Chapter 4
Financial and Monetary Affairs
As a key global financial centre, Hong Kong offers a robust regulatory framework and an extensive network with other major financial hubs as well as fast-growing economies in the region, particularly Mainland China. Hong Kong ranked in the top three of 80 financial centres in the latest Global Financial Centres Index, and its stock market ranked second globally in terms of funds raised through initial public offerings in 2013. The city also has the world's largest offshore pool of Renminbi liquidity, of over RMB 1,000 billion. The financial sector has a 234,400-strong workforce, or 6.2 per cent of the city's total workforce, and contributes 15.9 per cent of the city's Gross Domestic Product.
Hong Kong as an International Financial Centre
Overview
Hong Kong holds a unique position in the increasingly integrated global financial system. Hong Kong enjoys extensive geographical, cultural and linguistic links with the dynamic Mainland economy, and has long served as a gateway between the Mainland and the rest of the world. At the same time, Hong Kong's location at the heart of Asia forms a 24-hour continuous trading system together with New York and London. Hong Kong's position as the leading international financial centre in Asia is further fortified by the strong links with the whole Asia-Pacific region and excellent communications with the rest of the world; the rule of law; a level playing field for conducting business and a sound regulatory regime. The absence of restrictions on capital flows into and out of Hong Kong and strong protection for investors are other advantages.
Hong Kong's financial markets operate under effective and transparent regulations, which are in line with international standards. A well-educated workforce and ease of entry for professionals from outside Hong Kong ensure availability of talent, and this and the highly liquid market are also conducive to the operations of financial institutions in Hong Kong. Hong Kong's competitiveness as an international financial centre is well recognised: the Global Financial Centre Index published by Z/Yen Group in September 2013 ranked Hong Kong as the third global centre, behind only London and New York.
A vibrant securities and derivatives market
With a total market capitalisation of about $24 trillion at the end of 2013, Hong Kong's stock market ranked sixth in the world and second in Asia. The daily turnover averaged $62.6 billion in 2013. At the end of the year, 1,643 public companies were listed on the Stock Exchange of Hong Kong Limited (SEHK), representing a wide range of industries from finance and property to resources and telecommunications. In 2013, the SEHK ranked second worldwide in terms of
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