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Three Years of Tireless Endeavours

In less than two weeks, the current-term Government will mark its third year of office. Under the leadership of the Chief Executive, the team has worked with unity and resolve to overcome a range of challenges, while striving to foster economic growth, advance development, and improve people’s livelihood. From emerging from the COVID-19 pandemic to responding to unforeseen geopolitical shifts, Hong Kong’s economy has demonstrated exceptional resilience. Gross Domestic Product (GDP) has grown for nine consecutive quarters, surpassing the HK$3 trillion mark. Workers’ incomes have increased in real terms, while inflation has remained broadly stable.

Hong Kong has further reinforced and enhanced its status as an international financial centre. Over the past year, the stock market has regained an upward trajectory, with market trading volume increasing significantly. Since the beginning of this year, the average daily turnover has exceeded HK$240 billion. Hong Kong also ranks first globally in IPO fundraising so far this year. Beyond quantitative growth, qualitative improvements are evident: since the introduction of the “Chapter 18A” reform in 2018, the number of listed new economy and biotech companies has risen to approximately 370, accounting for 14% of all listed companies, over 27% of total market capitalisation and over 30% of market turnover. The “Chapter 18C” reform, introduced in 2023, together with the recent “technology enterprises channel” (TECH) and measures facilitating the return of China Concept Stocks listed in the US, highlight our commitment to keeping pace with changing circumstances and upholding the spirit of reform. These initiatives continuously enhance the attractiveness and competitiveness of the stock market and strengthen Hong Kong’s role as a platform for innovation and technology (I&T) financing.

Hong Kong’s financial centre status is also reflected across various sectors. For instance, in asset and wealth management, the number of registered funds reached 976 as of March 2025, with net capital inflows exceeding US$44 billion, an year-on-year increase of 285%. Within the next two to three years, Hong Kong is expected to become the world’s largest cross-boundary wealth management hub. For the insurance sector, the number of new long-term insurance policies issued in 2024 exceeded 1.08 million, with total premiums approaching HK$220 billion which showed an increases of more than 40% and 70%, respectively over 2022.

Despite global political and economic uncertainties, Hong Kong’s status as a free port, coupled with its robust legal system, makes it a trusted and stable financial safe harbour for international investors. As of April 2025, the total deposits in Hong Kong banks exceeded HK$18 trillion, representing a 19% increase compared to June 2022.

I&T has emerged as another key driver of Hong Kong’s economy. In 2023, the gross domestic expenditure on research and development increased by 10% year-on-year to around HK$33 billion, while the number of local startups reached a record high of 4,700. The two I&T flagships, namely the Hong Kong Science and Technology Parks Corporation and Cyberport, have nurtured and supported 22 listed companies and about 20 unicorns, collectively holding over 700 intellectual property assets. With increased investments in I&T, the accelerated development of the Northern Metropolis, and closer collaboration with cities in the Greater Bay Area, greater achievements are anticipated in the future.

The growth of both the financial and I&T sectors hinges on two critical factors: “quality enterprises” and “high-end talent”. These two elements are mutually reinforcing: quality enterprises attract high-calibre talent, and the gathering of talent, in turn, drives the growth of more quality enterprises, thereby creating a virtuous cycle. The current-term Government has taken proactive steps to attract both enterprises and talent. Since its establishment in late 2022, the Office for Attracting Strategic Enterprises has successfully attracted over 80 strategic enterprises that are engaging in cutting-edge technologies to Hong Kong. These enterprises are expected to invest around HK$50 billion and create more than 20,000 jobs in the coming years. From July 2022 to date, InvestHK has attracted and assisted a total of nearly 1,400 Mainland and overseas companies in setting up or expanding their operations in Hong Kong, which is expected to bring in over HK$100 billion in investments and nearly 20,000 jobs.

Various talent admission schemes have attracted over 210,000 individuals to Hong Kong since late 2022. The city’s world-class higher education system further enhances its global appeal. The “Study in Hong Kong” initiative has gained increasing recognition, helping attract talent worldwide. Over the past three academic years, the number of non-local students enrolled in Hong Kong’s tertiary institutions has steadily increased, reaching over 79,000 in the 2024/25 academic year, a 45% rise compared to 2022/23.

While Hong Kong’s economy continues to grow, certain sectors, such as retail and catering, face challenges due to changing consumption patterns of visitors and residents. Nonetheless, taking food and beverages services sector as an example, while total restaurant receipts fell slightly by 0.6% year-on-year in the first quarter of 2025, receipts of fast food shops recorded an 11th consecutive quarter of growth, at 1.9%. Receipts of non-Chinese restaurants and bars also saw increases of 2.4% and 6.5% respectively. Businesses are actively seeking new opportunities to adapt to shifting consumer preferences, such as introducing limited-edition menu offerings in specific locations for customers to try. Continuous innovation and creating new experiences are key to sustaining business growth.

The retail sector, which is also facing challenges, is proactively exploring new avenues as well, such as developing e-commerce locally and internationally. In August this year, the Hong Kong Trade Development Council will host the “Hong Kong Shopping Festival” to help local businesses leverage e-commerce platforms to develop the Mainland market, and enhance the awareness and visibility of consumer products and brands of Hong Kong enterprises.

Similarly, while the non-residential property market remains subdued it was noted that an experienced investor acquired an entire commercial building in Tin Hau for establishing a hub for the development of Web3 ecosystem, capitalising on Hong Kong’s latest developments in this sector. More and more Web3 enterprises are leasing office space in the city for launching their business, with continued demand anticipated.

Hong Kong’s economic fundamentals remain sound on the whole, with continuous growth in population since 2022 and significant year-on-year increases in visitor arrivals. In addition to pursuing economic growth and improving people’s livelihood, it is also essential to tell good stories of Hong Kong both at home and abroad. Tomorrow, I will lead a delegation comprising some 30 representatives of startups to attend the World Economic Forum Annual Meeting of the New Champions 2025 (also known as “Summer Davos”) in Tianjin. Our goal is to showcase Hong Kong’s research and development, as well as application examples of I&T, to international investors and leaders in the industry. Themed “Entrepreneurship for a New Era”, the meeting is expected to bring together around 1 700 participants from over 90 countries and regions to explore how entrepreneurship and innovation can drive economic growth in rapidly changing geopolitical and economic landscapes. I believe that through this event, Hong Kong’s startups, known for their vibrancy, flexibility and agility, will be able to engage with their global peers, forge new connections, and create new room for their own business development as well as for cross-sector and cross-regional collaboration.

Changes unseen in a century are accelerating. Despite great uncertainties in the external environment and rising tides of unilateralism and protectionism, Hong Kong has always been able to identify new opportunities, redefine its role and demonstrate its strengths in alignment with the development of our country. In face of challenges, we would make every effort to change; in face of opportunities, we would seize them with the best endeavour. On the occasion of the 28th anniversary of our return to the Motherland, with the staunch support of our country as well as the collective efforts of the government and the community, let us stand united and march forward with courage and confidence.

June 22, 2025