Hong Kong's Financial Secretary Stresses Opportunities in Transition Finance Growth During Green Week
China is spearheading the global transition towards cleaner energy, accounting for nearly 40% of the world's total investment in energy transition. This year, China is expected to invest a staggering US$820 billion in this area.
Meanwhile, Hong Kong is positioning itself as a key player in the transition finance sector. At the eighth Hong Kong Green Finance Association Annual Forum, Paul Chan Mo-po, Financial Secretary of Hong Kong, expressed the city's potential to become a transition finance hub.
The Hong Kong Monetary Authority (HKMA) and the Hong Kong government have been pursuing this vision, aiming to establish Hong Kong as a significant centre for sustainable and transition finance in Asia. The potential financial products cater to the growing market interest in transition investing.
Last year, transition investments in the Asia-Pacific region more than doubled the amount invested in the Americas, signalling a strong commitment to environmental sustainability in the region. In fact, transition investments in the Asia-Pacific surpassed US$1 trillion for the first time last year.
In Hong Kong, the value of transition investments stands at more than HK$1.1 trillion (approximately US$140 billion), with over US$34 billion invested in 2020 alone. High-net-worth individuals have shown a robust interest in this area, demonstrating the potential for further growth.
Transition finance, which supports companies in shifting from high-carbon to low-carbon operations, represents a small fraction of the sustainable-finance market but is gaining traction. The sector is expected to continue growing as the world moves towards a greener future.
The event, held on Monday, marked the opening of Hong Kong Green Week, a week-long celebration of sustainability and green finance in the city. As China leads the way in global energy transition investment and Hong Kong aspires to become a transition finance hub, the future looks promising for the transition to a more sustainable economy.
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