In depth review of the 9th Hong Kong Fintech Week's "Political Perspective" topic: The Hong Kong government is making every effort to create a favorable environment for fintech companies

The following is a detailed report on the topic of "Political Perspective".

Article author: Echo, MetaEra

Article source: MetaEra

The 9th Hong Kong Fintech Week 2024 will be held from October 28th to November 1st at the Asia International Expo. The flagship event with the theme of "Lighting up the New Path of Financial Technology" stands at the forefront of global financial technology development, in line with Hong Kong's vision. It focuses on the latest developments in the financial sector, helping participants gain in-depth insights into their industries and fields, and establish connections with industry leaders to explore cutting-edge opportunities in areas such as Web3, artificial intelligence, insurance technology, etc. The goal is to lead the future of financial services and other fields.

As an official media partner, MetaEra provides comprehensive support for the coverage of this event. Here, we bring you a series of special reviews and look forward to providing you with more detailed and in-depth vertical content. The following is a detailed report on the topic of "Political Perspective".

The key word we want to emphasize is' responsibility '

Guest: Christopher Hui, Secretary for Financial Services and the Treasury of the Hong Kong Government

Christopher Hui elaborated on a new policy stance in his keynote speech, advocating for the "responsible application of artificial intelligence" in financial markets, and emphasized that key driving factors must exist to promote the adoption and full integration of artificial intelligence and Web 3.0 into mainstream finance.

According to the policy statement of the Hong Kong Special Administrative Region Government, the government has identified three key attributes for the application of artificial intelligence (AI) in the financial services sector: data-driven, double edged sword, and dynamic. The government will adopt a dual track approach, promoting the development of AI applications in the financial services sector while addressing potential challenges such as cybersecurity, data privacy, and intellectual property protection. In addition, the usage rate of General Artificial Intelligence (GenAI) in Hong Kong's financial sector has reached 38%, far higher than the global average of 26%. The government is preparing to support the further application of AI by encouraging financial institutions to seize opportunities for responsible use of AI. At the same time, the government is actively addressing the long-term challenges faced by AI, including cybersecurity, data privacy, and intellectual property protection.

Christopher Hui also emphasized that the application of artificial intelligence in the financial sector is a double-edged sword, with both enormous potential and hidden risks. In order to reduce risks in AI applications, the Hong Kong government is focusing on data protection, effective governance, transparency and protection, and operational resilience. He mentioned that the government will collaborate with regulatory agencies and industry stakeholders to provide a clear regulatory framework to help the industry seize opportunities and responsibly adopt AI. This includes ensuring data protection and privacy rights, strengthening governance and transparency, and ensuring operational resilience and business continuity.

Christopher Hui subsequently announced that a new law will be implemented by the end of this year to expand Hong Kong's tax incentives to include virtual assets. He also announced further regulation of stablecoins and plans to establish a licensing system for virtual asset custody service providers next year.

He pointed out that Hong Kong is also in a good position to expand the development of AI applications in the global market. We are part of the mainland, and over 60% of the world's AI patents can be found here. At the same time, we uniquely connect the East and the West, and our global positioning allows us to connect with other regions of the world. In terms of AI applications, we are at the forefront of both the East and the West

Ultimately, we envision a borderless fintech ecosystem where innovation will drive business development

Guest: Eddie Yue, Chief Executive Officer of the Hong Kong Monetary Authority (HKMA)

In his keynote speech, Eddie Yue outlined a blueprint for the future of fintech, evaluated the current situation, and speculated on the future. He pointed out that a vibrant fintech ecosystem cannot be achieved overnight, as technology is constantly creating change. He mentioned that although innovation may feel lost and uncomfortable, it is a special opportunity to reflect on how it serves the public interest. He added that innovation itself is not an end in itself, but a means, as it enhances our daily life experience.

Eddie emphasized the significant changes in the past few years. One example is using local wallets like PayMe for cross-border payments to facilitate transactions elsewhere. This makes payments in Chinese Mainland and other parts of Asia as easy as in Hong Kong. He pointed out that other examples of Commercial Data Interchange between governments and businesses provide unique growth opportunities for businesses and their customers.

Finally, Eddie concluded that allowing banks to adopt artificial intelligence while setting appropriate regulatory measures is the right approach, and he pointed out that the Hong Kong Monetary Authority (HKMA) is committed to promoting responsible applications of artificial intelligence. He mentioned that the GenAI sandbox of HKMA and Cyberport is an example of this commitment, and HKMA will adopt an interactive and iterative approach to carefully examine the results of the sandbox and provide feedback to participating banks.

The future lies in a regulated market that strikes a balance between development and investor protection

Guest: Eric Yip, Executive Director of the Intermediary Department of the Securities and Futures Commission

Virtual assets are now at the forefront of every financial regulatory agency's agenda, "Eric Yip pointed out in his keynote speech. He emphasized the significant progress made and challenges faced in regulating virtual assets in Hong Kong at present. The three key factors driving market development are: first, the growing pool of talented individuals; second, the enormous economic potential and market opportunities; and third, the rise of the younger generation of cryptocurrency investors.

