On February 25, Hong Kong's Financial Secretary, Paul Chan, presented the 2026-2027 Budget. The Budget outlined plans to promote the reduction of RMB foreign exchange transaction costs, encourage the issuance of RMB bonds in Hong Kong, and expand the offshore RMB interest rate curve. Concurrently, studies with the mainland will focus on accelerating the launch of treasury bond futures, including real estate investment trusts (REITs) in the Stock Connect program, and incorporating RMB trading counters into the Southbound Stock Connect.

The Budget also mentioned ongoing reforms to the securities market, including market consultations on revising dual-class share structure requirements, facilitating secondary listings for overseas issuers, and promoting T+1 settlement. Other initiatives involve refining the listing framework for structured products and optimizing the regulatory framework for listed companies. Additionally, research will be conducted on establishing a one-stop, multi-asset post-trade securities infrastructure covering stocks and bonds from both the mainland and Hong Kong.

"We will also advance the next phase of reforms," stated Paul Chan. This includes optimizing the continuous regulatory framework for listed companies, providing specific guidance for overseas companies seeking secondary listings in Hong Kong, recognizing more overseas markets as recognized exchanges, and continuing discussions with the market on providing an over-the-counter trading platform for delisted or specially treated shares.

Regarding assets and wealth management, the Budget indicated that legislation will be enacted within the year to optimize the tax systems for family offices and funds, facilitating the privatization of REITs. Amendments next year will exempt stamp duty for the transfer of non-residential properties by REITs preparing for listing.

In the area of gold trading, studies will explore providing tax incentives to eligible institutions conducting gold trading and settlement in Hong Kong.

HKEX Chairman, Carlson Tong, commented: "HKEX welcomes the numerous measures proposed by the Financial Secretary in the 2026-2027 Budget. These measures, covering both primary and secondary markets and reforms across multiple asset classes, will further consolidate Hong Kong's position as a leading global international financial center and highlight the SAR government's determination to enhance the long-term competitiveness, resilience, and global influence of Hong Kong's financial market."

HKEX Group Chief Executive Officer, Bonnie Chan, stated: "As core infrastructure for Asian financial markets, HKEX is committed to consolidating Hong Kong's vital role as an international financial center through strategies such as deepening market connectivity, building a multi-asset ecosystem, and enhancing market resilience and efficiency. HKEX welcomes the various initiatives in the Budget and looks forward to working closely with the SFC and market participants to continuously drive product innovation, lead market discussions on reform, and further enhance the attractiveness of Hong Kong's capital market, creating greater opportunities for issuers, investors, Hong Kong society, and the global financial market."