Hong Kong: The Epicenter of Wealth Creation in Asia
Asia is experiencing unprecedented wealth creation, and Hong Kong is at the forefront of this economic boom. As the region’s financial and economic powerhouse, Hong Kong plays a significant role in the development of the Greater China region. According to Harshika Patel, JPMorgan’s CEO in Hong Kong, the city has the lion’s share of Asia’s wealth creation, making it a prime destination for managing and growing wealth. Patel believes that Hong Kong and Singapore, the two banking hubs in Asia, both have a bright future ahead of them, with Hong Kong poised to become one of the largest wealth centers in the world.
The Growth of Wealth in the Asia-Pacific Region
The Asia-Pacific region is set to experience significant wealth growth, particularly among ultra high net worth (UHNW) individuals. According to Knight Frank’s Wealth Report 2022, the number of UHNW individuals is expected to increase significantly by 2026. Chinese cities, including Hangzhou, have added millionaires at the fastest rate in the world over the past decade. With approximately 80,000 UHNW families in China, more than 20% of which reside in the Greater Bay Area, Hong Kong is strategically positioned to attract and serve this affluent demographic.
Hong Kong’s Support for Family Offices
Recognizing the importance of family offices in managing intergenerational wealth, the Hong Kong government has taken proactive measures to position the city as a family office hub. Chief Executive John Lee Ka-chiu has proposed a revamped investment migration program, offering fast-track residency to individuals with significant investments in local stocks or other assets. Additionally, the government has introduced tax breaks for family offices and plans to provide art storage facilities and easier rules for setting up charities. With a target of attracting 200 new family offices by 2025, Hong Kong is committed to providing an enabling environment for these entities to flourish.
Challenges and Opportunities in Hong Kong’s Wealth Management Sector
Like any thriving financial center, Hong Kong faces macroeconomic challenges such as geopolitics, inflation and supply chain constraints. These factors have impacted the private wealth management sector, resulting in a decline in assets under management and inflows. However, industry experts remains optimistic about Hong Kong’s future. While clients are aware of these challenges, they also have global ambitions for their businesses and personal wealth. Hong Kong’s resilience and ongoing efforts to adapt to changing conditions position it for long-term success in the wealth management industry.
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The Role of the Hong Kong Academy for Wealth Legacy
The launch of the Hong Kong Academy for Wealth Legacy marks a significant milestone in the city’s journey to become a premier destination for family offices and wealth management professionals. This initiative, led by influential figures like Adrian Cheng Chi-kong and Daryl Ng Win-kong, focuses on fostering collaboration, networking, and talent development within family offices and among industry professionals.
Hong Kong Academy for Wealth Legacy aims to serve as a beacon for socially beneficial collaboration in family businesses. Recognizing the vital role family businesses play in Asian economies, where 85% of companies are family-owned, the Academy provides a platform for owners and managers to engage in meaningful discussions.
Hong Kong Sets the Stage to Lead Asia’s Wealth Management
Hong Kong’s wealth management scene in 2023 is characterized by its ambition, resilience, and commitment to serving Asia’s growing affluent population. With the launch of the Hong Kong Academy for Wealth Legacy and the government’s support for family offices, the city is well-positioned to attract and nurture talent, foster collaboration, and become a global wealth management hub. As Asia’s wealth continues to grow, Hong Kong’s expertise, infrastructure, and forward-looking perspective make it an ideal destination for managing and growing wealth. With a thriving financial center and a clear vision for the future, Hong Kong is set to lead the way in Asia’s wealth management landscape.
