The region’s chief executive Carrie Lam outlined plans in a speech at the Asian Financial Forum

At the 15th Asian Financial Forum, Hong Kong chief executive Carrie Lam said there were firm plans to strengthen the SAR’s position as a centre for international risk management and insurance with “strong support” from the Central Government. This includes making it easier to set up and manage captive insurers in the territory.

“To enhance our competitiveness, we have implemented a variety of measures over the past year,” she told delegates from across the region via video link. “They include offering profits-tax concessions for select insurance businesses and expanding the scope of insurable risks for captive insurers based in Hong Kong.”

“We have also established a dedicated regulatory regime for insurance-linked securities (ILS) and launched a subsidy scheme for their issuance in Hong Kong.”

“These measures, I’m pleased to say, enabled the issuance, in October last year, of our first insurance-linked security. And that has spurred Hong Kong’s emergence as a centre for insurance-linked securities.”

Hong Kong has long been in competition with rival financial centre Singapore to gain recognition as the leading regional hub for insurance and reinsurance.

As Hong Kong seeks to put the last few years’ of political unrest and pandemic disruption behind it, the SAR is keen to demonstrate it can retain and build on its existing strengths as a financial centre.

It will set out to achieve this by leveraging connections with the Greater Bay Area and continuing to emphasise the principle of “One Country, Two Systems”, established during the 1997 handover, explained Lam.

“Hong Kong’s financial system is characterised by our sound regulatory and risk-management regime,” she said. It is also underpinned by the principle of ’One Country, Two Systems’ and with it, institutional strengths such as the rule of law, an independent judiciary, highly open and internationalised markets, a deep liquidity pool, and the free flow of people, information and capital.”

”These strengths which are embodied in the Basic Law have not only sustained during the challenging period in Hong Kong over the past two and a half years, but have been fortified by the resolute actions of the Central Authorities to enact and implement the National Security Law in June 2020 and improve our electoral system last year to ensure ’patriots administering Hong Kong’.”