Hong Kong Legislative Councilor Li Weihong: Suggests that the Hong Kong government should discuss with the mainland to deepen mutual connectivity and explore "new stock connect", "futures connect", etc.

The Hong Kong government's financial budget for the fiscal year 2026-2027 will be announced on February 25th. Hong Kong Legislative Council member of the financial services sector, Li Wai-hung, urged the government and the Hong Kong stock exchange to review the clearing system and unify the margin arrangements for securities, futures, and stock options across products. He suggested discussing deepening mutual market access with the Mainland, exploring "new stock connect", "futures connect", "commodity connect", and "license connect". Additionally, he proposed that the Hong Kong stock exchange implement 23-hour trading, diversify commodity futures products, enhance promotion of the futures industry, and introduce incentive plans to stimulate futures trading. Li Wai-hung also recommended that the government continue to actively assist and attract small and medium-sized enterprises from both domestic and overseas to list in Hong Kong. He suggested further reviewing the positioning of GEM and the main board in the market, reshaping the GEM brand, and providing effective solutions. Through new stock listings, more small and medium-sized underwriters, sponsors, securities firms, and service providers for small and medium-sized accounting and legal institutions can be stimulated. He also recommended loosening rules on mergers and acquisitions or reverse takeovers (RTO) of listed companies. As the government has already discontinued the technology voucher scheme, to assist the industry in upgrading and transforming, he proposed studying the establishment of a special fund to support the industry in meeting new regulatory requirements, such as the paperless securities market system and other system upgrade requirements, to reduce compliance costs. There should also be a comprehensive review of the various fees charged by the Securities and Futures Commission and the Hong Kong Stock Exchange to reduce operating costs for the industry. He mentioned that although the government has stated its intention not to reduce the stamp duty on stocks, the industry is calling for a reconsideration of this, for example, a unilateral levy of 0.05%, or consideration of implementing a tiered decreasing stamp duty. It may also be worth considering exempting the stock stamp duty on dual currency counters to stimulate trading in dual currency counters and support the internationalization of the renminbi. Regarding the development of the gold market, Li Wai-hung suggested the optimization of the current traditional and innovative product legal and regulatory framework, such as the limitation of non-bank institutions in the Paper Gold Plan, and actively promoting tokenization of gold assets. He urged the Hong Kong Monetary Authority to encourage banks to adopt a friendly attitude towards operators of precious metals and digital assets, especially not categorizing general business as high-risk for money laundering too easily.