2024 New Year Message from Chairman Mofiz Chan
January 1, 2024
Dear Members and Friends,
Warm greetings to you all! As we transition from one year to the next, I extend my heartfelt wishes to our dedicated members and supporters of the Hong Kong Securities and Futures Professionals Association. May the coming year bless you with professional success, robust health, and personal joy for you and your loved ones.
2023 was a year marked by formidable challenges. As normalcy resumed post-pandemic, Hong Kong's economic resurgence fell short of expectations. High interest rates and geopolitical tensions weighed heavily on regional economies. The Hong Kong stock market faced significant hurdles, with the Hang Seng Index recording a four-year streak of declines. The average daily turnover in the stock market dropped by over 15% compared to 2022. The IPO market hit a two-decade low, with new listings decreasing by 19%, and fundraising dipping to its lowest since the SARS outbreak in 2003. Consequently, Hong Kong slipped from the top five global IPO markets, trailing even behind India. Amid this economic downturn, the local securities industry encountered intense pressure, leading to closures and layoffs. According to the Hong Kong Stock Exchange, 32 brokerage firms ceased operations in 2023, following 49 closures in 2022, thus challenging Hong Kong's status as an international financial hub.
In the face of adversity, we remain steadfast in our belief that challenges bolster both the industry and individuals. Our members have shown unmatched professionalism and skill, making substantial contributions to the industry's growth in this competitive landscape. The Association has faithfully supported its members and the industry, achieving considerable progress in key areas through collective effort.
On the policy front, the Association has been actively involved in industry discussions, making significant strides in areas crucial to industry needs and interests. In December 2022, we submitted feedback to the Financial Services and the Treasury Bureau concerning the "Risk Management Guidelines for Licensed Persons Dealing in Futures Contracts" consultation paper by the Securities and Futures Commission. Following a consultation exchange in March 2023, several of our suggestions were incorporated into revisions by the Commission, including adjustments to commodity futures regulations and margin requirements, enhancing risk management standards and offering greater flexibility for licensed individuals. The Association is pleased with these outcomes and will closely oversee the implementation of these new guidelines to aid members in adapting smoothly.
Furthermore, the Association's advocacy for reducing stock stamp duty led to notable adjustments in the 2023 Policy Address. High transaction costs in recent years have deterred investor participation, drastically reducing local stock market activity and pressuring local brokers. While the duty adjustment was modest, the Association maintains that the rate remains higher than in other global financial centers, still insufficient to attract international capital to Hong Kong. We will continue to propose measures to boost the market's competitiveness and appeal.
Aiming to address concerns regarding market operations during severe weather, the Association has voiced its stance on the " Trading continues during severe weather conditions " policy, slated for implementation as early as this summer. We thank Legislative Council member Mr. Kwok Wai-keung Aaron for supporting our position. The Association will persist in advocating for policies that safeguard broker operations and minimize burdens under adverse conditions.
International collaboration remains a priority. In August 2023, I visited Malaysia to explore Islamic finance opportunities, reflecting our commitment to fostering global ties. The Association will launch Islamic finance training for Hong Kong professionals in January 2024, equipping those keen to enter this sector.
We've engaged in numerous discussions and collaborations with both local and international entities, prioritizing continuous professional development through training programs and seminars, benefiting thousands.
In social responsibility, the Association has contributed to community welfare through volunteer activities, spreading joy and warmth to those in need. Additionally, we organized events to strengthen member fellowship and give back to society.
Looking ahead, we embrace the upcoming challenges with optimism, collaborating with industry partners to drive reform in Hong Kong's securities market. In the new year, we are dedicated to serving you and advancing the securities industry's development. The success of our industry hinges on your involvement, and we eagerly anticipate working together to forge a more prosperous and stable future.
Yours sincerely,
Mofiz Chan
Chairman
Hong Kong Securities and Futures Professionals Association