Following is the speech by the Financial Secretary, Mr Paul Chan, at the Private Wealth Management Association Wealth Management Summit 2024 today (November 22):

Amy (Chairman of the Executive Committee of the Private Wealth Management Association (PWMA), Ms Amy Lo), ladies and gentlemen, 

     Good morning. It gives me great pleasure to join you all again at the annual PWMA Wealth Management Summit. 

     The theme of today's Summit, "Navigating New Norms: Drive, Connect, Transform", aptly summarises the investment environment we are in, and what we need to do in the face of uncertainty and potential headwinds. 

     Here we will hear the perspectives on many pertinent issues from prominent private bankers, asset and wealth management specialists and many other professionals. Today’s summit is truly timely. 

Hong Kong's strong fundamentals

     For friends who are coming from abroad, I'm happy to report that Hong Kong's fundamentals as an international financial centre have remained as strong as ever. Recently, Hong Kong returned to the top three global financial centres, along with New York and London. The Fraser Institute has once again ranked Hong Kong the world’s freest economy.

     Yet from time to time, we come across misperceptions about Hong Kong, such as those on the outflow of funds.  

     A few important facts will illustrate that international investors remain highly confident in Hong Kong. 

     First, bank deposits. Since the beginning of 2023 till September this year, bank deposits soared by around 11 per cent. That was equivalent to around HK$1.7 trillion.  

     Second, the stock market, which gradually regained growth momentum and rose by about 15 per cent year to date. And this year, we have raised about HK$70 billion in IPOs (initial public offerings), ranking fourth in the world. 

     Third, a vibrant private equity and venture capital ecosystem. With total capital under management of over US$230 billion, Hong Kong is in the second position in Asia, only behind the Mainland. We are Asia’s No. 1 hedge fund base.   

     Fourth – and you must know better than I do – asset and wealth management. Despite having gone through some challenging years, we continue to see solid overall growth of the asset and wealth management sector. At last count, the AUM (asset under management) of the sector stood at US$4 trillion. That represented some 30 per cent growth compared to 2018.

     Our unparalleled access to the Mainland capital markets, and strategic location within the Greater Bay Area, have instilled strong confidence in international financial institutions in the outlook for Hong Kong’s asset and wealth management business. Many of them are expanding their operations in Hong Kong, renting more floor space and relocating their senior executives to this city.  

     And there have been more encouraging developments for the industry. Let me explain.

Greater Bay Area Opportunities

     The first is the enhancement of the GBA (Greater Bay Area) Cross-boundary Wealth Management Connect. The Scheme, since first launched in September 2021, has provided a convenient channel for residents in the region to invest in wealth management products in Hong Kong.  

     With the steadfast support of the Central Authorities, the scheme was further enhanced in February this year. That included enlarging the scope of investment products covered, increasing the investment quota of individual investors, relaxing the scope of investment products, and more. 

     The enhancement was warmly received by GBA residents. In just a few months' time, up to September this year, the cumulative amount of cross-boundary flow of funds went up six-fold, to reach over RMB 91 billion. The majority of the fund flow was from the GBA cities to Hong Kong. This has demonstrated the appeal and quality of the diversified investment product offerings by Hong Kong. 

     The insurance sector, meanwhile, presents good opportunities. The value of new business life insurance premiums from Mainland visitors stood at some HK$60 billion last year, and HK$30 billion for the first half of this year. That represented a jump of some 25 per cent compared to 2018. 

Family Offices

     The second is about family office. The Government has worked on all fronts to create a conducive and vibrant ecosystem for family offices. Hong Kong has the largest number of ultra-high-net-worth individuals in Asia. We are home to some 2 700 single family offices.

     Over the past two years, the Wealth for Good Summits held in Hong Kong have brought together influential family office owners and decision-makers to explore strategies for effective wealth succession. As part of the effort to nurture a vibrant family office ecosystem, last year, we launched a network of Family Office Service Providers, and established the Hong Kong Academy for Wealth Legacy to share knowledge, facilitate talent training and provide networking opportunities. 

     Last month, in partnership with Bloomberg, we also established the Hong Kong Family Office Nexus that will engage in community building, knowledge sharing, technology support and philanthropic collaboration.

