Hong Kong capital market will help unlock China's innovation ambitions, HKEX boss says

Beijing's push for the high-quality development of China's economy will require technology and innovative enterprises, which will rely on the support of regulators to grow and attract investment, according to the CEO of Hong Kong's stock exchange operator.

China is a hub of innovative companies, and start-up technology needs access to capital, which is where Hong Kong's fundraising capability comes into play, said Bonnie Chan Yi-ting, the CEO of bourse operator Hong Kong Exchanges and Clearing (HKEX).

"Hong Kong's capital markets will continue to implement the listing system methods that support these emerging enterprises to access fundraising," she said on Wednesday at the Lujiazui Forum in Shanghai.

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Continuous innovation of Hong Kong's listing regime, such as the introduction last year of the Chapter 18C framework that allows technology pioneers in strategic fields to raise capital even before they earn revenue, goes hand in hand with supporting technology enterprises, she added.

Meanwhile, technology such as artificial intelligence (AI) represents an opportunity for China's finance industry to gain a competitive edge over its global peers, according to Seth Bernstein, president and CEO of Alliance Bernstein Group.

"The Chinese market could essentially leapfrog those capital markets in the United States, North America and Europe, which are burdened with legacy infrastructures and regulatory frameworks," he said.

Technology and data science are able to drive more informed asset allocation, as well as rational allocation of resources across the broader economy, he said.

AI has helped Alliance Bernstein find faster and more cost effective ways to manage portfolios, which ultimately helps the company make better use of its human talent, improving productivity, he added.

"We must look to the end game," Bernstein said. "Analysts can combine traditional data sets with unstructured data sets to give better asset allocation advice."

The two-day forum has drawn about 70 speakers and officials from institutions including the People's Bank of China, Hong Kong's Financial Services and the Treasury Bureau and the Monetary Authority of Singapore, as well HSBC, Citi, Goldman Sachs, CICC and JP Morgan.

People walk on a bridge in the Lujiazui financial district in Shanghai on June 5, 2024. Photo: AFP alt=People walk on a bridge in the Lujiazui financial district in Shanghai on June 5, 2024. Photo: AFP>

At the event, China's top securities regulator Wu Qing, chairman of the China Securities Regulatory Commission (CSRC), announced a set of fresh measures to burnish the appeal of the Star market, China's five-year-old Nasdaq-style board.

The CSRC will also continue to crack down on market misconduct as part of its push to drive innovation and boost the quality of listed companies, Wu said in a keynote speech earlier on Wednesday.

The Forum, held in the Lujiazui financial zone near the Shanghai Stock Exchange and the 632-metre Shanghai Tower, the world's third-tallest skyscraper, is seen as an influential finance industry gathering that speaks to Shanghai's ambitions as a global financial centre.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

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