ENG-2008 — Page 128

84 Financial and Monetary Affairs

Hong Kong's insurance industry also made capital of CEPA during 2008. Under CEPA's Supplement IV, a centre was established in Hong Kong for local residents to take Mainland examinations to qualify as insurance intermediaries in the Mainland. The supplement also enabled local insurance agencies, with Certificates of Hong Kong Service Supplier, to establish wholly-owned companies in the Mainland to provide insurance agency services to Mainland insurance companies.

The accounting sector also benefited from CEPA's liberalisation measures. Two supplementary agreements were signed on July 29, 2008 between China's Ministry of Finance and Hong Kong's Financial Services and the Treasury Bureau exempting Hong Kong's practising accountants from sitting for a third paper in the Mainland's accountancy examination and to extend this exemption to all members of the Hong Kong Institute of Certified Public Accountants (HKICPA). Other liberalisation measures include the proposed setting up of an examination centre in Hong Kong for the Mainland's Accounting Professional Technician Qualification Examination and dedicated examination centres in the Guangdong Province for Mainland's accounting qualification examination. Furthermore, the validity period of temporary audit permits issued to Hong Kong accounting firms has been extended from two years to five years.

Economic Summit on 'China's 11th Five-Year Plan and the Development of Hong Kong'

A 'Focus Group on Financial Services' was formed in January 2007, arising from the economic summit on 'China's 11th Five-Year Plan and the Development of Hong Kong' held in September 2006 in Hong Kong. Following the summit, the group drew up an 'Action Agenda' containing 80 recommendations and an overall direction for developing Hong Kong as China's international financial centre and establishing a co-operative, complementary and interactive relationship with the Mainland's financial systems. Progress was made in over one-third of the 80 recommendations by the end of 2008. This included the launching of gold futures by the HKEX on October 20, and continuous efforts to facilitate financial co-operation with the Mainland. The Government and Hong Kong's financial regulators will continue to foster links between Mainland and Hong Kong markets to widen the scope of their operations and to strengthen their effectiveness. Hong Kong will also try to expand the business of its financial institutions in the Mainland, and help Mainland capital, investors and financial institutions make better use of the city to go global. To keep up the momentum, the HKEX will continue to lead intermediaries in promoting Hong Kong as the premier capital raising centre for Mainland enterprises.

Guangdong-Hong Kong Financial Co-operation

Guangdong is the Mainland province closest to Hong Kong not only in terms of geographical location, but also culture and economic links. Guangdong and Hong Kong have been exploring ways to strengthen financial co-operation with each other. The first 'Guangdong-Hong Kong Financial Co-operation Forum' was held in Guangzhou in October. More than 300 delegates from Guangdong and Hong Kong