International investors firmly focused on China's market reforms, growth potential, HKEX's Aguzin says

Asia's Tech News Daily

HKEX, Stock Connect, Bond Connect, Wealth Management Connect, Greater Bay Area

China remains on top of international investors’ agenda as they continue to pour billions of dollars into Chinese bonds and equities despite the pandemic and political tension between Washington and Beijing, according to the boss of Hong Kong’s bourse operator.

This will further strengthen Hong Kong’s role as a connector between mainland China and the global markets, Nicolas Aguzin, chief executive of Hong Kong Exchanges and Clearing (HKEX), said on Wednesday.

“We’re not seeing a decoupling at all. The facts actually point to exactly the opposite,” he said in a video message recorded for the third instalment of the China Conference organised by the South China Morning Post. “Hong Kong has a key role to play in connecting China and the world.”

China attracted US$142 billion of foreign direct investment (FDI) in the first 10 months of this year, 23 per cent more than a year earlier, making it the second largest FDI destination after the US.

HKEX, Stock Connect, Bond Connect, Wealth Management Connect, Greater Bay Area

Nicolas Aguzin, CEO of Hong Kong Exchanges and Clearing. Photo: Handout

International investors’ combined holdings of Chinese bonds and equities stood at 7.5 trillion yuan (US$1.18 trillion) at the end of September, 30 per cent higher year on year and tripling in the last four years, Aguzin said.

US mutual funds and exchange-traded funds had US$43 billion of net assets invested in China as of August, a 43 per cent jump year on year, he added.

“If the past two years have shown us anything, it’s that despite the headline tensions we read about over our morning coffee, reforms have continued to progress, and international investors are becoming more closely integrated with China’s market,” Aguzin said.

“I don’t believe that trend will change. Rather, I see it as the beginning of a wholesale transformation in global markets. Hong Kong has a major role to play in that,” he said.

Beijing this year has granted a series of licences to Wall Street banks and overseas asset managers as it further opens up its domestic financial markets.

In August, JPMorgan Chase became the first foreign firm to win approval from the China Securities Regulatory Commission (CSRC) to take 100 per cent control of its securities joint venture on the mainland.

Other overseas banks like Goldman Sachs, Morgan Stanley and Credit Suisse have also taken advantage of the rule changes to increase stakes in their onshore securities businesses in anticipation of gaining approval to take full control of their ventures.

Also in August, Fidelity International received approval from the CSRC to set up a wholly foreign-owned mutual fund company in China, the second foreign asset manager after BlackRock, which got the go-ahead in June.

The HKEX’s role as a bridge between foreign investors and the mainland cannot be stressed enough. As Chinese companies represent more than 80 per cent of market cap and turnover in the city, it allows international players to invest in Chinese firms listed in the city. Moreover, the bourse has been ranked as the top IPO market globally seven times in the past 12 years.

While the introduction of the Stock Connect and Bond Connect schemes in the past few years has helped increase investments between Hong Kong, regulators continue to introduce new cross-border investment schemes.

The Wealth Management Connect was the latest addition to the list in September. The scheme allows mainland Chinese residents in the Greater Bay Area to invest in Hong Kong funds and other investment products while allowing Hong Kong investors to do the same in mainland fund products.

Aguzin said that assets under management in Hong Kong had increased 21 per cent year on year to US$4.5 trillion last year, making Hong Kong the largest asset and wealth management hub in Asia.

Asset allocations by Hong Kong-based fund managers to mainland China grew 47 per cent year on year to US$337 billion last year, while investments by mainland Chinese investors in Hong Kong domiciled funds grew 18 per cent to reach US$2.2 trillion in 2020.

“While we can expect geopolitics to continue to shape the global narrative, we see heightened interdependency in global capital markets. The capital flows between East and West are deepening, and at a faster pace than ever before,” he said.

“As the world becomes more connected, markets closely integrated, and financial flows more sustained, Hong Kong is in a unique position as a facilitator, conduit, connector, and interface.”