At SFC, we firmly believe that the future lies in a regulated market that strikes a balance between development and investor protection, "Eric said. He added that there are currently three SFC licensed virtual asset trading platforms (VATPs) in Hong Kong, and 14 applications are being processed. Investors can soon expect more licensed platforms that comply with international anti money laundering and cybersecurity standards. In addition to SFC's efforts, the continued development of a fully regulated market will require extensive global cooperation and education to prevent fraud and protect investors. He pointed out that Hong Kong "has already had a good start, witnessing the largest year-on-year increase in asset trading volume." This will put the city at the forefront of global virtual asset regulation and prepare to attract more local and international participants to join the licensing system, which is good for all investors, he concluded.

In order to open up new paths in the field of financial technology, we need to promote cooperation in the development of financial technology within the Guangdong Hong Kong Macao Greater Bay Area

Guest: Fu Xiaochu, Secretary of the Party Group and Director of the Guangzhou Local Financial Supervision and Administration Bureau

Mr. Fu Xiaochu outlined the latest developments in financial technology in Guangzhou and emphasized the importance of innovation supported by supportive policies. He said, 'We believe that technology helps people drive the development of industries,' highlighting Guangzhou's determination to promote digitalization in the financial sector.

Mr. Fu elaborated on the goal of Guangzhou becoming a model city for digital transformation, which is reflected in the 14th Five Year Plan and aims to improve the digitalization level of the entire region. Guangzhou has launched a series of national pilot projects to cultivate a thriving fintech ecosystem, "he pointed out, including fintech innovation projects, currency digitization, and national blockchain projects. These efforts demonstrate the city's determination to strengthen its digital capabilities in the financial sector.

When discussing the challenges faced by fintech, Mr. Fu pointed out that "a balance between cybersecurity, data privacy, and innovation and regulation is crucial." To address these risks, Guangzhou has established China's first professional financial risk monitoring center to strengthen security in the fintech field.

Mr. Fu finally called for deeper cooperation within the Guangdong Hong Kong Macao Greater Bay Area, utilizing the advantages of each city and emphasizing the importance of developing talent through training and certification programs.

If you ultimately want to go public, Hong Kong is the place to do it

Guest: Fu Zhongsen, Director General of Investment Promotion Department of the Hong Kong Special Administrative Region Government

Ms. Fu Zhongsen delivered a keynote speech on the first day of Hong Kong Fintech Week, emphasizing the Hong Kong Special Administrative Region government's commitment to financial innovation, particularly the eight key points proposed in the latest policy speech. These include enhancing offshore RMB liquidity through diversified channels; Strengthening Hong Kong's position as an international risk management center; And attract more capital to manage in Hong Kong.

Ms. Fu subsequently shared the government's ongoing efforts to deepen Hong Kong's overseas network in Southeast Asia and the Middle East, as well as the role played by large-scale events such as FinTech Week in promoting cooperation.

The Hong Kong Monetary Authority and the People's Bank of China are also promoting real-time, cross-border and micro payment for mainland and Hong Kong residents. Ms. Fu also highlighted the Hong Kong Monetary Authority's plan to launch the Sustainable Financial Action Agenda. This, combined with the upcoming International Sustainable Development Standards Board (ISSB) standard roadmap on climate reporting by the Financial Services and the Treasury Bureau, will enhance Hong Kong's green finance ecosystem and its fintech innovation.

The Hong Kong Monetary Authority will continue to play a role in reducing activation barriers for fintech solutions that have the potential to reshape the regional and even global financial landscape in the long run

Guest: Yu Weiwen, Vice President of the Hong Kong Monetary Authority

In his keynote speech, Mr. Yu Weiwen emphasized that the Hong Kong Monetary Authority is committed to promoting the development of financial technology in the Guangdong Hong Kong Macao Greater Bay Area and playing a more catalytic role in emerging technologies. These new innovations will not only help meet new consumer demands, but will also be crucial in financial institutions' efforts to manage the risks brought by technological disruption.

To ensure that Hong Kong truly becomes a leading fintech center, the Hong Kong Monetary Authority plans to focus on three main areas: helping fintech companies achieve globalization within five years or less, promoting regional adoption of fintech innovation in the Guangdong Hong Kong Macao Greater Bay Area, and cultivating a rich fintech ecosystem in the city through increased regional and international cooperation.

At present, the Hong Kong Monetary Authority is working hard to address the three main challenges faced by these plans: regulatory uncertainty, data accessibility, and fintech awareness. Initiatives such as generative artificial intelligence sandboxes, Shenzhen Hong Kong cross-border data verification platforms, and fintech connectivity platforms can help address these issues by providing a secure space for testing AI use cases and enhancing information flow between fintech solution providers and financial institutions.

The Hong Kong Monetary Authority is eager to see Hong Kong flourish as a global fintech hub, becoming a launch pad for fintech startups and small and medium-sized enterprises to go global.

