Hong Kong Exchanges and Clearing will next Monday double capacity of its trading system to handle 3,000 trades per second and aims to push it up to 50,000 trades per second to fend off competition from overseas exchanges. Hong Kong is one of several major exchanges upgrading their systems. Japan last week launched a US$145 million system, Arrowhead, which has the ability to handle one trade in about 0.005 second, hundreds of times faster than its old system, which took two to three seconds and was among the slowest in the world. Outgoing chief executive Paul Chow Man-yiu, the exchange's longest serving boss and the man who built up the local electronic trading and clearing platform, announced the latest technology upgrade plan in his last press conference yesterday. HKEx's electronic trading system, AMS/3, will handle 3,000 orders per second, or 21.6 million orders in the normal four-hour trading day from Monday. This is still slower than Japan's new system, but Chow said Hong Kong's system would be scaled up to handle 15,000 orders per second in the second half of next year, bringing it level with Japan's new system. Ultimately, Chow said Hong Kong's system would be able to handle 50,000 transactions per second. 'We are not in a race with Tokyo's stock exchange which has spent a huge amount of money upgrading its system after a major problem some years ago,' Chow said. 'Hong Kong's system is always being upgraded and its speed has always been in line with international standards. Most importantly, the system's reliability and backup have performed well. The system's stability and backup are more important than speed,' Chow said. Chow wrapped up his two-decade career at the helm of the exchange by reporting that the whole market's capitalisation has grown from HK$600 billion in 1989 - when he first joined the stock exchange as head of IT - to HK$1.75 trillion now. He became chief executive of the stock exchange from October 1991 to 1997 before leaving to head HSBC Asset Management for six years. He then returned to become chief executive of the enlarged HKEx - which was formed in 2000 by combining the stock exchange, futures exchange and clearing house, from 2003. Chow earned plaudits from brokers for boosting the market by introducing electronic trading and clearing systems to Hong Kong in the 1990s and bringing mainland companies to list here since 1993. At present, there are 524 mainland firms listed in Hong Kong, representing 58 per cent of its total market capitalisation and 78 per cent of total turnover. 'I am lucky to have so many people who love and support me. The stock market's achievements over the past two decades are the result of hard work and collective wisdom from my colleagues and from the many exchange stakeholders,' he said. Chow was philosophical about the controversies that cropped up during his tenure, such as the introduction of quarterly reporting or the closing auction system. 'It was good to have these debates so everyone could share their views on how to move the exchange forward,' he said. The 63-year-old Chow refused to say what was his next step. He also refused to comment on his successor Charles Li Xiaojia, a former investment banker who worked with Chow for three months to prepare for the new job. 'I am sure Charles Li will do a good job,' he said. And he let reporters in on the secret of why they could never surprise him as he left his office. 'There is a secret exit at IFC One so I can leave secretly whenever reporters are waiting downstairs. I have shared this secret with Charles,' Chow said. 'I will leave the office at 5.30pm this Friday. Catch me if you can.'