Internet Explorer Channel Network
Asia's Tech News Daily
News Related

OTHER NEWS

Term insurance is getting cheaper

Research agency Moneyview made an overview of the current public health insurance premiums. Since 2002, this policy has become on average 62% cheaper. In 2021 the average premium was again ... Read more »

Army Corps of Engineers gets $14B to help ease supply chains

The Biden administration on Wednesday announced the release of $14 billion to the Army Corps of Engineers to fund 500 projects, with a focus on easing supply chain problems. The ... Read more »

Stocks making the biggest moves premarket: Bank of America, UnitedHealth, P&G and more

Check out the companies making headlines before the bell: Bank of America (BAC) – Bank of America shares rallied 3.2% in the premarket after it beat estimates by 6 cents ... Read more »

Ratan Tata's brother Jimmy Tata 'lives in a humble 2 bhk': Harsh Goenka

Photo of Ratan Tata’s younger brother, Jimmy Tata, shared by Harsh Goenka on Twitter. Harsh Goenka, Chairman of the RPG Group, on Wednesday introduced Twitter to industrialist Ratan Tata‘s younger brother Jimmy ... Read more »

Starbucks to widen online reach in China through new alliance with Meituan, ending coffeehouse chain's partnership with Alibaba-backed Ele.me

US coffeehouse chain Starbucks is gearing up to expand its online presence across China through a new alliance with on-demand local services giant Meituan, ending an exclusive partnership with Alibaba ... Read more »

Emerging talents in spotlight at hybrid Paris Fashion Week

The Associated PressA model wears a creation for the Bluemarble fall-winter 22/23 men’s collection, in Paris, Tuesday, Jan. 18, 2022. (AP Photo/Francois Mori) PARIS — A spattering of Paris Fashion ... Read more »

Interest rates rise: stocks under pressure, good news for pensions

Interest rates on the European capital market are rising. Ten-year government bond yields have passed the zero limit, ending a long period of extremely low and almost continuous negative yields. ... Read more »

China's digital currency: e-CNY wallet nearly doubles user base in two months to 261 million ahead of Winter Olympics

China’s official digital yuan app, e-CNY, had 261 million unique users at the end of 2021, nearly twice what it had in October, even before it was released in app ... Read more »

Europe surpassed green energy target in 2020

Photo: ANP The European Union has more than met its own target for the share of green electricity in 2020, Eurostat has calculated. According to the European statistical office, 22.1 ... Read more »

Vijay Mallya faces prospect of bailiffs knocking on doors of his luxury London home any time now

Vijay Mallya Embattled liquor tycoon Vijay Mallya, who is based in Britain for over five years, faces the prospect of bailiffs knocking on the doors of his luxury London home ... Read more »

Interview: JSW Energy will invest Rs 10,000 crore on capex every year for next 10 years: CEO

Prashant Jain, joint managing director and chief executive officer, JSW Energy Sajjan Jindal-led JSW Energy is in the process of reorganising its business into two entities—the parent which will house ... Read more »

Aircraft manufacturer Airbus wants to hire thousands of employees

Photo: ANP Aircraft manufacturer Airbus needs thousands of new employees. According to the group present in several countries, the aerospace industry is showing strong signs of recovery after the previous ... Read more »

Co-working firm Awfis plans to double office centres to 200 this year

Homegrown co-working space provider Awfis plans to double to 200 its office centres by adding another 60,000 seats by the end of 2022, founder and CEO Amit Ramani said on ... Read more »

What do rising bond yields to signal to the markets?

A note on the data: Interest rates on personal loans for all listed (BSE) public and private sector banks have been considered for data compilation. Banks for which data is ... Read more »

Burberry forecasts 35 per cent surge in annual profit as luxury fashion brands bounce back from pandemic

Burberry Group predicted a 35 per cent jump in profit for the current financial year, driven by a surge of online sales as luxury brands recovered from the pandemic. The ... Read more »

Budget 2022 expectations: Education sector seeks tax concession, low cost loans and expansion of 80C deductions

“For two years, the education sector is struggling in various ways. While the public institutions are looking for more budget allocations, private sector players in higher education need low-cost loans,” ... Read more »

Refrain from publishing paid news, violating RP Act during elections: PCI to print media

Representative Image Ahead of the upcoming Assembly polls in five states, the Press Council of India (PCI) asked the print media on Wednesday to follow the norms of journalistic conduct ... Read more »

Helsinki Shipyard Oy to build new icebreaker for Norilsk Nickel

The icebreaker will operate in the Yenisei River basin, the Yenisei Bay and the Kara Sea Read more »

India's oil production continues to slip, down 2% in December

Representative image India’s production of crude oil, which is refined to produce petrol and diesel, continued to decline in December 2021, with lower output from state-owned ONGC leading to a ... Read more »

After pressure from investors, ExxonMobil also sets itself climate target for 2050: ‘net zero' emissions

ExxonMobil is also the last of the major international oil companies to set a climate target for 2050. The American oil and gas company announced this on Tuesday. ExxonMobil’s climate ... Read more »

Optum center stage at UnitedHealth in 2021, driving revenue

MINNETONKA, Minn. — UnitedHealth Group posted strong fourth-quarter earnings led by double-digit growth in its Optum division. The largest U.S. health insurer posted fourth quarter net income on Wednesday of ... Read more »