     Building on the current tax exemption for eligible investments by single family offices, we will consult the industry on enhancing the related tax regimes with additional exemptions.  

Capital Investment Entrant Scheme

     Third, the new Capital Investment Entrant Scheme. Launched in March this year, the Scheme has garnered an encouraging response. At mid-November, it has received more than 670 applications, potentially bringing in capital of over HK$20 billion.

More opportunities ahead

     Looking ahead, Hong Kong will present increasingly attractive investment opportunities for the asset and wealth management sector. Allow me to share a few observations. 

     First, connectivity. The role of Hong Kong in connecting different financial markets of the world is expanding.  

     Hong Kong has long served as a vital link between the capital markets of the Mainland and advanced economies. The Connect Schemes, initiated a decade ago, provide a trusted channel for both Mainland and international investors to access each other's markets. The schemes have continually expanded in both breadth and depth, encompassing stocks, bonds, exchange-traded funds(ETFs), derivatives, and real estate investment trusts as recently announced. As more products and investment channels emerge, the Connect Schemes will drive more capital and liquidity into Hong Kong. 

     On the other hand, we are committed to expanding our financial ties with emerging markets and promote two-way capital flows, particularly with economies in ASEAN (Association of Southeast Asian Nations) and the Middle East. Last year, we witnessed the listing of an ETF on the Hong Kong Stock Exchange that invests in the Saudi market. Just weeks ago, two ETFs investing in Hong Kong were listed on the Saudi Exchange, one of which has become the largest ETF in the Middle East. Through expanding into these new markets, we will attract more capital and investors from around the globe to Hong Kong. 

     My second observation is that Hong Kong holds a bright future with vast potential. One promising area is financial services, which I have discussed at length.  

     Another promising area is being a headquarters economy and a supply chain management hub. Shifting global dynamics are prompting more Mainland companies to go global and re-align their manufacturing and supply chain networks. In support of their expansion, many will set up regional or global headquarters in Hong Kong for coordinating trade financing, overseeing corporate treasury functions as well as logistics. Our vision is to develop Hong Kong into a hub for regional and international headquarters, and a high value-added supply chain management centre to serve these enterprises.  

     Then, it is innovation and technology. Rapid advancements in technology have opened the door to a bright future for our city. Over the years, we have invested some HK$200 billion in innovation and technology, focusing on four strategic areas: AI (artificial intelligence) and data analytics, biotech, fintech, and new materials and new energy. To accelerate development in these areas, we established the Office for Attracting Strategic Enterprises at the end of 2022. Our concerted efforts have successfully attracted over 100 innovative enterprises to Hong Kong, which are expected to invest more than HK$50 billion in investments and create 17 000 jobs, many of which will be research and management positions. Notably, these companies will also bring along with them networks of companies in the up, middle and down streams of the industry chain. 

     In tandem with our efforts to support technological growth and economic development, we are dedicated to attracting talent from all over the world. Our various talent admission schemes have proven to be highly popular. Nearly 400 000 applications have been received to date. We have approved more than 250 000 of them, and more than 160 000 people have already relocated to the city. Many of them are professionals who are bringing their families, too.

     All these encouraging developments will undoubtedly attract more top executives, professionals, entrepreneurs and high income individuals to Hong Kong. They are valuable sources of wealth that will contribute to the robust business growth of your sector.  

Concluding remarks

     Ladies and gentlemen, while our asset and management sector holds great promise, more needs to be done to realise its full potential.   

     One that requires our collaborative effort is the promotion of Hong Kong. As your Hong Kong Private Wealth Management Report has rightly put it, "[T]his year's survey showed that Hong Kong continues to face perception challenges. Continued efforts through public-private partnerships will be required to receive feedback and address concerns from clients on some of the misinformation that may affect their perceptions of the city."

     The mission of sharing the true Hong Kong story is one that we would count on you as valuable partners. Whether you live here or are just here for a visit, it helps every bit that you bring back and share what you see in this city with your clients and friends. Invite them to come. Hong Kong will always remain open, welcoming and vibrant – both for business and the many pleasures of life. 

