Post Brexit, Hong Kong remains a vital trade and finance partner for Britain
Jeffrey Mountevans says given the historic links between London and HK, and their leading roles in the world economy, opportunities abound to collaborate, especially in innovative industries
As Lord Mayor of the City of London and ambassador for the UK’s financial and professional services industry, I travel to key markets fostering stronger trade links and promoting Britain as one of the best places in which to invest and do business. As a result of the British public voting in June to leave the European Union, this role is now more important than ever. The world is watching how the UK redefines and establishes its future relationship with the EU and the rest of its global partners. London and the UK have a responsibility to maintain and enhance our position as a truly global financial centre, in service of the global economy for the years to come.
The UK remains open for business – nowhere more so than in Hong Kong, a vital trade and investment partner. Our relationship is based on historic ties, as well as ongoing, shared interests and investments – economically, culturally and in education, with many more opportunities to further develop our links.
Hong Kong is one of the biggest Asia-Pacific markets for UK exports in goods and services; worth £8 billion (HK$82.7 billion) every year. There are over 600 UK companies with a presence in Hong Kong – all benefiting from the city’s world-class business environment and unparalleled economic connections with mainland China. UK investment in Hong Kong is over £33 billion, around 35 per cent of total British investment in Asia. Meanwhile, Hong Kong has long invested in the UK – reaching a record high in 2015, with Chinese foreign direct investment of nearly 70 per cent flowing through Hong Kong overseas.
Financial market collaboration is a priority for our governments and the industry. The UK, and the City of London, has embraced renminbi internationalisation, and we take great pride in our role as “the Western offshore RMB hub”. We evolved this role in close partnership with Hong Kong – complementing its responsibilities as the biggest renminbi offshore centre. Together, we are committed to developing an industry that supports the currency’s growth, as China’s markets open up. In my meetings with the Monetary Authority and Hong Kong exchange, I will discuss how we can continue our work for the benefit of both markets.
So what lies ahead? There are many high-value opportunities for the UK and Hong Kong to collaborate in the innovative industries of the future – such as smart technology, infrastructure, health care, sustainability, FinTech and maritime services.
Innovation has driven the UK’s growth, with world-leading technology clusters from Manchester to Edinburgh, and Belfast to London. We are keen to build a strong FinTech partnership with Hong Kong to enable efficient and high-value interactions across international financial services. The UK and Hong Kong also share expertise in infrastructure financing, and have much to offer our global partners. My visit will encompass the new Infrastructure Financing Facilitation Office of the HKMA, and I will explore how Hong Kong and London can support the financing of major international infrastructure programmes – in particular, under China’s Belt and Road initiative and the UK’s National Infrastructure Plan.
Moreover, with 44 years in shipbroking, I want to strengthen links between the UK and Hong Kong’s maritime sectors. The UK is the world leader in maritime business services, and knows the importance of remaining competitive and supporting the ship-owning and operating business, which is moving increasingly eastwards. Together, Hong Kong and the UK have much to offer in professional education, maritime finance, and maritime arbitration, and the UK wants to be Hong Kong’s partner of choice.
The first overseas visit of new UK Chancellor Philip Hammond was to Hong Kong and China – underlining the priority he placed on our nations’ relationship when he was foreign secretary. As he has said, the UK-Hong Kong relationship “is innovative, forward looking and dynamic, with excellent prospects for the future, on which we will continue to build”.
This sentiment is truer now than ever and, amid changing global financial conditions, our two vibrant economies have much we can achieve in partnership – for the benefit of our own communities and others across the world.
Jeffrey Mountevans is Lord Mayor of the City of London