Editorial | Enhancing economic ties with powerhouse Indonesia is crucial
Hong Kong’s finance chief Paul Chan is right to woo Jakarta as the Asean country’s clout in global business continues to grow
Financial Secretary Paul Chan Mo-po’s focus right now is preparation for the 2024-25 budget that will be unveiled next month. It says something about the importance of relations with Indonesia that he found time to join a Hong Kong delegation to a symposium in Jakarta this week organised by the Trade and Development Council, “Think Business, Think Hong Kong”.
The title speaks for itself about the potential for closer business relations between Hong Kong’s international capital markets and the world’s fourth most populous nation and biggest Southeast Asian economy. It is given added point by news that Indonesia has just become the newest full member country – and first Southeast Asian member – of Brics, the cooperative grouping founded by Brazil, Russia, India, China and South Africa seen as a rival to the Group of Seven (G7) wealthy countries.
Chan’s trip reflected a long tradition of trade and business ties between Hong Kong and Indonesia and came after bilateral relations with China under new Indonesian President Prabowo Subianto got off to a promising start. Indeed, many Chinese companies are now looking for investment opportunities in Indonesia. In that regard one of Chan’s goals was to connect Indonesia with the Greater Bay Area economic powerhouse through its financial hub of Hong Kong.
In front of senior Hong Kong executives, innovators, start-ups and professional service providers, Chan talked up the advantages of Hong Kong’s capital markets to government officials and business elites in Jakarta. They included proximity to China and a robust stock exchange with access to international and mainland capital. Moreover, amid corporate diversification and rising geopolitical tensions, he said Hong Kong offered extensive international connections. The city’s capital markets would also suit financing infrastructure projects under the nation’s “2045” development plan.
That said, Hong Kong is competing with other members of the Association of Southeast Asian Nations in developing investment ties with Indonesia. Hong Kong has built a strong investment presence, but there remains room for promoting what the city has to offer, including a strong legal system and deeper liquidity.
