Hong Kong’s Financial Services Development Council (FSDC) has published a concept paper examining how the city’s capital markets may need to evolve as competition between global financial centres intensifies and digitalisation reshapes market structures.
The paper notes that Hong Kong remains a major international financial centre, with assets under management reaching HKD35.1 trillion at the end of 2024 and a long-standing position as a leading global IPO venue. At the same time, it points to changing issuer profiles, including a growing number of pre-profit and innovation-driven companies, as well as faster market development efforts in other financial hubs.
Connect schemes
According to the FSDC, Hong Kong enters this phase with established advantages. These include its Connect schemes, which provide two-way access between mainland Chinese and international investors, and market infrastructure such as the Central Moneymarkets Unit (CMU). The paper also refers to Hong Kong’s legal and regulatory framework and its ecosystem of professional services as part of this foundation.
The concept paper explores how Hong Kong could broaden its issuer base, deepen the investor pool and expand the range of investable products. It places emphasis on governance, transparency and risk management, and discusses the potential role of new technologies, including tokenisation and blockchain-enabled infrastructure, in supporting cross-border issuance and post-trade processes.
Time-phased roadmap
To structure the discussion, the FSDC sets out a non-binding roadmap. In the short term, it points to possible refinements to listing channels for pre-profit and IP-intensive firms, as well as measures to support secondary market activity.
Over a medium-term horizon, the paper looks at extending Connect schemes beyond equities and bonds and developing platforms for private assets. In the longer term, it discusses scaled tokenised issuance, further development of offshore renminbi markets, and the evolution towards a multi-asset, multi-currency capital formation hub.
