Following is the speech by the Financial Secretary, Mr Paul Chan, at the Global Financial Leaders' Investment Summit - Conversations with Global Investors today (November 5):

Kelvin (Chairman of the Securities and Futures Commission, Dr Kelvin Wong), Eddie (Chief Executive of the Hong Kong Monetary Authority, Mr Eddie Yue), distinguished guests, ladies and gentlemen,

     Good morning.

     It is a pleasure to join you again.

     Today's discussion centres on identifying new growth opportunities across geographies, sectors, and technologies. In that spirit, allow me to share a few observations which I believe are factors shaping the investment landscape, and why Hong Kong is where you want to invest in.

Artificial intelligence

     Let me begin with the transformative power of artificial intelligence (AI) and digitalisation.

     It is no exaggeration to say that AI has become the defining keyword of our era. From boardrooms to classrooms, logistics hubs to laboratories, AI is reshaping the way we live, work, play and communicate. According to the World Trade Organization, up to half of global trade growth this year is estimated to be driven by AI-related expenditure. Global private capital investment in AI has already exceeded US$190 billion this year alone.

      But these figures reflect more than just enthusiasm. They signal a structural shift. AI is no longer confined to a single sector. It is a powerful enabler across sectors: finance, logistics, healthcare, smart manufacturing, and beyond.

     China recognises the strategic value of AI. In the recommendations on the 15th Five-Year Plan laid out by the Fourth Plenary of the CPC Central Committee, AI plays a central role in advancing Digital China. They call for accelerated breakthroughs in foundational theories and core technologies, robust supply of computing power, algorithms and data, and comprehensive application of "AI+" across science, industry, culture and societal governance.

     Here in Hong Kong, we share a similar vision, which is to be realised by a twin-engine strategy: developing AI as a core industry, and promoting AI as an enabler to upgrade traditional sectors. Our strategy rests on six pillars: computing power, algorithms, data, application scenarios, capital and talent.

     And we are well positioned. Three of our universities are ranked among the global top 20 in AI and data science. As Nvidia's CEO Jensen Huang noted, some 50 per cent of global AI researchers are Chinese. Amid geopolitical tension, an increasing number of these researchers are coming here, using Hong Kong as their base for academic research and application of research outcomes.

     He also remarked that the Greater Bay Area (GBA) was the only region in the world where mechatronics technology and AI technology simultaneously reside. 

     Indeed, with strong advanced manufacturing capabilities, the GBA is a region where AI can be directly and seamlessly applied, tested and validated in real-world industrial settings.

     Hong Kong is making great strides in building a vibrant and globally connected AI ecosystem. A key element of this effort is attracting leading enterprises in the field to Hong Kong. To this end, we have rolled out different initiatives supported by dedicated incentive schemes and funding. We are also investing directly and co-investing with others in AI companies, start-ups and projects. Through the Hong Kong Investment Corporation Limited, we magnify our leverage by channelling more private sector capital into the sector.  

     Talent is indispensable if we are to succeed in AI. We have therefore modified our talent admission schemes accordingly and launched such initiatives as AI Talent Connect to bring together top AI talent from around the world in Hong Kong, and help establish a network of young AI talent here to facilitate their collaboration and synergistic growth and development.

Sustainability

     The second observation is about sustainability.  

     For the world at large, despite the United States' withdrawal from climate commitments, the momentum for net-zero transition elsewhere remains strong. Particularly in China, which is expected to invest nearly US$820 billion in energy transition this year, accounting for around 40 per cent of the global total.

     Hong Kong is actively contributing to regional green transition. We are Asia's leader in green and sustainable finance. In 2024, over US$80 billion in green and sustainable debt was arranged in Hong Kong. There is a diverse range of issuers, including local and overseas business enterprises, multilateral organisations like development banks, and Mainland provincial and municipal governments.  

     As an international financial centre, Hong Kong is deploying innovative financial instruments to address the diverse climate financing needs of emerging economies. Catastrophe bonds, for example, are valuable risk-transfer instruments for countries vulnerable to natural disasters. Since 2021, seven cat bonds have been issued in Hong Kong, totaling US$800 million, supporting countries across Asia and the Americas in sharing with investors typhoon and earthquake risks. Another example is insurance-linked securities.

Innovations in finance

     My third observation is this: financial services are key enablers of innovative activities in the economy. We need to be innovative with a ready-to-reform mindset to capture the opportunities arising from changing economic fundamentals.

     In Hong Kong, we always embrace change. A prime example is the ongoing reforms of our listing regime. Since 2018, we have introduced a series of measures to facilitate more new economy companies to list on our Stock Exchange, including those with a weighted voting rights structure, and pre-revenue or pre-profit biotech firms. In 2023, we introduced new arrangements to facilitate pre-commercial specialist technology companies to get listed.

     As a result of this spirit of reform and innovation, the share of new economy companies in our market has more than doubled, growing from 16 per cent of total market capitalisation in 2017 to 35 per cent today. In terms of IPO (initial public offering) proceeds, they accounted for 45 per cent of funds raised from 2018 to the first half of 2025.

     Indeed, we see substantial room for growth in our capital markets. The positive outlook of China's development and technological advancement supports the optimism. At present, the combined market capitalisation of the Hong Kong, Shanghai, and Shenzhen stock exchanges stands at approximately 100 per cent of China's GDP (Gross Domestic Product). In contrast, the corresponding figure for stock exchanges in the United States is over 200 per cent.

Conclusion

     Ladies and gentlemen, the above three observations - AI, sustainability and innovation in finance - demonstrate the agility, creativity and innovative spirit of Hong Kong in navigating changing dynamics in the global and regional economic landscape. This is why Hong Kong offers tremendous growth opportunities.
 
     We are connecting capital with ideas, innovation with applications, and investors with new opportunities across Asia and beyond.

     With the staunch support of the Central Authorities, our unique advantages under the "one country, two systems" framework, our world-class institutions and talent, pro-business, pro-innovation government policies, and our unwavering commitment to excellence, I am confident that Hong Kong will continue to shine as a premier international financial centre. A place that creates boundless opportunities for global investors.

     Thank you very much.

Ends/Wednesday, November 5, 2025
Issued at HKT 11:30

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