel substantial funds to Hong Kong's capital market, bolstering the development of the asset and wealth management (WAM) industry and strengthening Hong Kong's position as an international WAM hub.
     The Government has not set predetermined performance targets for the New Scheme at this stage. The Government will evaluate the effectiveness of the New Scheme after implementation to ensure its attractiveness to target asset owners in deploying and managing wealth and capturing new investment opportunities in Hong Kong.
     Thank you, President.
Ends/Wednesday, April 19, 2023
Issued at HKT 12:30
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