Group Discussion: Financial Technology in Hong Kong and the Middle East: New Opportunities

participant:

Joseph Chan, Deputy Secretary General for Financial Services and the Treasury of the Hong Kong Special Administrative Region Government

Mohammed AlSarrani, Deputy Director General of the Financial Industry Development Programme (FSDP)

Host: Olivia Kinghorst, international host, former CNN and Forbes reporter

This is the beginning of a very successful economic journey between Hong Kong and Saudi Arabia, as well as between Asia and the Middle East

In a panel discussion on the theme of FinTech in Hong Kong and the Middle East: New Opportunities, Joseph Chan and Mohammed AlSarrani shared the benefits of increasing cooperation between the two markets. After the disruptions caused by the COVID-19 pandemic, "now is the right time to catch up and jointly explore the huge opportunities for trade and investment between the two regions," he commented. In particular, Joseph Chan praised Saudi Arabia's position as a leading economy in the Middle East and a significant source of foreign investment globally, as well as its clear development plan and diversified financial sector.

In terms of cooperation opportunities, Joseph Chan shared his observations on Hong Kong's financial and technological strength. Hong Kong's expertise in green finance, fintech, Web3, and family offices provides abundant opportunities for cooperation between Hong Kong and the Middle East.

On the other hand, AlSarrani provided his views on Hong Kong's advantages. When Vision 2030 was announced, we aimed to identify an outstanding financial center, not based on its scale, but on its open business and adaptability to the overall ecosystem. Hong Kong definitely stood out. Therefore, it was natural for us to sign a memorandum of understanding with our friends from the Financial Services Development Committee. He also shared that Saudi Arabia's location at the center of three continents and economic transformation provides unique investment opportunities for Hong Kong companies and financial institutions.

We spare no effort to create a favorable environment for fintech companies

Guest: Jimmy Chang, Deputy Director of the Office of Attracting Strategic Enterprises of the Hong Kong Special Administrative Region Government

In Jimmy Chang's speech, he provided a detailed introduction to the Office of Attracting Strategic Enterprises (OASES) and shared its important mission of attracting high potential strategic enterprises in Hong Kong to the audience present. Since its establishment in 2022, OASES has partnered with multiple government departments and has met with over 480 companies, of which over 100 have chosen to join OASES, committing to invest up to HKD 520 billion and creating over 15000 new job opportunities in Hong Kong.

OASES is committed to attracting enterprises in the fields of financial technology, artificial intelligence and data science, life and health technology, as well as advanced manufacturing and new energy technology. When it comes to artificial intelligence, Mr. Zhang pointed out that investors and market participants have already realized the enormous opportunities brought by artificial intelligence. He emphasized, "OASES is committed to working closely with regulatory agencies, artificial intelligence companies, and other stakeholders to promote responsible and sustainable applications of artificial intelligence in various industries

Mr. Zhang also emphasized Hong Kong's commitment to cultivating innovative spirit and consolidating its key role in the dynamic fintech field. He mentioned some of the latest measures, including the stablecoin sandbox arrangement and the Hong Kong Monetary Authority's new wholesale central bank digital currency project Ensemble, aimed at supporting the development of tokenization.

OASES is fully prepared and looks forward to collaborating with global strategic enterprises to provide comprehensive, one-stop, and customized services for companies interested in establishing or expanding their business in Hong Kong, "said Mr. Zhang.

Coordinate supervision and governance across jurisdictions

Group discussion participants: (from left to right)

Matthew White, CEO of VARA

Sabino Fornies, EU Ambassador Counsellor

Host: Sarah Wong, Asian journalist, Asian legal business, Thomson Reuters

Regulatory agencies bear the responsibility of ensuring that small participants in the economy are not marginalized in the wave of innovation

In the thematic discussion on "Cross jurisdictional Coordination of Regulation and Governance" with Michael White, Sabino Fornies, and Sarah Wong, guests delved into how different jurisdictions can find a balance between innovation and regulation in the field of virtual assets, with a particular focus on the case studies of Dubai and the European Union.

The attending experts unanimously agree that when formulating regulatory policies that comply with international compliance standards, regulatory agencies need to ensure the development space of small participants in the field of innovation. Some markets, such as the European Union, emphasize core principles such as protecting consumers, maintaining financial stability, promoting fair competition, safeguarding market integrity, and protecting data privacy when finalizing regulatory rules. The implementation of these principles relies on consultation with various stakeholders and ensuring that the proposed regulatory regulations are both reasonable and not overly stringent. Given the cross-border nature of virtual assets, there is an increasing demand for unified regulatory methods across jurisdictions.

Michael White and Sabino Fornies both emphasized the importance of international cooperation to prevent regulatory arbitrage and ensure smooth cross-border business operations. They further pointed out that in order to effectively regulate emerging technologies, regulatory agencies must have a deep understanding of the business models and potential risks associated with virtual assets. Industry dialogue, effective communication, and trust building among regulatory agencies are crucial for building an effective regulatory framework. Speakers emphasized that regulatory agencies should actively learn from the experiences of other markets - learning how to address implementation challenges and ethical issues in complex new financial fields such as virtual assets.

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