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Hong Kong: China's international financial centre with global reach
Real estate news By Malcolm J. Naudi
Sun, Oct 14, 2007
At the end of last month, when I was in Hong Kong for a week's visit, the local stock market, known internationally as the Hang Seng Index, went through a series of record highs, breaching first the 26,000 level, then the 27,000 level and, since my return, even the 28,000 level. Apart from visiting the exchange and seeing the trading floor, I got some official insight into the financial services scene, with parallels to Malta, from Sarah Kwok, Deputy Secretary for Financial Services, within the Secretary (ministry) for Financial Services and the Treasury.
With the need for co-operation among them in mind, Ms Kwok said MOUs (memoranda of understanding) have been signed between them, "particularly in areas where they feel a need for co-operation (like areas where) there would be convergence or cross-sector business". The only exception is the Commission for Insurance, which is headed by a civil servant, "but we are in the process of turning it into an independent authority in a few years' time in line with international trends". The securities market is overseen by a three-tier regulatory structure, she explained: "The first tier is in the government: we deal with the policies and the legislation; the second tier is the statutory regulator - the Securities and Futures Commission (SFC).
Financial services, along with insurance and real estate, is one of the five pillars of investment that the Hong Kong government is seeking to attract to this Special Autonomous Region (SAR) of China. The others are tourism, logistics/transport, air (air transport and cargo), and business services (outsourcing and trading). Financial services not only contribute 12.7 per cent of Hong Kong's GDP and uses about six per cent of its manpower but, as Ms Kwok pointed out, this is a high value-added sector with high wages and a strong multiplier effect on the economy, creating jobs in support services, entertainment and property, including office rental.
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