The Government will continue to reinforce and enhance Hong Kong’s status as an international trade and financial centre, tapping opportunities in the nation’s development and the eastward shift of global economic gravity, Chief Executive John Lee said today in his 2023 Policy Address.

While maintaining close ties with European and American markets, Mr Lee declared that Hong Kong will look to increase trade with markets involved in the Belt & Road Initiative.

To explore business opportunities with Mainland enterprises, Hong Kong will organise more outbound missions involving Hong Kong and Mainland enterprises, and organise visits to the Greater Bay Area (GBA) for overseas enterprises operating in Hong Kong.

The Chief Executive added that the Hong Kong Special Administrative Region Government will set up additional offices for business and trade along the Belt & Road, and consolidate co-operation and connections with markets in ASEAN (the Association of Southeast Asian Nations) countries and the Middle East. He said that Hong Kong will soon sign an investment agreement with Türkiye and is negotiating a free trade agreement with Peru, plus investment agreements with Bahrain, Bangladesh and Saudi Arabia.

Mr Lee explained that Hong Kong is also seeking to enrich the terms of the Closer Economic Partnership Arrangement signed by Hong Kong and the Mainland in 2003 with a view to allowing Hong Kong enterprises to tap the nation‑wide domestic consumption market.

Meanwhile, an Action Plan on Modern Logistics Development, due to be published later this year, will focus on smart development, internationalisation, and green and sustainable modernisation. In the first phase, Mr Lee said, the Government will develop modern logistics clusters in the Hung Shui Kiu/Ha Tsuen New Development Area, which will serve as a logistics gateway to the GBA. An information platform to facilitate flows of data and goods across the GBA will also be established.

The Government will also continue to promote Hong Kong’s convention and exhibition (C&E) industry and will raise the city’s C&E space by 40% to 220,000 square metres by expanding facilities at the Asia World-Expo and building new C&E facilities in Wan Chai North, Mr Lee said.

He added that the Government will continue to support the city’s small and medium enterprises (SMEs). He explained that the Commerce & Economic Development Bureau will establish an inter-departmental E-commerce Development Task Force to implement policies assisting Hong Kong’s SMEs in developing e‑commerce business on the Mainland, while the statutory cap on the contingent liability of the Hong Kong Export Credit Insurance Corporation will be raised from $55 billion to $80 billion. The corporation will also upgrade its free credit check services for policyholders in relation to buyers from the 10 ASEAN member states, giving exporters more confidence in accepting overseas orders.

In terms of the financing needs of SMEs, the Government will provide more flexible repayment options under the SME Financing Guarantee Scheme. Mr Lee added that by the end of this year the Monetary Authority’s Commercial Data Interchange will be connected to the Government’s Consented Data Exchange Gateway, enabling financial institutions to obtain more useful data for accelerating credit underwriting.

Additionally, Cyberport will launch the Digital Transformation Support Pilot Programme by the end of this year to subsidise SMEs in the retail and food and beverage sectors in applying for electronic payment and other digital packages.

Mr Lee also explained that he had accepted the recommendations made by the Task Force on Enhancing Stock Market Liquidity and would implement a number of measures.

He said stamp duty on stock transfers would be reduced from the current 0.13% to 0.1% of the consideration or value of each transaction and that the Government hoped to complete the necessary legislative procedures for this reduction by the end of November. He added that Hong Kong Exchanges & Clearing (HKEX) and the financial regulators will explore reducing minimum trading spreads to better reflect market circumstances and reduce bid‑ask spreads, while HKEX will also provide fixed fee enterprise data packages and implement a new fee structure for its real-time data services later this year.

Moreover, Mr Lee outlined that HKEX plans to implement revised Listing Rules in the first quarter of next year, following a consultation on Growth Enterprise Market reform in which it has proposed to streamline the transfer mechanism to the Main Board and add a new listing route for R&D‑focused companies, among other proposals. He added that he has asked the Securities and Futures Commission to work with HKEX to examine how to implement further recommendations made by the abovementioned task force.

The Chief Executive added that Hong Kong will strengthen connections between domestic and overseas investors and markets, and seek to deepen mutual access with the Mainland financial market.

He said the Hong Kong SAR Government will press ahead with the inclusion of RMB counters under the Southbound Trading of Stock Connect programme to facilitate the trading of Hong Kong stocks in RMB. It will also expand the participation of Hong Kong financial institutions in the Qianhai Co‑operation Zone, including through facilitating the qualification of Hong Kong’s limited partnership funds under the Qianhai Qualified Foreign Limited Partnerships. Moreover, it will co-establish the Shenzhen‑Hong Kong Financial Co‑operation Committee with the Shenzhen authorities in the first half of 2024. 

Mr Lee added that a new integrated fund platform will be established within the next year to expand Hong Kong’s fund distribution network, enhance market efficiency and lower transaction costs, and that the Government will launch a proof‑of‑concept subsidy scheme for green fintech in the first half of 2024. He said the scheme will contribute significantly to Hong Kong’s development as a green fintech hub.