Hong Kong’s evolution as an international finance centre  

Hong Kong’s third place ranking in the latest edition of the Global Financial Centres Index (GFCI), closely following New York and London, underscores its ongoing global significance – and change. As the Special Administrative Region (SAR) prepares its first five-year plan (5YP) for 2026-2030, Hong Kong’s policymaking is increasingly being shaped by shifts in financial activity as supply and demand for capital intermediated through the international finance centre (IFC) evolves.  

Located on the front doorstep of one of the world’s largest evolving sources of capital, issuers and wealth, Hong Kong is increasingly focused on mainland linked cross-border business. Rather than breaking with its international character, this reflects a commercial response to market demand that builds on and complements Hong Kong’s competitiveness and credibility as an international financial centre. It also leverages assets such as the co-location of mainland and Western financial institutions, deep access to global capital pools, and internationally credible legal and regulatory infrastructure.  

How does coordination and ongoing financial integration with the mainland interact with Hong Kong’s international role?   

In recent years, Hong Kong’s growth has increasingly been driven by its role in China’s financial opening, including through capital-market connectivity, offshore RMB liquidity and China-related wealth flows. These dynamics reflect Hong Kong’s function as a preferred offshore platform for cross-border capital flows, RMB intermediation and international listings. As Hong Kong becomes more closely integrated with mainland China, these linkages increasingly shape the commercial and regulatory context in which internationally active firms operate. This is especially so for firms with mainland-facing activities, where cross-border data, regulatory and jurisdictional requirements can become more complex.  

In terms of regulation, while some cross‑border coordination takes place, particularly on market connectivity issues, Hong Kong retains its own regulatory philosophy, supervisory approach, and rule‑making. Indeed, while Beijing reaffirmed its ban on stablecoins in February 2026, the HKMA granted its first stablecoin issuer licences on 10 April, aligning with the broader government agenda to develop Hong Kong as a global digital asset hub. Fintech and digital assets are key areas of opportunity for firms, and this differentiation is seen by financial services market participants as essential to Hong Kong’s continued evolution as an IFC. 

Hong Kong’s regulatory frameworks remain largely consistent with international standards. The Hong Kong Monetary Authority (HKMA) adopted Basel III capital reforms in January 2025 without delay, unlike some other jurisdictions, and implemented the Basel Committee’s prudential framework for crypto asset exposures on schedule. Hong Kong’s regulators also actively participate in global standard-setting processes, including leadership positions. CEO of the Securities and Futures Commission (SFC) Julia Leung is Chair of IOSCO’s Asia-Pacific Regional Committee. The SFC is also part of the Financial Stability Board (FSB) Standing Committee on Standards Implementation, and the HKMA co-chairs the Basel Committee on Banking Supervision’s (BCBS) Policy and Standards Group.  

For businesses and financial institutions, Hong Kong’s institutional features as an IFC, including a common-law legal framework, its regulatory institutions, and cross-border capital mobility, remain anchored in internationally recognised legal and regulatory standards. 

How is Hong Kong’s mainland China linked role shaping opportunities across global finance? 

At the same time, Hong Kong plays an important role as the most efficient platform for mainland China-related financial activity, and as a conduit between the mainland and global capital markets. We can expect regulatory developments to continue to prioritise mechanisms that enhance Hong Kong’s position as a ‘super connector’ between mainland China and global capital markets.  

Opportunities will continue to grow in:  

• Cross-border capital markets activity and RMB liquidity. The HKMA has pledged to enhance existing Connect schemes, as well as double the RMB Business Facility quota to RMB 200 billion to strengthen Hong Kong’s offshore RMB‑liquidity capabilities. Meanwhile, Hong Kong is now the leading international venue for China-related IPOs, where mainland banks provide issuer support and international firms offer global distribution. Similarly, the PBOC has signalled deeper financial‑market connectivity by advancing the offshore RMB market and preparing for RMB‑denominated government bond futures, further embedding Hong Kong in China’s gradual financial opening. 

• Wealth and asset management. As Hong Kong continues to entrench itself as the main offshore platform for mainland Chinese and regional wealth, while also retaining its appeal for ultra-high net worth individuals, asset managers and private banks from around the world, there will be opportunities for Western intermediaries in advisory services, asset management, risk hedging, and private banking. This is especially so in cases where global investment expertise is combined with Hong Kong’s role as a controlled gateway to mainland Chinese capital markets. 

