IMF reaffirms Hong Kong’s standing as world monetary hub | Hong Kong
This aerial photograph taken on June 27, 2017 exhibits the surroundings on the each side of the Victoria Harbour in Hong Kong. (LUI SIU WAI / XINHUA)
HONG KONG – The Hong Kong authorities on Wednesday welcomed the Worldwide Financial Fund (IMF) report which reaffirmed town’s place as a global monetary centre with a resilient monetary system, sound macroeconomic and prudential insurance policies, and strong regulatory and supervisory frameworks.
In an announcement, the federal government famous that the IMF’s Monetary System Stability Evaluation Report confirmed that Hong Kong’s macroeconomic and prudential insurance policies have supplied it with essential buffers to deal with the present financial slowdown and future shocks.
“Rigorous stress checks carried out by the IMF confirmed that Hong Kong’s monetary system stays resilient in excessive stress situations,” the assertion reads.
The federal government famous that the IMF’s Monetary System Stability Evaluation Report reaffirmed town’s place as a global monetary centre with a resilient monetary system, sound macroeconomic and prudential insurance policies, and strong regulatory and supervisory frameworks
The report famous that strong regulatory and supervisory coverage frameworks are in place to help the monetary sector’s improvement, and the institutional framework for systemic danger monitoring and oversight is properly established.
“The banking sector stays properly capitalized, worthwhile, and nonperforming mortgage ratios stay low,” the IMF report reads.
“Hong Kong SAR’s alternate charge mechanism, the Linked Change Charge System, has continued to help monetary stability, and is underpinned by giant overseas alternate reserves,” it added.
Hong Kong is a serious worldwide monetary centre with one of many largest monetary sectors on this planet. Its banking system holds belongings equal to round 9.5 occasions its gross home product (GDP), and is a serious contributor to the profitability and complete belongings of a number of world systemically essential banks.
The town is a worldwide asset and wealth administration centre, with belongings underneath administration amounting to 10 occasions its GDP in 2019, and it hosts one of many world’s largest inventory exchanges, with a market capitalization of US$6.1 trillion.
The monetary hub’s life insurance coverage sector can also be among the many world’s largest, and it has the biggest overseas alternate swap market in Asia, the report added.
Monetary Secretary Paul Chan Mo-po stated the optimistic appraisal clearly acknowledges the federal government’s long-standing efforts to safeguard monetary stability.
“We’ll proceed to bolster our core strengths, give full play to our distinctive benefits and establish new areas of development, with a view to making sure the long-term competitiveness and prosperity of Hong Kong,” Chan stated.
Secretary for Monetary Providers & the Treasury Christopher Hui Ching-yu thanked the IMF for its honest and balanced evaluation, which once more confirmed the resilience and stability of Hong Kong’s monetary system.
The federal government additionally welcomed the IMF’s evaluation that coverage oversight of the monetary system is powerful and has been modernized.
In line with the report, banking supervision and regulation in Hong Kong continues to be sturdy, and that regulation and supervision within the insurance coverage sector has been strengthened following the institution of the Insurance coverage Authority.
It welcomed the authorities’ efforts to handle the dangers of local weather change, together with the implementation of climate-related necessary monetary disclosures by 2025, adoption of the Widespread Floor Taxonomy, and promotion of climate-focused stress testing for the monetary sector.
The report famous that the disaster administration framework in Hong Kong has been considerably strengthened by the introduction of a complete decision regime underneath the Monetary Establishments (Decision) Ordinance in 2017, additional safeguarding the soundness of the monetary system.
Hong Kong is well-positioned to develop monetary know-how and acknowledged the fast improvement of the fintech business, in accordance with the report.
It added that the authorities play an lively function in selling town as a fintech hub in Asia and undertake a proactive strategy to advertise monetary innovation and inclusion.
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The report additionally famous Hong Kong’s strong regime to battle cash laundering and terrorist financing.
The federal government stated it’s going to fastidiously research, along with monetary regulators, the suggestions the IMF made to reinforce the already strong monetary system.
The IMF Mission visited Hong Kong in September 2019 and carried out a digital mission in February and March for discussions with authorities authorities, monetary regulators and market gamers.The report was thought of and adopted by the IMF Govt Board on Might 21.
With inputs from Oswald Chan