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IT Firms Flock to Hong Kong
Mainland and Hong Kong securities institutes are working together to clear the way for domestic high-tech firms to be able to raise capital on Hong Kong's growing enterprise market.
"We are glad to see that more mainland investors are becoming interested in the growing enterprise market. But to raise funds on the market, they need more basic knowledge of how to get listed here," said Thomas C H Wong, chief executive of the Hong Kong Securities Institute.
The institute, co-sponsored by the Hong Kong Exchanges and Clearing Limited and the Hong Kong Securities and Futures Commission, provides a series of training programmes and certificate exams to investors and analysts who want to enter the Hong Kong stock market.
It has been in close contact with China's Science and Technology Ministry and securities authorities to organize exchange tours to facilitate better understanding of the growing enterprise market among domestic high-tech companies.
Wong said another group of Chinese entrepreneurs, led by the National Science and Technology Venture Capital Development Centre, is expected to visit Hong Kong in September.
"The demand seems to be there, so we are considering holding training programmes on the mainland, possibly in Shanghai, Beijing and Shenzhen," said Wong.
The expansion is based on a growing demand of Chinese high-tech businesses looking to raise foreign funds in the Hong Kong capital market.
Statistics from the Hong Kong securities authorities indicate that more than 20 high-tech companies have been listed on the growing enterprise market since it was established last November. More than 40 applications are pending.
But for the soon-to-be opened second boards in Shanghai and Shenzhen, the quick expansion of the Hong Kong growing enterprise market causes unwanted competition, analysts said.
"Competition is necessary for the growth of the market," said Wong. "Besides, the financing needs of high-tech enterprises differ."
However, the entry of more domestic enterprises into the Hong Kong market is still blocked by complicated application process, a sort of double check from securities regulators from the mainland and Hong Kong, as well as higher costs, said Xia Weidong, assistant director of the National Science and Technology Venture Capital Development Centre.
Xia said what makes the Hong Kong market a preferred channel to raise funds is the presently limited financial resources for domestic private and high-tech enterprises, as well as free access to foreign investment.
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