Hong Kong urged to sharpen appeal for China listings
Charles Lee Yeh-kwong, who as chairman of the erstwhile Stock Exchange of Hong Kong lobbied hard with then premier Zhu Rongji to allow mainland companies to list in the city as H shares in July 1993, said Hong Kong had been successful as a fundraising centre in the past two decades but would have to raise its game.
Hong Kong needs to offer cheaper and better listing services to prepare for the competition with stock exchanges across the border when Beijing finally unshackles the yuan, says the man who played a key role in getting the first mainland companies to float in the city two decades ago.
"When China removes its capital controls and the yuan becomes freely convertible, for international investors, there would be no difference between Hong Kong and Shanghai or Shenzhen," Lee told the South China Morning Post.
"If international investors are able to freely trade on the mainland, this would put Hong Kong in direct competition with the mainland stock exchanges."
Lee said the city would need to be prepared for this challenge.
"I don't worry about competition as it helps us to improve. When China fully opens up its markets, Hong Kong can still compete for mainland firms to list here if we can offer a cheaper and more professional services as well as better regulation," Lee said.
"We need to show we can offer the best protection to investors because of our rule of law and good regulation. The Hong Kong stock exchange would need to continue its marketing efforts to get the major mainland firms to list here."