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Hong Kong economy set for stronger 2026 growth

Hong Kong’s real GDP growth forecast for 2026 is revised up to 3.5% to 4.5%, from 2.5% to 3.5% previously, following robust first-half performance and a strong near-term outlook. Real GDP rose 4.3% year-on-year in the second quarter of 2026, driven by buoyant external trade and resilient domestic demand, bringing the real GDP growth in the first half of 2026 to 5.1% year-on-year, the strongest half-yearly performance in nearly five years. Growth is expected to remain solid in the second half of 2026, supported by the global demand for AI-related electronic products, which should boost Hong Kong’s merchandise trade performance, and logistics services. Exports of services are also expected to benefit from sustained growth in visitor arrivals, alongside steady demand for financial and business services in Hong Kong. Domestically, stable labour market conditions, and solid business and consumer sentiment should sustain demand.

New York ETO promotes Hong Kong’s vibrant culture at dragon boat festival

The Hong Kong Economic and Trade Office in New York (New York ETO) supported the 36th Hong Kong Dragon Boat Festival in New York (HKDBF-NY), continuing its longstanding role since founding the festival in 1990. This year’s festival marks the 40th anniversary of Hong Kong’s gift of teak wood dragon boats to cities across North America, including New York City. At the festival opening ceremony on August 8, the Director of the New York ETO Maisie Ho reflected on this legacy, highlighting how the festival, one of New York City’s largest multicultural festivals, has united communities for 36 years. She said the festival is a celebration of heritage, resilience and teamwork, noting the athletes’ vigour, determination and camaraderie mirror the qualities that define Hong Kong, a cosmopolitan and vibrant gateway city that connects business, talent and ideas, while staying rooted in its cultural heritage. She added that the festival is a testament to the enduring friendship between Hong Kong and the United States.

Ahead of the race weekend, on August 7, the organising committee took the celebration to Wall Street, ringing the closing bell at the New York Stock Exchange. Over the two-day festival, more than 170 teams and over 1,800 paddlers competed, alongside Hong Kong street food, cultural performances and arts and crafts demonstrations. The New York ETO had a festival booth to promote Hong Kong to visitors.

HKEX reappoints Bonnie Chan as CEO for second three-year term

Hong Kong Exchanges and Clearing (HKEX) has reappointed Bonnie Chan as Chief Executive Officer (CEO) for a further three-year term from March 1, 2027 to February 28, 2030, inclusive. HKEX Chairman, Carlson Tong, praised Ms Chan’s leadership since becoming CEO in early 2024, highlighting her efforts to strengthen Hong Kong’s role as a leading international financial centre, and her vision to build a vibrant multi-asset ecosystem that connects capital and opportunities between China and the world, positioning HKEX for long-term growth and success. Under her leadership, HKEX has broadened its business footprint, evolved its listing framework, and enhanced its technology infrastructure and market microstructure.

Climate Finance Conference to be held in September

The third HKMA-DFSA Joint Climate Finance Conference, themed “Driving Transition in a Changing World”, will be held on September 10 in Hong Kong. Co-hosted by the Hong Kong Monetary Authority (HKMA) and the Dubai Financial Services Authority (DFSA), the conference forms part of Hong Kong Green Week 2026. Supported by Hong Kong Exchanges and Clearing and Nasdaq Dubai, it will bring together corporate leaders, investors and policymakers to discuss financing solutions, partnerships and innovations for a credible green transition. The Chief Executive of HKMA Eddie Yue and the Chief Executive of DFSA Mark Steward emphasised the importance of cross-regional collaboration between Hong Kong and Dubai in channelling capital toward real-world sustainable finance solutions and strengthening ties between the two financial centres.

Tax reforms to strengthen Hong Kong’s asset and wealth management hub

The Hong Kong Special Administrative Region (HKSAR) Government introduced legislation to attract more privately-offered funds, family offices and carried interest activities, further strengthening the city’s asset and wealth management hub and supporting private credit, digital assets and commodities in June. The proposed measures include expanding the definition of “fund” and scope of qualifying investments; removing the 5 per cent threshold requirement for incidental transactions; relaxing the tax exemption treatment for special purpose entities; and introducing enhancement measures for carried interest. The Bill also introduces a tax reporting mechanism as well as economic substance requirements for funds. The Financial Services and the Treasury Bureau clarified (Aug 12) that remuneration from proprietary trading businesses will not qualify for the proposed tax concessions as they fall outside the Inland Revenue Ordinance’s “fund” definition. Qualifying carried interest must be non-discretionary, performance-linked returns tied to genuine investment management services. The measures are proposed to take effect from the year of assessment 2025/26 with no plans to further expand the scope of these preferential measures.

