Hong Kong's economy owes its high level of prosperity to the support of the mainland's vast economic entity. Today, with the pace of economic development, the economies of Hong Kong and the mainland are becoming increasingly integrated.
In the process of China's economic reform, Hong Kong and Shanghai, as two major commercial and financial centers, have always played an important role as the primary windows for opening up and as key drivers of China's economy. The close connection between the Shanghai and Hong Kong economies is particularly important.
It would be inappropriate to suggest that investing in Hong Kong immigration is solely for the purpose of showcasing personal commercial interests. Most immigrants who settle in Hong Kong are also making silent contributions to the close connection between the Shanghai and Hong Kong economies.
At the "Shanghai-Hong Kong Metropolitan Development Seminar" on the 24th, Hong Kong Financial Secretary John Tsang pointed out that Hong Kong possesses the world's largest offshore Renminbi liquidity pool, and currently 70% of international Renminbi settlements are processed through Hong Kong. The average daily transaction volume of Hong Kong's Renminbi Real-Time Gross Settlement system has recently exceeded one trillion Renminbi. The Hong Kong market also provides mature and diversified Renminbi services, including investment, financing, asset management, and bonds.
This year marks the tenth anniversary of the Renminbi exchange rate reform. The Renminbi exchange rate mechanism has changed from the fixed exchange rate pegged to the US dollar at that time to one pegged to a basket of currencies. In August of this year, the People's Bank of China further improved the central parity quotation of the Renminbi exchange rate, injecting more market-oriented elements to make the exchange rate mechanism more transparent.
With the increasing economic strength of the country, the role of the Renminbi in WorldWay is becoming increasingly important. Enterprises around the world are increasingly using the Renminbi as a currency for trade settlement, and the Renminbi has become one of the world's five major payment currencies. "I believe that in the near future, everyone will be able to witness the historic moment when the International Monetary Fund (IMF) announces the inclusion of the Renminbi as one of the Special Drawing Rights (SDR) currencies," said Tsang.
Leveraging the unique advantages of "One Country, Two Systems," Hong Kong has worked hard over the past decade to align with the policy of Renminbi internationalization, seizing various opportunities to develop into the world's largest offshore Renminbi business center. Hong Kong's fair and WorldWay environment, sound legal and regulatory systems, coupled with perfect infrastructure and a large number of financial professionals, can provide a high-quality "testing ground" and "firewall" for Renminbi internationalization, assisting mainland enterprises to "go global" and "attract" foreign investment, while also helping to promote financial innovation and drive the mainland's financial system to gradually move towards internationalization.
As the mainland's largest and most advanced financial center, Shanghai possesses a vast economic hinterland and gathers capital and talent from across the country. In coordination with the various pilot policies of the Shanghai Free Trade Zone, the potential for capital market development is enormous. Hong Kong and Shanghai are highly complementary in financial development, and there is huge room for cooperation. "The Shanghai-Hong Kong Stock Connect, which was officially implemented in November last year, is a good example," said Tsang. The Shanghai-Hong Kong Stock Connect has opened up the stock markets of Shanghai and Hong Kong, and through the interconnection of the two capital markets, it has promoted the opening of the mainland's capital account and the internationalization of the Renminbi. The Shanghai-Hong Kong Stock Connect has further increased the two-way circulation of Renminbi funds between offshore and onshore markets, which is a mutually beneficial development for both Shanghai and Hong Kong.
The country is about to enter the important moment of the "13th Five-Year Plan." In the economic reform program passed earlier by the central government regarding the "13th Five-Year Plan Proposals," deepening financial reform and promoting the opening of the capital market are important areas, which also mention supporting Hong Kong in strengthening its status as a global Renminbi business hub. "I hope that Hong Kong can coordinate with the financial opening measures launched by the Shanghai Free Trade Zone, continuously enhance cooperation, leverage our respective strengths, and jointly contribute to the country's deepening of financial reform."