At the same time, Hong Kong’s deepening integration with the mainland does reshape the context in which internationally active firms operate: 

• Perception and practice. To some outside of Hong Kong, geopolitical and political sensitivities may influence perceptions about operating in the city. In practice, Hong Kong’s commercial legal framework remains intact, while its deepening interconnectivity with the mainland can, in some areas, require additional operational and compliance effort; for example, in managing data flows between mainland-linked and international activities in line with different regulatory requirements. 

• Talent. Talent dynamics in Hong Kong shifted in the post-Covid period, reflecting changes in international mobility following the earlier impact of restrictions during the pandemic, changing external perceptions of Hong Kong during this period, as well as the shifting mix of financial services activity, with banks and asset managers increasingly focused on mainland Chinese issuers, clients and investment opportunities. Talent inflows increasingly come from mainland China through mechanisms such as the Top Talent Pass Scheme (TTPS), with 95% of visa holders under the scheme from the mainland. That said, many international firms report continued success in recruiting and retaining regional talent in Hong Kong and continue to rank the IFC as the most international talent pools in the region. 

• Geopolitical dimension. Hong Kong operates amid continued US-China competition. In a downside scenario of major escalation – including sanctions, export controls or capital flow restrictions – the reality of Hong Kong’s gateway role may increase exposure to geopolitically driven risks. In this environment, operational resilience, contingency planning, liquidity backstops, and payment and settlement continuity become increasingly important for internationally active firms operating through the city. At the same time, amid heightened volatility in parts of the Middle East, some market commentary has pointed to Hong Kong as a relatively stable venue for capital and wealth, alluded to by Chief Executive John Lee recently. While still early, such interest points to the potential for some additional capital inflows into Hong Kong’s wealth and asset management ecosystem. 

Combining its roles as a platform for China-focused financial activity and as an international financial centre, Hong Kong continues to present a distinct operating environment for internationally active firms. Opportunities remain in capital markets, wealth and financial cross-border infrastructure. For firms with sufficient scale and sophistication, Hong Kong offers the lowest-friction access to mainland capital markets. As market conditions evolve, firms able to adapt their operating models and deploy global capabilities remain well-positioned to benefit from Hong Kong’s role as China’s primary interface for international finance. 

Three key strategic takeaways for businesses 

1. Hong Kong’s evolving role within regional and global finance. Hong Kong’s role is increasingly characterised by a more specialised and systemically important interface with mainland China, reflecting a re-weighting of activity rather than a wholesale shift, as its China-facing functions become more prominent alongside continued international and regional roles. Operating in Hong Kong means navigating this nuance and duality. 

2. Navigating today’s geopolitical operating context. Hong Kong operates at the intersection of major geopolitical and geoeconomic dynamics, including US-China competition. For firms today, this places a premium on institutional understanding of geopolitical sensitivities, their potential operational implications, and integrating this into operational and strategic planning.  

3. New opportunities are arising. Among Hong Kong’s key strengths is its ability to perform financial functions that are structurally unavailable on the mainland, supporting its continued role as a major offshore platform alongside wider international and regional functions. For internationally active firms, this sustains opportunities to participate in areas such as capital-market connectivity through the Connect schemes, offshore RMB activity, wealth and private-markets growth, green and tokenised finance, and Greater Bay Area cross-border integration - domains where international expertise, market infrastructure and global connectivity matter. 
   

This blog was written by  Partner Matthew Chan, Director Lisa Ross, Consultant Oriane Voets, and Consultant Konrad Lee. Matthew, based in Hong Kong, is a leader in public policy and regulatory affairs with deep experience and practical expertise in the APAC region, following previous senior roles at J.P Morgan and ASIFMA in Hong Kong. Lisa, based in Singapore, is a seasoned politics, policy, and regulatory affairs professional and leader, with over 14 years of experience across the financial services industry and legal academia. Oriane, based in Hong Kong, advises clients on policy, political, and regulatory issues across the APAC region and has previous experience interning at public affairs consultancy APCO Worldwide and the European Chamber of Commerce in Hong Kong. Konrad, based in Hong Kong, advises clients on policy, political, and regulatory issues across the APAC region, and previously worked at the Asia Society Policy Institute in New York with a focus on US-China relations. 

In Asia-Pacific, Flint Global is a strategic advisory firm helping businesses and investors navigate political, regulatory, and geopolitical complexity across 14+ jurisdictions. We combine on-the-ground knowledge, regional expertise, and global insight to help clients manage risk, engage effectively with governments, and make informed commercial decisions that create competitive advantage. 

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