Growing Fund Management Industry To Benefit Hong Kong

by Mary Swire, Tax-News.com, Hong Kong

14 August 2007

Attracting fund managers will boost the development of Hong Kong's financial services, encouraging the industry to develop new and exciting portfolios and products to entice fund managers to invest their clients' capital, according to Secretary for Financial Services and the Treasury Professor KC Chan.

In the latest FSTB & You article, published on the Financial Services & the Treasury Bureau's website, Prof Chan said these fund managers will also identify new investment vehicles, expanding the scope of financing activities and strengthening Hong Kong's position as an international financial centre.

"Hong Kong offers many unique advantages for fund houses establishing headquarters or regional offices in Asia. Undoubtedly, one of our most important advantages is our close relationship with the Mainland," he said.

"China's booming economy has led to a rise in personal savings that has generated demand for investment products and wealth management services. Our cultural and linguistic links and our expertise in dealing with the Mainland means that Hong Kong is best placed to serve as the preferred asset management centre for the Mainland in the long run.

"The asset management business is an important growth area for Hong Kong as an international financial centre. In recent years, the development of [this] industry has gathered tremendous momentum and I am confident it will continue to gather pace."

By the end of last year, Hong Kong's combined fund management business amounted to HK$6.154 trillion (US$786.6 billion), up 40% on 2005, and an aggregate growth of more than 70% on the past two years. It was equivalent to 4.2 times Hong Kong's GDP in 2006, compared to 3.3 times in 2005.

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