     Finally, I wish you all a rewarding Summit and the best of business in the coming year. Thank you.

  

     The Transport Department (TD) today (November 22) alerted members of the public to fraudulent website addresses that pretend to be the HKeToll (see Annex) and seek to deceive users into making payments and obtain their credit card information.

     The TD clarifies that the fraudulent websites have no connection with the HKeToll and has referred the case to the Police for follow-up. The TD reiterates that the HKeToll only uses "#HKeToll" as the sender ID for issuing SMS messages to users or vehicle owners. Users or vehicle owners must log in to the HKeToll website (hketoll.gov.hk) or mobile app to pay outstanding tolls online.

     Members of the public should stay alert when receiving messages without the prefix "#" but purportedly issued by the HKeToll or any unidentified messages, and should not visit suspicious websites or disclose any personal information. Anyone who has provided his or her personal information to the websites concerned should contact the Police. For enquiries about the HKeToll, please call 3853 7333.

     The Government announced today (November 22) the appointment of Dr Ko Wing-man as the Chairman of the Social Welfare Advisory Committee (SWAC); the appointment of seven new members, namely Miss Chow Tsz-ki, Ms Hsu Siu-man, Professor Patrick Ip, Dr Sanly Kam Shau-wan, Dr Chloe Suen Yin-wah, Miss Sze Lai-shan, and Professor Hector Tsang Wing-hong; as well as the reappointment of five incumbent members to SWAC. Their appointments will take effect on December 1 for a term of two years.
 
     The Secretary for Labour and Welfare, Mr Chris Sun, welcomed the appointments. He said, "Dr Ko has rich experience in community service and I am confident that he will be able to lead SWAC in providing valuable advice to the Government. I look forward to the members' sterling advice on the development of Hong Kong's social welfare policy."
 
     He also thanked the outgoing Chairman, Mr Lester Garson Huang, for his outstanding leadership during the past six years and the five outgoing members, Professor Bai Xue, Dr Cheung Sze-wing, Mr Andy Ho Wing-cheong, Dr Lam James Joseph and Ms Eva Wong Ching-hung, for their invaluable contributions to SWAC.

     SWAC reviews social welfare services from time to time and advises the Government on matters of social welfare policy.
 
     The membership list of SWAC with effect from December 1, 2024, is as follows:

Chairman
———-
Dr Ko Wing-man

Non-official members
———————–
Miss Chow Tsz-ki
Ms Hsu Siu-man
Professor Patrick Ip
Dr Sanly Kam Shau-wan
Mr Frederick Lai Wing-hoi
Ms Alice Lau Oi-sze
Ms Anthea Lee Shuk-wai
Dr Wingco Lo Kam-wing
Professor Petrus Ng Yat-nam
Mr Francis Ngai Wah-sing
Dr Pan Pey-chyou
Dr Chloe Suen Yin-wah
Miss Sze Lai-shan
Dr Ricky Szeto Wing-fu
Ms Rebecca Tsai Ching-yu
Professor Hector Tsang Wing-hong
Dr Rizwan Ullah
Mr John Wong Chung
Professor Frances Wong Kam-yuet
Mr Barry Wong Man-sing
Ms Wendy Yuen Miu-ling

     The Government published in the Gazette today (November 22) the Courts (Remote Hearing) Bill, which seeks to provide a clear legal basis for judges and judicial officers to order remote hearings for court proceedings at various levels of courts and tribunals where appropriate, having regard to all relevant factors, as well as the dual requirements of open justice and fair hearing.

     A Government spokesman said, "In response to rising expectations from court users and the community in recent years, the Judiciary has been taking proactive measures in making greater use of technology in enhancing the efficiency of court operations. Remote hearing is one of the Judiciary's key initiatives on the use of technology in this regard. In line with established practice, the Court will direct the use of remote hearings only if it is fair and just to do so, having regard to a host of relevant considerations. It is a case management decision of the Court in the exercise of its existing case management powers."

