Hong Kong wants to grasp the opportunities resulting from ongoing trade tensions, the city’s Financial Secretary Paul Chan said at a S&P Global Market Intelligence roadshow.
This as Hong Kong maintains its openness and global connectivity through "bold" reforms to deepen and diversify its financial markets, Chan said.
"We believe this is where international investors want to be," Chan said at the June 5 roadshow in Hong Kong. "This optimism is underpinned by our robust fundamentals: large fiscal reserves, sound external balance sheet, resilient monetary system and a track record of transparent and effective policymaking," Chan said.
As a free port reliant on global trade flows, Hong Kong is caught in the trade tensions playing out between mainland China and the US. Starting in early April, China and the US announced a series of tariff moves on each other, which eventually pushed the world's two biggest economies to declare that they would tax imports by up to 145%. On May 12, the US and China agreed to de-escalate the situation by delaying the proposed tariffs by 90 days while negotiators worked on a trade deal.
Chan said the roadshow came as global economic and geopolitical landscapes "undergoing profound transformation, driven by both short-term shocks and long-term structural shifts."
"In the near term, it is the tariff war and the drastic, flip-flopping policies of the Trump Administration which have contributed to great uncertainty and heightened market volatility," Chan said. Beyond these immediate disruptions, we are witnessing deeper, more enduring trends that will shape the global order for the decade to come."
But investor sentiment has proven resilient and strengthened in Hong Kong, according to Chan, with the stock market rising, bank deposits growing and Hong Kong Exchanges and Clearing Ltd. being the top IPO market globally year-to-date.
"The recent inflow of capital into Hong Kong has demonstrated that our fundamentals are robust and trusted by investors. We serve as a safe harbor for international capital," Chan said.
Hong Kong's stock market rose around 18% in 2024 and has gained more than 15% so far this year, Chan said. IPO fundraising has reached HK$77 billion, making Hong Kong the top IPO market globally year-to-date. Bank deposits grew by 7% in 2024 and an additional 4 per cent this year. They now exceed HK$18 trillion, he said.
