ENG-2019 — Page 79

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The Economy

the cumulative value of realised direct investment in the Mainland from Hong Kong exceeds US$1 trillion, more than half of the total.

Reciprocally, Hong Kong is the largest destination for the Mainland's outward direct investment. Based on the Mainland's statistics, the Mainland's stock of outward direct investment to Hong Kong accounted for 56 per cent of its total outward direct investment position as at end-2018, reflecting Hong Kong's role as a platform for Mainland companies to explore other markets and go global. Based on Hong Kong's statistics, the Mainland is Hong Kong's second largest source of foreign direct investment, accounting for 27 per cent of Hong Kong's total inward direct investment position as at end-2018. Mainland companies maintain a strong presence in Hong Kong as well. As at mid-2019, Mainland companies were operating 1,799 regional headquarters and regional or local offices in Hong Kong, up from 750 a decade ago.

Due to proximity, Guangdong's economic links with Hong Kong are understandably the closest among all the provinces. Based on the Mainland's statistics, the cumulative value of realised direct investment in Guangdong from Hong Kong reached US$304 billion as at end-2019, accounting for 65 per cent of the province's total inward direct investment position.

Building further on the solid ties with Guangdong, Hong Kong works closely with central ministries and the governments of Guangdong and Macao to foster interconnectivity in the flow of people, goods, capital and information within the Guangdong-Hong Kong-Macao Greater Bay Area, so as to bring Hong Kong new areas of economic growth and the opportunity for Hong Kong residents to expand their space for living and development. The Leading Group for the Development of the Greater Bay Area, chaired by Vice Premier Han Zheng and with members comprising the Chief Executives of the Hong Kong and Macao Special Administrative Regions, Heads of the Guangdong Provincial Government and representatives of relevant ministries, held two meetings in 2019, after which policy measures were announced. The measures could be broadly grouped under three categories, namely benefiting members of the public; facilitating the development of professional services, including financial and legal services, in the Mainland cities of the Greater Bay Area; and supporting Hong Kong's development into an international I&T hub.

Over the years, financial links between Hong Kong and the Mainland have strengthened substantially, thanks to the increasing cross-boundary economic activities and the Central People Government's policy to enhance Hong Kong's position as an international financial centre. As a major funding centre for Mainland enterprises, Hong Kong had 1,241 Mainland enterprises listed on its stock market as at end-2019. Of these, 114 were listed in 2019, raising more than $250 billion in equity funds. IPOs and secondary market financing combined raised more than $350 billion in aggregate funds.

Hong Kong possesses the world's largest offshore pool of Renminbi (RMB) liquidity, holding about RMB658 billion of RMB customer deposits and outstanding RMB certificates of deposit issued as at end-2019. RMB bank lending and outstanding RMB bonds stood at about RMB154 billion and RMB169 billion respectively. RMB trade settlements handled by banks in Hong Kong reached RMB5.4 trillion in 2019.

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