ENG-2013 — Page 96

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Financial and Monetary Affairs

return of 4.4 per cent for the period from December 2000 (the inception of the MPF system) to December 2013.

Chart 9

HK$ Billion

600

Total NAV of MPF Schemes

514

440

400

365

356

309

200

0

2009

2010

2011

2012

2013

Year

Product Offerings in Commodity Trading

Hong Kong operates one of the most active physical gold markets in the world. Spot gold can be traded through two closely related yet independent markets in the city: the Chinese Gold and Silver Exchange Society and the Loco London gold market. The society provides trading of both tael and kilo bars3. Prices track closely those in the major gold markets in London, Zurich and New York. In addition, Hong Kong is one of Asia's largest over-the-counter gold trading

centres.

In addition to operating Hong Kong's securities and derivatives markets, HKEX also owns the London Metal Exchange (LME). The LME is the world centre for industrial metals trading and price-risk management. More than 80 per cent of global non-ferrous business is conducted on the LME and its prices are used as the global benchmark. The LME registered another record trading year in 2013, with 171.1 million lots transacted, up 7.1 per cent from 2012. HKEX is building a clearing house in London, LME Clear, to support the LME's commodity business.

Major Initiatives in 2013

Continuous efforts were made in 2013 to enhance Hong Kong's competitiveness as an international financial centre. The government continues to work closely with regulators and the industry to align with the international regulatory reform agenda to promote stability of the financial system, improve market quality and strengthen investor protection. It also continues to press ahead with various initiatives to consolidate Hong Kong's leading role as the Asia- Pacific region's asset management centre, advance financial co-operation with the Mainland, further develop offshore RMB business and enhance the functions of its funding platform.

Tael bars are of 99 per cent fineness and weighted in taels (one tael equals approximately 1.20337 troy ounces). Kilo bars are of 999.9 parts per thousand fineness and weighted in kilograms.

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