The biggest news in early June was that China officially announced the “Overall Plan for the Construction of Hainan Free Trade Port.” Since one of the goals of this plan is to make Hainan the hub of future international trade and finance, there is widespread doubt whether it means that the future Hainan will replace some of the functions and status of Hong Kong today.
In fact, Hainan, or any city in mainland China, cannot replace Hong Kong.
Hong Kong is the Asian financial center. Hong Kong is the most complete of all the currently operating international Anglo-American financial systems. More than 80% of European and American companies have entered China through Hong Kong. Registered investment companies have the most frequent operating capital. They buy stocks or bonds. Listed counter companies use Shanghai-Hong Kong Stock Connect funds to exchange funds between China, Hong Kong and Taiwan. Starting to sell shares, preparing to leave Hong Kong, another large part is likely to enter Singapore, or directly placed in overseas banks to wait for opportunities. It also belongs to the Anglo-American legal system. Singapore’s financial instruments are more diverse and have advantages.
In fact, without a pure market economy, an independent judicial system, or the special financial and tariff policies granted by the United States and Europe, no city in Hainan or the mainland can replace Hong Kong.
Journalist*
