ENTRANT SCHEME RESPONSE POSITIVE

Following the fruitful result of the inaugural Wealth for Good in Hong Kong Summit in March last year, the second summit is set to return on the 27th of this month. This exclusive event is part of the Financial Mega Event Week in March, designed to gather asset owners and family office managers around the globe, highlighting Hong Kong’s unique strengths in the wealth management industry.

The theme chosen for this year’s summit, "Growing with Certainty Amid Growing Uncertainty", symbolises Hong Kong’s commitment to assuming the role of a global financial market leader by blending a competent government with an efficient market. As a navigator steering a rudder to ride through waves, this theme encapsulates Hong Kong's determination to lead investors towards a new dimension in the uncertain global market, safeguard and grow their wealth, and at the same time, foster positive development in society.

The Financial Services & the Treasury Bureau alongside Invest Hong Kong (InvestHK) have dedicated significant effort to organise the summit in recent months. The event aims to provide a platform for discussion and exchange of views for family office delegates from Hong Kong, the Mainland, Southeast Asia, the Middle East, Europe, the US and beyond. They will focus on crucial industry topics such as green technology, art and high-end luxury goods market, philanthropy and wealth legacy, and the sports industry.

Hong Kong stands as an international hub for asset and wealth management with assets under management over $30 trillion. It is also the largest hedge fund centre in Asia and the second largest private equity centre in the region after the Mainland. According to the BCG Global Wealth Report 2023, Hong Kong's wealth management business is projected to grow at 7.6% per annum between 2022 and 2027, with the potential to become the world's largest booking centre by the end of 2025. Through continuous collaboration between the Government and industry stakeholders, we are confident that Hong Kong's position as an international financial centre can be consolidated and further enhanced.

The recent announcement in the Budget Speech by the Financial Secretary emphasised the Government’s proactive efforts to attract more family offices and asset owners to establish their presence in Hong Kong, thereby advancing the asset and wealth management industry. Initiatives include the establishment of a dedicated committee to promote industry development, and extending the Grant Scheme for Open-ended Fund Companies & Real Estate Investment Trusts for three years, etc. We will also further enhance the tax incentives for related funds, single family offices and carried interests, including reviewing the scope of the tax concession regimes, increasing the types of qualifying transactions, and enhancing the flexibility in handling incidental transactions, which is expected to attract more potential funds and family offices to expand their operations in Hong Kong.

Encouraging developments have also emerged in the asset and wealth management industry in Hong Kong. According to the statistics from the Securities & Futures Commission, the net inflow of funds domiciled in Hong Kong surged to $87.1 billion in 2023, marking a year-on-year increase of 92.9%. Just in the fourth quarter of last year alone, net capital inflows amounted to $33.5 billion, an increase of 179% quarter-on-quarter. To gain deeper insights into the current landscape of family office development in Hong Kong, InvestHK has commissioned a professional organisation to conduct a survey and plans to unveil the findings later, including the current number of family offices that operate from Hong Kong.

Reflecting on the inaugural Wealth for Good in Hong Kong Summit held last year when Hong Kong had just emerged from the COVID-19 pandemic, the Government and the industry have worked tirelessly over the past year to advance the development of Hong Kong's asset and wealth management industry, positioning the city as a central hub for global family offices. To become an attractive investment and financing centre for family offices, and cater to their diverse business needs, comprehensive and innovative policies are imperative. In this regard, over the past year, the Government has implemented the eight initiatives outlined in last year's Policy Statement on Developing Family Office Businesses in Hong Kong, including the introduction of the new Capital Investment Entrant Scheme (CIES), tax concessions, the formation of a new Network of Family Office Service Providers, and the establishment of the Hong Kong Academy for Wealth Legacy, amongst others. Since the launch of the new CIES on March 1, the scheme has received a very positive response, with more than 600 enquiries received to date and applications submitted on the first day of the launch.

With the second Wealth for Good in Hong Kong Summit just around the corner, we are poised to once again unite the world's top family office decision makers and managers to explore mutual interests. Together with other international events in the Hong Kong Financial Mega Events Week, we aim to showcase Hong Kong's distinctive advantages and financial influence, fostering positive societal progress and realising "Wealth for Good" - benefitting the community and upholding universal values of mutual inclusivity.

Secretary for Financial Services & the Treasury Christopher Hui wrote this article and posted it on his blog on March 13.

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