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Chief Executive CY Leung
At the Bo'ao Forum in April, Premier Li Keqiang announced that "conditions are being actively created to establish a trading mechanism between the Shanghai and Hong Kong stock markets".
After months of detailed preparation by the Central Authorities of the country and the Hong Kong SAR Government, and all other relevant parties, we are about to witness the launch of the Shanghai-Hong Kong Stock Connect.
This is a scheme of historic significance to both Hong Kong and Mainland stock markets. With the launch of Stock Connect, institutional and retail investors in Hong Kong and from overseas will be able to invest directly in eligible Mainland A-shares while eligible Mainland investors can invest in eligible Hong Kong stocks.
Hong Kong banks have also implemented a new arrangement with effect from today whereby the renminbi daily conversion limit for Hong Kong residents has been lifted to facilitate Hong Kong residents in participating in Stock Connect and other renminbi financial transactions.
The new mutual market access has special significance in two respects:
* The scheme creates synergy for the two stock markets by expanding the sources of investment and boosting their competitiveness;
* Stock Connect facilitates the gradual opening of the Mainland's capital account and the internationalisation of the renminbi as an investment currency for global investors, thereby reinforcing Hong Kong's position as an international financial centre and a premier offshore renminbi hub.
Super-connector role realised
Hong Kong has the combined advantages of ‘one country’ and ‘two systems’. We also offer the unique feature of being part of China and yet outside the Mainland. We are therefore the super-connector between the rest of the country and the rest of the world.
Stock Connect aligns the Mainland market with the international markets and is the upgraded version of Hong Kong as the super-connector to and from China.
The National 12th Five-Year Plan undertakes to support Hong Kong to "consolidate and enhance its status as an international financial, trade and transportation centre".
Stock Connect is the latest illustration of such support. The Hong Kong SAR Government will now work with the Central Government on the next five-year plan, to map out further enhancements of Hong Kong as an international financial centre.
To this end, the HKSAR Government has also established the Financial Services Development Council.
I offer my sincere gratitude to all those who have put in so much effort within so short a space of time to finalise the preparation of this launch.
Once Stock Connect starts, there will be close monitoring by the Government, regulators and exchanges. It is necessary to ensure that the scheme operates smoothly to meet the market needs and consider what room there is to improve the mechanism and expand the scheme in an orderly manner.
Chief Executive CY Leung gave these remarks at the launch ceremony of the Shanghai-Hong Kong Stock Connect at the Hong Kong Exchanges & Clearing Limited.
