00:01External situation, as we know, before we get into the implications of that, I just want to get a sense
00:06of, you know, we were here 12 months back.
00:08Give us an update. What's been the last 12 months like for you guys, specifically as it pertains to the
00:13wealth initiative?
00:15I would say Hong Kong as a financial centre, we've been going all out in terms of reforming our capital
00:22market, at the same time trying to draw international capital here.
00:25As you can see, like, for example, last year, we have 119 listings in Hong Kong, and also the proceeds
00:32that we get our IPO is a record number.
00:36And at the same time, what you see is from capital formation on the wealth management side, we are also
00:41seeing that increasingly more people are interested in family offices in Hong Kong.
00:45And that's why this week we have the World Focus Summit here.
00:48And what's the message this year?
00:51As you said, I think we are in a very complex world. But that said, Hong Kong as a safe,
00:56stable and also sophisticated financial centre is always ready to serve the world.
01:02Like, for example, apart from having the conference here today, we also have a series of reforms and measures to
01:08draw global capital.
01:09In fact, we are going to put together a bill for legislative approval to extend the tax concessions that we
01:16give to family offices and funds to include more asset classes, like digital asset, precious metal, and also private credit.
01:24At the same time, we are also trying to enhance our role as a wealth management centre by leveraging the
01:32overall need of corporates for internal cash management.
01:36So that's why we are going to revamp our law and also our regime to enhance our tax concession to
01:43given for these treasury centres in Hong Kong in such a way that for corporates, if they want to manage
01:48their cash internally through Hong Kong, we have a more favourable regime for them.
01:53That's interesting. So you have structural reforms that you're looking to put in place. So you mentioned you're introducing this
01:58bill. Do you have a timetable for when investors can expect this? Just give us a rough estimation.
02:04In terms of the extension of the tax concession for family offices and funds, hopefully we are going to put
02:11to legislative approval in the early part of this year.
02:13And for the reform they're going to give to the treasury centre reform, the cash management reform, is something that
02:21we are now putting into a legislative proposal and we also put it to approval very soon.
02:26I need to ask the connection and what we're seeing as far as the risk and opportunities because of what's
02:31happening in the Middle East.
02:32And we know, of course, we've talked about this a lot, that Hong Kong has built this Middle East corridor.
02:36In what ways do you think Hong Kong is prepared to receive some of the flows that could be getting
02:43out that part of the world?
02:44Hong Kong is always ready despite what's happening around us.
02:47If you look at the reforms that I said into wealth management, at the same time even reforms that we
02:51have to our capital market by lowering the threshold for weight of voting rights and also at the same time
02:57to expand the definition of technology companies to be listed here, we are always on the drive in terms of
03:02making our market more competitive.
03:04That's number one.
03:04And number two, if you look at the recent number, right now, for example, throughout Invest Hong Kong, we have
03:11around 156 family officers who have already indicated their plan to set up or expand in Hong Kong.
03:17And also this time when we have the Wealth of Good Summit for the fourth time, we are also welcoming
03:22more guests from the Middle East.
03:23Actually, there's one from the Morocco family officers that already indicated and also confirmed their interest to expand here.
03:31So all these are actually showcasing our role as a financial centre and also being a safe, stable and also
03:38sophisticated one in this complex world.
03:40I see. And this group from the Middle East, they're still scheduled to come?
03:42Yes. Yeah.
03:43Okay, I understand. Have we seen any early signs that a transfer of some wealth because of what's happening there
03:50to Hong Kong? What conversations are you, early conversations are you having?
03:53If you recall, the chief executive led a delegation to the Middle East some time ago. At the same time,
03:59as a follow-up, my bureau and also Invest Hong Kong has been closely monitoring the developments throughout with a
04:06view to identifying needs of these companies, corporates and those individuals to see how Hong Kong can serve them better.
04:13And again, that's context. That's why we have increasing interest from the Middle Eastern family officers to come.
04:18And it's also being seen from the turn-out from this year's Well-Focused Summit.
04:22Right. You mentioned one of the attractions is this massive listing market. Very good year, of course, for ECM last
04:30year. 117, I think.
04:32119.
04:32119 is what you mentioned. Recently, there's been some, I wouldn't say confusion, but there's been some conversations around the
04:41tightening of regulation around the types of IPOs, the quality of deal work that's happening.
04:46What's the government's message to investors who might not be getting the complete picture on what's taking place?
04:52Fundamentally, we are a quality market. That's what we try to do in terms of maintaining that.
04:57Because fundamentally, for a market to strive, it has to be underpinned by quality regulation and also quality in terms
05:03of liquidity.
05:04So we will still continue our efforts to make sure that our market is a quality one for global, regional
05:09and also local investors.
05:10Did it get too hot in a sense that we reached some capacity issues last year that we needed to
05:16sort of take a bit of a chill pill and just understand and just ensure the quality of the deals?
05:22I must say, our regulators have always been on the forefront in ensuring the quality of our market.
05:28At the same time, if you look at the liquidity and also the turnover of our market, it has been
05:32very positive in terms of being a very sound platform to serve corporates when they have their financing needs.
05:38So we will continue to do that to make sure that we are open to business.
05:42You mentioned private credit and gold. Both have somewhat wobbled recently.
05:46Gold prices, as you've probably seen, have come down a little bit.
05:49Private credit, some worries around withdrawals in other parts of the world, it's worth noting as well.
05:54Does that concern you at all, given the longer term initiatives you want for both those asset classes?
05:59I would say what we are trying to do here is to provide a platform in such a way investors
06:03who have the risk appetite,
06:05they'll be able to leverage our platform to do their wealth management needs and also at the same time to
06:09pursue their own interests.
06:10And that's against the spectrum. Apart from having this new regime to extend the tax concession for these new asset
06:16classes,
06:16we are also making Hong Kong an international gold trading centre.
06:20Against that backdrop, we are going to expand our gold storage capacity to beyond 2,000 tonnes in three years'
06:26time
06:27and also building a centralised clearing system for OTC gold contracts.
06:31And I guess you still can't tell us where the gold vault is going to be located, right?
06:34I'm kidding. I know you're the chair of that.
06:36Final question. Is it too early to figure out what the impact on growth for GDP, growth will be for
06:43Hong Kong,
06:43and also inflation because of what's going on?
06:45Yeah. I think Hong Kong has been very resilient throughout, despite the different economic cycle and also different changes.
06:51And of course, we have been, like other economies, closely monitoring what's happening around us in terms of its impact
06:56on us.
06:57But so far, in terms of our achieved economic growth last year, I think it's very promising, 3.5%
07:02real growth.
07:03And we will continue to pursue reforms on all fronts to make sure that we continue to be competitive.
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