Bulgarian president takes oath of office for second term

The Associated PressBulgaria’s President Rumen Radev arrives for an EU Summit at the European Council building in Brussels, Thursday, Dec. 16, 2021. European Union leaders meet for a one-day summit ... Read more »

BAM allowed to renovate famous building in London's Covent Garden

Photo: ANP Construction company BAM has been commissioned to carry out the redevelopment of the Space House in the London district of Covent Garden. Real estate company Seaforth has a ... Read more »

COVID-19 update | WHO counts 18 million virus cases last week as omicron slows

Representative image The number of new coronavirus cases globally rose by 20% last week to more than 18 million, marking a slowdown in the surge caused by the omicron variant’s ... Read more »

Delaying Nord Stream 2 hurts Europe's economic development, warns Kremlin

The construction of Nord Stream 2 was fully completed on September 10, 2021 Read more »

Taking Stock | Market ends lower for the second day; Sensex dives 656 points, Nifty below 18,000

The market continued to see profit-booking for the second consecutive day, with benchmark Sensex and Nifty falling a percent each on January 19 on weak global cues and high crude ... Read more »

Diginoor.io, offering actor Rajinikanth's movie NFT, raises $1 million from Polygon, Kunal Shah

From left to right: Shaamil Karim, co-founder, Diginoor along with co-founder, Yash Rathod. Image: Diginoor. NFT marketplace, Diginoor launched with non-fungible tokens of south superstar Rajinikanth’s movies today announced $1 ... Read more »

Turkey announces launch of air service with Armenia starting February 2

On January 10, the Armenian Civil Aviation Committee gave its okay to operating the Yerevan-Istanbul-Yerevan route Read more »

IEA: tighter oil market due to limited impact omikron on oil demand

Photo: ANP The tightness in the global oil markets is greater than expected because the rapid advance of the omikron variant has had surprisingly little impact on the demand for ... Read more »

Cabinet sanctions Rs 973 crore to SBI for ex-gratia payment to borrowers

Representative image The government on Wednesday approved sanction of Rs 973.74 crore to State Bank of India (SBI) as reimbursement related to loan moratorium that was implemented in 2020 amid ... Read more »

CIABC urges govt to gradually reduce customs duties on British alcoholic beverages under proposed FTA

Representative image The apex body for liquor firms Confederation of Indian Alcoholic Beverage Companies has urged the government to gradually reduce customs duties on British alcoholic beverages under the proposed ... Read more »

Moldova offers paying January debt to Gazprom in stages, says Deputy PM Spinu

The actual risk of gas supplies being cut off exists, he also noted Read more »

'Wage-inflation spiral' warning

Read more »

TikTok owner ByteDance dissolves strategic investment unit amid Beijing's Big Tech scrutiny

ByteDance, owner of popular short video app TikTok and its Chinese sibling Douyin, is dissolving its strategic investment unit and reassigning about a hundred employees, partly in response to Beijing’s ... Read more »

Hitachi Energy bags order worth Rs 160 crore to support electrification of rail routes

Representative image Hitachi Energy India on Wednesday said it has bagged orders of over Rs 160 crore to provide key electric components to support the electrification of rail routes in ... Read more »

Luxury fashion and jewelry more popular than before corona

Last Christmas, Richemont even experienced its strongest sales spurt in at least ten years. Shortly after the outbreak of the pandemic, even fewer of his products were sold. Sales of ... Read more »

The Dutch Data Protection Authority does not have to act against Google

Photo: ANP The Dutch Data Protection Authority (AP) does not have to investigate Google itself. This was determined by the judge in a case brought by the Consumers’ Association. He ... Read more »

Tata Steel Q3 PAT seen up 155% YoY to Rs. 9,676 cr: ICICI Direct

Tata Steel now takes a more prudent approach to its capital allocation strategy. ICICI Direct has come out with its third quarter (October-December’ 21) earnings estimates for the Metals & Mining sector. The ... Read more »

Jindal Stainless Hisar Q3 PAT seen up 78% YoY to Rs. 482 cr: ICICI Direct

A JSLL Infra Stainless bench at the tourist information centre in Delhi. ICICI Direct has come out with its third quarter (October-December’ 21) earnings estimates for the Metals & Mining sector. The brokerage ... Read more »

SAIL Q3 PAT seen up 66% YoY to Rs. 2,125 cr: ICICI Direct

(Image: PTI) ICICI Direct has come out with its third quarter (October-December’ 21) earnings estimates for the Metals & Mining sector. The brokerage house expects SAIL to report net profit at Rs.2,125 crore up ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic