AIIB membership 'to boost HK's stature'
Updated: 2015-03-27 07:38
By Sophie He in Hong Kong(China Daily)
Economists upbeat on the city's world financial status if it joins mainland-led $50b institution
Hong Kong stands to gain immensely by joining the Chinese mainland-led Asian Infrastructure Investment Bank (AIIB), with its status as an international finance center to be given a big lift, economists and local business leaders say.
A Hong Kong Chinese-language newspaper reported on Thursday that the SAR government has begun talks with the central government on membership of the $50-billion bank, which is expected to be based in Beijing.
Economists and scholars are convinced that AIIB participation would further strengthen Hong Kong's position as a global financial hub as it would allow the city's banks to join fund-raising activities organized by other member states.
Hong Kong's MTR Corp, which is well known for its expertise and efficiency in operating one of the world's busiest subway systems, and the operators of the city's container port, which ranks fourth globally in throughput, could also leverage on AIIB membership by bidding for management contracts and related jobs in overseas projects funded by the AIIB.
"If Hong Kong joins the AIIB, the institution can provide a full range of financial services to AIIB members, helping them in issuing bonds and raising funds in Hong Kong and providing project evaluation services," said Chong Tai-leung, a professor at the Chinese University of Hong Kong's Department of Economics.
"The AIIB itself is an international platform, and if Hong Kong can play a role in it, it will certainly be able to enhance its international stature," he said.
Chong also believed that if Hong Kong joins the AIIB, it's possible that the institution's headquarters would be located in the SAR.
"As Hong Kong is a very important financial center in Asia, and the AIIB is initiated by the central government, it's possible that the AIIB headquarters will be located in the city, although Hong Kong will have to compete with Beijing, Shanghai and Singapore.
"I believe Hong Kong is a better choice as it's more open, and capital can flow freely in and out of the city. It would also be more convenient for AIIB members," he added.
Paul Tang Sai-on, chief economist at the Bank of East Asia, told China Daily that Hong Kong's financial services industry has already gained extensive experience in the US and European markets. But, it needs to get more involved in Asian financial businesses "as it's very obvious that the central government attaches great importance to opportunities in the region", he said.
Tang said that by joining the AIIB, the SAR would be able to gain "precious experience" in infrastructure investments in Asia, especially in ASEAN countries, and "our construction and transportation companies will have a better chance of exporting their technologies needed by various infrastructure projects in the region", he said.
The AIIB, which is scheduled to begin operations by the end of this year, has so far attracted some 28 countries in signing up as founding members, and membership is expected to grow to 35 before the March 31 deadline, with capitalization likely to double to $100 billion.
Southeast Asian countries, such as Indonesia, are actively seeking a leading position in the Asian Infrastructure Investment Bank to grab the chance to fly with the tail wind of international cooperation. Dimas Ardian / Bloomberg
(China Daily 03/27/2015 page10)