Financial Secretary Paul Chan this morning pledged that the Government will consolidate and enhance Hong Kong’s strengths as an international financial centre (IFC) to create more new growth areas.

In his 2025 Budget Speech, Mr Chan said the key to consolidating and enhancing the strengths of Hong Kong as an IFC lies in institutional innovation, product innovation, a critical mass of enterprises and financial connectivity.

To dovetail with the latest economic trends and corporate needs, Mr Chan said the Government will review listing requirements and post-listing ongoing obligations, evaluate listing-related regulations and arrangements to improve the vetting process, optimise the thresholds for dual primary listing and secondary listing, and review the market structure, including exploring the establishment of a post-delisting over-the-counter trading mechanism.

Riding on the reduction in minimum price spreads to be implemented in the middle of this year, Hong Kong Exchanges & Clearing is reviewing with the Securities & Futures Commission (SFC) the trading unit system or the so-called “board lot” system.

They will put forward proposed enhancements this year so that trading arrangements can better meet liquidity characteristics of shares of different sizes and investment needs as well as facilitate trading and improve efficiency.

To meet the risk management needs of investors, the SFC will consult the market on the proposal to increase the position limits for key index derivatives, so as to enhance flexibility for investors to use the relevant derivatives while safeguarding financial safety.

On product innovation, Mr Chan noted that the Government will soon promulgate a second policy statement on the development of virtual assets and conduct a consultation on the licensing regimes of virtual asset over-the-counter trading services and custodian services this year.

It will also propose measures to promote gold market development this year.

Additionally, the Government will explore enhancement measures to the legal and regulatory regime related to the issuance and transactions of digital bonds to promote the wider adoption of tokenisation in Hong Kong’s bond market.

The finance chief said the Government will organise a flagship forum in the second half of this year to promote Hong Kong’s strengths in fixed income and currencies.

Noting that the industry responded favourably to a pilot scheme on insurance-linked securities, with the issuance of six catastrophe bonds facilitated in Hong Kong and an issuance amount totalling over $5.8 billion, Mr Chan said the pilot scheme will be extended for three years.

On fostering the development of the asset and wealth management industries, Mr Chan said the Government will formulate proposals on the preferential tax regimes for funds, single family offices and carried interest this year.

He outlined that the proposals will include expanding the scope of “fund” under the tax exemption regime, increasing the types of qualifying transactions eligible for tax concessions for funds and single family offices, enhancing the tax concession arrangement on the distribution of carried interest by private equity funds.

To keep attracting global capital to Hong Kong, the Government will be hosting the third edition of the Wealth for Good in Hong Kong Summit shortly under the theme “Hong Kong of the world, for the world”, showcasing Hong Kong’s strengths as a global hub for family offices.

In addition, the inaugural Hong Kong Global Financial & Industry Summit will also be held to pool together global enterprises, funds and technologies through financial empowerment, thereby elevating the level of international co-operation of industries.

Revealing that the People’s Bank of China and the Hong Kong Monetary Authority are working closely to implement the linkage of faster payment systems of both places, Mr Chan said he expected the round-the-clock real-time, small-value cross-boundary remittance service for residents in both places to be launched in the middle of this year at the soonest.

The finance chief added that a public consultation on specific proposals of Mandatory Provident Fund “full portability” will be held this year.