As the city closes in on mandatory reporting of ESG, smaller fund managers and asset owners will need to find ways to cover a whole new world of reporting and transparency.
The country has slowly liberalised its financial markets, but it can do more to attract international investors, says the Asia Securities Industry Financial Markets Association.
Big fixed income investors will see the newly approved China-Hong Kong bond trading link as inferior to other access channels, though smaller players should find it useful, say industry experts.
A bond-trading link between Hong Kong and China is unlikely to attract strong retail flows and could distract from the opening of the mainland interbank debt market, says the association's CEO.
China's onshore and offshore bond markets are likely to be connected to each other in the coming months, AsianInvestor has been told. This is despite concerns over the different trading systems used.
The industry association says share-transfer and pre-delivery rules are preventing long-only managers from using the trading link. It expects regulators to tackle the latter issue early in 2015.
Charles Li, chief of Hong Kong Exchanges and Clearing, voices confidence that uncertainties surrounding tax issues will be cleared up before the trading scheme’s launch next week.
The trade body has asked Hong Kong’s securities watchdog to give up to a month's advance warning before launching the Shanghai-Hong Kong link, amid uncertainty over issues such as a mooted tax.
Despite wide-ranging reforms, trade body Asifma foresees China maintaining a range of inflow and outflow restrictions in 2020, especially for large direct investment deals.
Institutional investors that trade multiple Asian markets using swaps and synthetics may see their block size orders getting a later priority than other investors.
Association Asifma is set to announce a new group to provide a regional voice for asset management firms in Asia. An industry veteran has been appointed to head it.
Traders and brokers have set aside competing commercial interests to develop a due diligence checklist to comply with Hong Kong's incoming regulatory regime for e-trading.