Hong Kong will host an “invitation only” meeting for some of the world’s richest family offices next month, as the city battles Singapore to attract private wealth and resuscitate its pandemic-battered economy.
The Wealth for Good in Hong Kong event in late March will target representatives of some of the world’s richest families, according to three people with knowledge of the situation.
The gathering would be aimed at the biggest family funds in the Middle East and China, and a smaller number from the US and Europe, two of the people said, adding that invitations were addressed from Hong Kong’s chief executive John Lee.
The city is competing with rival hubs, namely Singapore, to manage private wealth as it seeks to reboot its economy after three years of Covid-19 restrictions drove an exodus of talent and stifled growth. Hong Kong, which reopened its border with mainland China only last month, contracted 3.5 per cent in 2022, while Singapore grew 3.6 per cent.
The city’s government will allocate HK$100mn (US$12.7mn) and set up a steering committee focused on luring family offices, financial secretary Paul Chan said on Wednesday as he outlined Hong Kong’s annual budget, which also included stimulus measures such as consumption vouchers and tax cuts for first-time homebuyers.
“I think that the government realised that this is an area that they should work harder . . . and they can try to attract the potential and the growth of the family office industry,” said Winnie Qian Peng, director of the Roger King Center for Asian Family Business and Family Office at the Hong Kong University of Science and Technology.
“After Covid things will return to normal and a lot of wealthy Chinese, their priority could be . . . Hong Kong.”
A government spokesperson said more details about the wealth management event “will be shared in due course”.
In his policy address in October, Lee said Hong Kong would try to attract “no less than 200 family offices” to expand or establish operations by the end of 2025. The government has also introduced a bill granting tax exemptions on some transactions for single family offices managed in Hong Kong with assets of at least HK$240mn.
The city faces stiff competition from Singapore, where the number of family offices has jumped from a handful in 2018 to an estimated 1,500 last year, according to data analysis firm Handshakes.
Hong Kong also unveiled a slew of policies on Wednesday to stimulate consumption after it spent more than HK$600bn on Covid containment and economic relief measures.
Chan announced that HK$5,000 spending vouchers would be distributed to more than 6mn adult residents, though that amount is half what was allocated last year as the city seeks to rein in its spiralling deficit, which the government estimated at HK$140bn for 2022-23.
Sharp drops in land sales have also knocked Hong Kong’s fiscal reserves to an estimated HK$817bn, almost one-third less than pre-pandemic levels in 2019.
“Our economy is recovering . . . but the situation with the retail sector might not be the same,” Chan said. “We need to reinforce our recovery with another round of [consumption vouchers] using less resources.”
The government will also cut tax rates for first-time buyers of homes that cost HK$9mn or less in an effort to revive its slumping property market. House prices fell 15.6 per cent last year as sales dropped 40 per cent.
Chan projected the economy would expand between 3.5 and 5.5 per cent this year, and estimated an average 3.7 per cent annual gross domestic product growth rate between 2024 and 2027, compared with an average of 2.8 per cent in the 10 years before the pandemic.
