Hong Kong emerges stronger as leading global financial center

Hong Kong has regained its position as one of the world's top three financial centers, defying naysayers claiming "Hong Kong is over" and underscoring its great resilience and potential backed by the Chinese mainland.

Hong Kong rises to 3rd place in global financial centers index

Hong Kong has climbed one spot to rank third globally and first in the Asia-Pacific region, reclaiming a prestigious position it had lost over the past two years, according to the Global Financial Centers Index (GFCI) report released on Tuesday by the British think tank Z/Yen Group and the China Development Institute in Shenzhen.

The report, which has been published biannually since 2007, evaluated 121 financial centers and highlighted Hong Kong's rise to first place in investment management, as well as its jump of five spots to ninth in fintech services. The city also ranked highly in key areas such as business environment, human capital, and infrastructure.

"This year’s results show a renewed confidence in Hong Kong's financial market, demonstrating its resilience and adaptability amid a rapidly evolving global environment," said the Hong Kong Financial Services Development Council in a statement.

Shang Hailong, a member of Hong Kong’s Legislative Council, noted that Hong Kong’s return to the top three was "unsurprising" given the city’s enduring competitive advantages in financial services and corporate finance, largely driven by the "one country, two systems" framework.

Liang Haiming, president of the China Silk Road iValley Research Institute, pointed out that Hong Kong’s role in the global financial system, especially within the Asia-Pacific region, has grown more significant.

Hong Kong, a leading global financial hub

Over the decades, Hong Kong has become a leading global financial hub, offering world-class services across sectors such as banking, stocks, and bonds, benefiting from strong support from mainland China and its deep connections with international markets.

As a "super connector," Hong Kong has seized more opportunities and achieved significant growth since rejoining China in 1997.

Despite challenges, including social unrest in 2019, the COVID-19 pandemic, and rising geopolitical tensions, Hong Kong, like other open economies, has weathered tough times. Some critics predicted a bleak future, suggesting capital flight and the city's decline as an international financial center.

However, the latest GFCI report affirms Hong Kong’s resilience, as it continues to attract global investors and businesses.

"We're not seeing major banks leaving Hong Kong. On the contrary, many financial professionals are returning from places like Singapore and Dubai, where they stayed during the pandemic," said George Chen, managing director and head of The Asia Group’s Hong Kong office.

"Hong Kong remains highly competitive in the global race for financial dominance," Chen added.

Xiao Geng, chairman of the Hong Kong Institution for International Finance, reinforced this sentiment, emphasizing that while some media have painted Hong Kong as less attractive, it continues to be a prime destination for foreign investment.

By the end of 2023, assets under management in Hong Kong had grown by around 2% compared to the previous year, totaling over 31 trillion Hong Kong dollars (approximately 4 trillion USD). Net fund inflows reached 390 billion Hong Kong dollars, a year-on-year increase of more than 3.4 times.

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