With its strategic location, supportive government policies, and robust financial infrastructure, Hong Kong has become a leading international finance centre. Not only has Hong Kong established extraordinary performance in the financial market, it is also a global leading IPO venue and one of the world’s largest capital markets. Buoyed by investor demand and market sentiment, what actions can Hong Kong take to further develop its IPO and capital market to enhance its status? Suggestions to strengthen Hong Kong as a premier global capital formation centreRegarding the mentioned issues, the Financial Service Development Council (FSDC) has done research on how to further enhance Hong Kong’s IPO offerings as the Hong Kong IPO market has its specific advantages and ability to evolve and develop new frameworks. These suggestions include: Updating the listing framework in response to market developmentTo respond to recent market development, the government should create a friendly listing framework for innovative pre-revenue companies. In order to provide flexibility in the listing regime to capture these opportunities alongside appropriate investor safeguarding, it is important for Hong Kong to leverage its international fundraising hub advantages. Providing an effective financing channel for SMEsSMEs are a vital and integral part of Hong Kong’s economy, so Hong Kong’s financial market should consider ways to provide diversified financing options for them. Rapid development in ESG has provided new perspectives to providing financing support for SMEs. Also, as an international finance centre, Hong Kong can enable the implementation of the “dual circulation” development blueprint in the GBA and other Mainland areas. Overall RecommendationTo stay in the competition and strengthen Hong Kong’s proposition as a leading capital formation hub in Asia and the world, a tactical review of the exiting listing requirement for these companies would be essential in order to embrace the opportunities in the new economy and emerging sectors. To conclude, with the lingering global geopolitical hiccups and evolving investor and issuer behaviour, in addition to the uncertainties embedded, Hong Kong cannot risk resting on its laurels. FSDC believes that by proactively seeking to refine its listing regime so as to stand ready when historical opportunities present combined with constant efforts to introduce market enhancements, Hong Kong will advance as a premier global capital formation centre.
