TNAG-2467-FCO40-3591-Economic-situation-in-Hong-Kong-1992 — Page 58

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SECTION 2

A COMPARISON OF SERVICES

INTRODUCTION AND CONCLUSIONS

2.1 A convenient framework to analyse the services which regional and international financial centres offer is provided by the BEQB article of November 1989 (Pages 518-521). The amount of data available about these activities in Hong Kong and Singapore is

rather limited and/or anecdotal and/or out of date. Nevertheless a

picture can be built up which illustrates Hong Kong's and

Singapore's roles as regional financial centres. This reveals that

there is not surprisingly a considerable degree of overlap in the services they supply. However, each centre has peculiarities in the

pattern of supply, related to specific factors in their respective development. The extent of the banking link between Hong Kong and

Japan is the most notable example. Neither centre is as broadly

based as, say, London.

2.2 Over the next decade, assuming that South East Asia and the

Far East continue to be the fastest developing area of the world, the market for financial services in the region as a whole is likely also to grow rapidly. It is likely that with this growth

many countries' own financial sectors will develop and be liberalised further such that, eg. Malaysia and Korea will be able increasingly to finance their own capital needs from international

sources through locally-located international financial companies, without recourse to regional centres like Hong Kong. Nevertheless

the development of the region will also be able to accommodate the further growth of Hong Kong, Singapore and Tokyo, albeit perhaps

regional market for financial

with declining shares of the

intermediation, and perhaps alongside the emergence of other

regional financial centres like Taipei and Bangkok. It is also an

opportunity for London and UK financial firms.