New batch of Silver Bond launched

The Hong Kong Special Administrative Region Government launched (Aug 5) a new batch of its Silver Bond, offering a minimum interest rate of 4.25%. The target issuance size of the Silver Bond is HK$50 billion (US$6.4 billion), with each unit offering at HK$10,000 (US$1,282) and a tenor of three years with interest paid semi-annually. Residents who turn 60 in or before 2027 and hold a valid Hong Kong identity card are eligible for subscription. The bonds are the retail part of the Infrastructure Bond Programme. Proceeds will be credited to the Capital Works Reserve Fund for investment in infrastructure projects. Financial Secretary Paul Chan said that the Government continues to issue Silver Bond this year, offering senior citizens a safe, steady and low-risk investment option while encouraging the financial sector to tap into the business potential of the silver economy. The bonds will be issued on September 15.

Government’s efficacy enhancement set

The HKSAR Government (Aug 17) announced that the AI Efficacy Enhancement Team has facilitated and implemented its first batch of 30 Efficacy Enhancement Projects, with phased rollouts starting from mid-2026. Established under the 2025 Policy Address, and led by Deputy Chief Secretary Cheuk Wing-hing, the team co-ordinates and steers departments in applying AI technology, exploring process re-engineering and driving technological reforms. The initial phase involves 13 government departments and includes 10 high-impact flagship projects, including transport licences, food business licences, leisure and sports facilities, environmental hygiene, complaint handling and environmental protection. The projects mainly optimise public service queues and application processing to deliver a faster, more user-friendly experience, cutting waiting or processing times by up to 90%. Internal government procedures are also being streamlined, reducing workflows from several days to just a few hours. Supported by a dedicated AI task force, and leading AI enterprises, the Government aims to launch projects progressively in 2026 and 2027 and extend successful solutions across departments.

Hong Kong visitor arrivals rise 11% in first seven months of 2026

Hong Kong welcomed around 4.5 million visitors in July, a 3% year-on-year increase, with a series of major international Meetings, Incentives, Conferences, and Exhibitions (MICE) events and activities boosting business and MICE visitors. During the same period, visitor arrivals from the Chinese Mainland moderated slightly mainly due to inclement weather. The city welcomed a total of 31.22 million visitors in the first seven months of 2026, an 11% year-on-year increase. The Chinese Mainland market maintained a stable overall performance, and long-haul markets, continued to demonstrate strong growth momentum. Looking ahead to the second half of the year, the Hong Kong Tourism Board will roll out a series of flagship mega events covering various areas such as festive celebrations, sports and gastronomy, including the “Hong Kong Cyclothon”, “Hong Kong Wine & Dine Festival”, “Hong Kong Winterfest”, “Hong Kong New Year Countdown Celebrations”, as well as large-scale events for the Mid-Autumn Festival and “Halloween Month”. In his blog post (Aug 9), Financial Secretary Paul Chan noted that these events in the second half of the year are expected to attract over 1.85 million visitors, generate around HK$5.9 billion (US$756 million) in spending, and contribute about HK$3.3 billion (US$423 million) in value added to Hong Kong’s economy.

Hong Kong-born panda twins turn two

Hong Kong’s beloved locally-born panda twins, Jia Jia and De De, turned two on August 15, celebrating with a bespoke ice birthday cake alongside an array of exciting events, with panda fans gathered in Ocean Park to shower the birthday twins with love. Both panda cubs now weigh more than 60 kilogrammes and demonstrate impressive progress in their training, including responding to their names and approaching caretakers when called.

Five-Year Plan consultation ends

The HKSAR Government concluded a two-month public consultation for Hong Kong’s First Five-Year Plan on August 14, drawing an enthusiastic response from the community. Speaking at a media session, Secretary for Constitutional & Mainland Affairs Janice Tse said the general public and various sector stakeholders have taken the plan’s formulation very seriously and contributed keen insights, with over 16,000 submissions received from different sectors, the general public and stakeholders from different backgrounds. Over 100 consultation sessions were organized throughout the period, with the Chief Executive personally leading about 30 of these sessions to listen directly to views from different industries and sectors. Ms Tse said the plan will help the city better seize both international and national development opportunities. “Hong Kong’s Five-Year Plan is a major initiative to integrate into and serve the overall development of the country, and at the same time, a milestone for public administration in Hong Kong,” she said. The Government will continue its efforts to collate and analyse the views and suggestions, and strive to publish the formal document within September.

The Basic Law (BL) is the constitutional document of the HKSAR. It provides the guarantees to maintain our existing way of life, including socio-economic development, the rights and duties of Hong Kong people, the rule of law and other areas. The Basic Law was put into effect on July 1, 1997.

Q: How does the HKSAR manage its monetary and financial systems?

A: The monetary and financial systems of the Hong Kong Special Administrative Region shall be prescribed by law. The Government of the Hong Kong Special Administrative Region shall, on its own, formulate monetary and financial policies, safeguard the free operation of financial business and financial markets, and regulate and supervise them in accordance with law. (BL Article 110)