BMag Signal · In 30 seconds
Critical readWhat happened. Hong Kong has demonstrated its ability to grow and prosper in the context of significant political and economic changes. The city has maintained high levels of trust and stability thanks to its strategic geographical location and innovative fiscal policies. This success is largely due to its role as an international financial center where we have attracted globally active investors and provided a friendly business environment.
The government suggests that Hong Kong can increase its financial resources if it receives a small portion of global capital invested by insurance and pension funds. The FSDC (Financial Services Development Council) recently stated that Hong Kong can double its financial resources by adding a small portion of global capital invested by insurance and pension funds. Jonathan Wu, member of the human capital committee of FSDC, emphasized that Hong Kong must do more to attract this type of capital 'patent', which are assets that insurance companies and pension funds invest for long periods.
If only a small portion, or about 5% of the global capital invested by insurance and pension funds were invested in Hong Kong, the total financial resources under management in the city would increase by two times. It is important that Hong Kong can work with the regulators of the neighboring north to expand many cross-border connections that allow insurance companies and pension funds from the north to invest in Hong Kong's stocks and debts. This could lead to unprecedented growth for Hong Kong, diversifying their investments and achieving good returns if these funds had access to cross-border connections.
Furthermore, the recent liberalization of policies on the transfer of funds between the north and south has allowed the north to invest in Hong Kong, but pension funds from the south have not yet been authorized to do so here. Therefore, the FSDC suggested that Hong Kong could achieve unprecedented expansion of financial resources if it could welcome international investors, such as northern pension funds, through many cross-border connections. This article highlights Hong Kong's ability to continue thriving amidst significant changes, showing how we can use our strategic geographical positions and innovative fiscal policies to attract globally active investors and provide a friendly business environment.
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