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By Kiuyan Wong November 19, 2021

Hong Kong Exchanges & Clearing Ltd. Chief Executive Officer Nicolas Aguzin said China’s continued expansion will bring about the next “big bang of finance” as the country will look outward to expand investments. 

Speaking via a video link to the Bloomberg New Economy Forum in Singapore, Aguzin said the China’s capital market will triple over the next 10 years and the country will emerge as the largest economy in the world. 

He hit back at any talk of decoupling between China and the rest of the world. “Whatever indicator you look you are seeing more and more interaction,” he said. 

Still, the city’s bourse has been hit by some setbacks recently. It suffered its second consecutive quarterly profit decline in the three months that ended in September against a backdrop of a widening crackdown by China on a broad range of sectors that roiled markets and triggered delays of major initial public offerings. The amount raised in IPOs slid 40% in the quarter from a year earlier.

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Aguzin said that in the short term there will be more regulatory pressure, but that in the medium to long term, this regulatory push will “set rules of the game and a lot of countries will probably follow,” he said.  

China has also said it will require technology companies seeking a listing in Hong Kong to undergo a cybersecurity review as part of sweeping new rules aimed at tightening control of information amassed by private firms. The review could damp offerings in the city by Chinese tech firms, which were counting on pivoting toward going public in Hong Kong without needing approval. 

Speaking on the same panel, Gary Rieschel, founding managing partner at Qiming Venture Partners, said the increased regulations could have an impact on capital flows into China. There’s a danger of regulatory overreach, but Hong Kong’s market could succeed if it maintains its independence, he said. 

The New Economy Forum is being organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News.

— With assistance by Alfred Cang, and David Ramli