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Hong Kong is next door to mainland China’s booming economy
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Tough new U.S. accounting rules discouraged companies from listing in America.
Frederick Ma, secretary for financial services and the treasury said Hong Kong was already benefiting from a new clustering of businesses drawn to the city because of its success in finance. The world’s top 70 banks are operating there, he said. In 1995, the city only had 200 chartered financial analysts, but now it has 3,000 – ranking it No. 4 in the world behind the U.S., Canada and Britain.
However, Hong Kong is heavily dependent on listings by mainland Chinese companies which make up nearly 50 percent of the total market capitalization of $1.59 trillion, according to Hong Kong Exchanges & Clearing.
Shanghai is still a minnow compared to Hong Kong, which has average daily turnover of $4.21 billion – 12 times the volume of Shanghai but many believe Hong Kong will lose some of this investment as Chinese firms might decide to float more shares on the Shanghai Stock Exchange in the coming years.
One thing Hong Kong needs to be more aggressive about doing is attracting IPOs by companies that have operations in China but are owned by firms in the U.S., Canada, Germany and other places, said Ronald Arculli, chairman of Hong Kong Exchanges & Clearing.
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December 26th, 2006 by financetwitter
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