     The major provisions of the Bill cover the following:

     (a) the details of making a remote hearing order, including the factors to be considered by the Court; 

     (b) the operation of remote hearings, including the powers of judges, attendance of participants, as well as transmission of documents, presentation of objects and signing of documents; 

     (c) the scope and exceptions to the use of remote hearings; 

     (d) the safeguards for open justice in remote hearings; and

     (e) the proposed new offences to criminalise unauthorised recording, publishing and broadcasting of court proceedings conducted through both physical and remote hearings.

     "Taking into account limitations, risks and concerns in adopting remote hearings for some court proceedings having regard to the paramount consideration of ensuring administration of justice, the Bill sets out express exceptions to the use of remote hearings, including hearings of all proceedings relating to national security and criminal trials in all other cases," the spokesman said.

     "As the lack of a physical setting may render remote hearing more susceptible to unauthorised recording and publishing of court proceedings, the Bill contains new offences to criminalise such conduct which may prejudice or interfere with the court proceedings," the spokesman added.   

     Two rounds of consultation on the draft Bill were conducted in February 2021 and June 2022 respectively. In general, public response to the use of remote hearings for civil and criminal proceedings in court, and the proposed legislative exercise has been positive. Key stakeholders including the Hong Kong Bar Association, the Law Society of Hong Kong and law enforcement agencies have also indicated support for the proposed legislation on remote hearings. They also support the increased use of technology to enable more flexible means of disposing court proceedings, which is conducive to enhancing the Court's efficiency and enabling the Court to better tackle unforeseen situations.

     The Bill will be introduced into the Legislative Council for first reading on December 4.

     The Health Bureau (HHB) announced today (November 22) that it has completed examining the review report submitted by the Hospital Authority (HA) in respect of the review conducted earlier in relation to systemic issues involved in hospital management. Agreeing with the direction of the 31 recommended measures and corresponding action plan, the HHB has instructed the HA to accord priority to taking forward the reform work aiming to enhance the latter's governance and structure, with a view to enhancing the overall quality and safety of public healthcare services and upholding public confidence in the public healthcare system.

     The Secretary for Health, Professor Lo Chung-mau, said, "I would like to express my gratitude to the HA's Review Committee on the Management of the Public Hospital System for its in-depth review, which is comprehensive in scope and covers a wide range of the HA's issues, namely governance, appraisal, accountability and distribution of responsibilities, operations, risk management, procedural compliance and more. The review also involves multiple levels ranging from the HA Head Office to hospital clusters, hospitals departments and staff. I agreed with the direction of measures recommended by the Review Committee in the report and have instructed the HA to implement various enhancement measures in a timely manner while monitoring the implementation progress and effectiveness on an on-going basis, and submitting progress reports to the HHB on a regular basis."

     The review report also pointed to the need to examine whether the HA's existing governance and management structure can continue to meet the present-day needs and circumstances of the complex public hospital system. In this connection, the HA will establish a Governance and Structure Reform Committee under the HA Board with the Chairman of the HA Board, Mr Henry Fan, being the Reform Committee Chairman to steer the implementation of recommendations made in the review report regarding governance, accountability and distribution of responsibilities, and relevant reform work. To ensure that timely policy directions and guidance will be given to the Reform Committee, the Permanent Secretary for Health and the Under Secretary for Health will serve as members of the Reform Committee.

     Professor Lo said, "Confronted with pressures on the healthcare system due to an ageing population, a growing prevalence of chronic diseases and persistent increases in medical costs, we must deepen reforms regarding systemic and structural issues in overall public hospital management, so that our public healthcare system can provide the public with healthcare services with quality, safety and effectiveness in a sustainable manner and meet today's community needs while ensuring our valuable healthcare resources are put to good use. This work aligns precisely with the theme of this year's Policy Address, 'Reform for Enhancing Development and Building Our Future Together'."
 
     In light of a number of hospital incidents, the HHB instructed the HA in June this year to conduct a comprehensive review of the systemic issues and the need for reform with regard to the management of public hospitals, and submit a report and recommendations to the HHB. To this end, the HA established the Review Committee to examine the HA's performance across various areas including governance, appraisal, accountability and distribution of responsibilities, operations, risk management and procedural compliance, and subsequently submitted to the HA Board a report and recommendations for enhancements. Having studied in detail the recommendations made in the report, the HA Board and its management team submitted the report and its action plan to the HHB on October 8.