Why Hong Kong must focus on maritime insurance and Brexit
There are two areas where we could strengthen our international status as well as nurture business and job opportunities.
First, our maritime sector needs to expand. According to the report of the Financial Services Development Council released earlier this year, the global maritime insurance premium is worth more than HK$200 billion. However, a mere 0.6 per cent out of this total sum has been purchased in Hong Kong. Yet, 10 per cent of the world’s vessels are registered through the Hong Kong SAR shipping registry. This places us fourth in the world’s ship registration rankings, so there is plenty of room for expanding the maritime insurance business here.
Singapore has been aggressively competing for a regional leadership position in maritime insurance and Hong Kong has lagged behind. I have had discussions here with people in the insurance business, some from top international “protection and indemnity clubs”. They feel the monitoring authority has taken a very restrictive approach when handling cases from maritime insurance institutions. Too much red tape can prevent this sector from expanding in Hong Kong. The government has to be flexible and create an atmosphere where these companies can operate with the minimum of restrictions.
Second, Hong Kong should see Brexit as an opportunity. Britain will lose many of the favourable trade conditions it enjoyed as a member of the Single Market of the European Union. This could lead to British companies looking for new business opportunities outside Europe, such as Asia and, in particular, the China market. We should make a concerted effort in Hong Kong to welcome these British firms and encourage them to set up offices, including regional headquarters, in Hong Kong. This could create jobs and enhance Hong Kong’s reputation as an international finance centre.
The draft Brexit agreement is due to be tabled next spring for discussion by the EU Council. The government should pay attention to this and other key dates in the Brexit negotiations timetable. It should keep the public posted (where appropriate) about any actions it proposes in relation to Brexit.
We must be ready to compete with other cities and countries for the business opportunities that will arise from Brexit.
Holden Chow, legislative councillor, Democratic Alliance for the Betterment and Progress of Hong Kong