Illustration: Chen Xia/GT
Amid a complex and volatile global economic landscape, Hong Kong, with its unique advantages, has emerged as an indispensable financing powerhouse for Chinese mainland companies seeking international expansion.
As more and more A-share companies pursue listings on the Hong Kong stock market, so-called "A+H" listings account for more than two-thirds of overall listing volumes in Hong Kong this year, a surge from just over 2 percent in 2023, Bloomberg reported on Wednesday.
Moreover, in the first half of this year, the IPO market in Hong Kong grew strongly, ranking first in the world in terms of fundraising, Hong Kong's Secretary for Financial Services and the Treasury Christopher Hui Ching-yu said on Tuesday. The number of IPOs in Hong Kong in the first seven months of this year reached 53, raising HK$127 billion ($16.18 billion), surpassing the annual fundraising totals for each of the past three years.
These figures underscore a clear trend: the remarkable increase in the financing capacity of Chinese mainland enterprises in Hong Kong, which is driven by the growing strength of Chinese enterprises themselves, the continuous release of the institutional competitiveness of Hong Kong's capital market, and the solid foundation of China's real economy.
The appeal of Hong Kong lies first in its mature capital market with clear and transparent listing rules and strict regulatory norms, which provide a stable and internationalized environment for enterprises to list and raise funds.
Meanwhile, amid rising global uncertainty, overseas investors are increasingly inclined to diversify their asset allocation, with a continuous increase in the proportion of investments in Chinese assets. As a "super-connector" linking the mainland and the international market, Hong Kong has naturally become the preferred destination for overseas investors to enter the Chinese market and allocate yuan assets.
According to the latest Asset and Wealth Management Activities Survey released by the Securities and Futures Commission, total assets under management in Hong Kong grew by 13 percent year-on-year, reaching HK$35 trillion ($4.46 trillion) as of the end of 2024, Hong Kong Monetary Authority Chief Executive Eddie Yue wrote in an online post in early August.
Beyond stability, Hong Kong has embraced financial innovation. Reforms such as streamlined listing rules for tech firms and advancements in fintech and green finance have expanded financing avenues for high-growth companies, providing diversified financing channels for enterprises of different types and at different stages of development.
From the perspective of mainland enterprises, their financing appeal is ultimately rooted in their own competitive strengths. After decades of development, China has become a global manufacturing powerhouse. A growing number of Chinese enterprises have prospered through market competition, boasting leading technologies, high-quality products, and significant market shares. For example, take new-energy and biotech enterprises that have listed in Hong Kong in recent years. Their innovation-driven and predictable long-term growth story makes international capital more willing to participate in this high-growth track through the Hong Kong market.
Fundamentally speaking, their financing appeal stems not only from the institutional advantages of the Hong Kong market but also from Chinese manufacturing's position in the global supply chain. The mainland's complete industrial chain and huge consumer market endow enterprises with stable cash flow and sustainable growth potential, making them worthy of long-term allocation in the eyes of international capital. It is the resilience of this real economy that makes global investors willing to share in the mainland's economic development dividends through the hub of Hong Kong.
In addition, the uncertainties faced by Chinese mainland enterprises listed in the US have further highlighted Hong Kong's position as a preferred destination for overseas listings. In recent years, Chinese mainland enterprises listed in the US have faced more complex compliance requirements and may also be affected by geopolitical factors. This uncertainty has made many high-quality mainland enterprises re-examine their choices for overseas listings and turn their attention more to Hong Kong. This trend has further promoted the prosperity of Hong Kong's IPO market.
With the continuous development of the Chinese mainland economy and the continuous optimization of the Hong Kong market, it is believed that Hong Kong will continue to play an important role in the global financial arena, providing more powerful support for mainland enterprises to go global.
