Hong Kong leader on new property measures, attracting foreign talent

Hong Kong Chief Executive John Lee arrives to deliver his keynote address to the Hong Kong Legislative Council on October 19, 2022.

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Hong Kong Chief Executive John Lee on Wednesday announced plans to attract talent and investment to the Asian financial hub, which has lost thousands of residents since the pandemic began.

In his first policy address since taking office in July, Lee said the government will allocate HK$30 billion (US$3.8 billion) to attract businesses to the city and a so-called top talent pass scheme introduce to “encourage talent to pursue their careers in Hong Kong.”

“In the past two years, the local workforce has shrunk by around 140,000. In addition to actively nurturing and retaining local talent, the government will actively scour the world for talent,” an official transcript of his speech said.

Hong Kong Hang Seng Index rose slightly in early trade but gave up gains ahead of the speech. It was last trading 1.9% lower after briefly falling 2%.

Attract foreign talent

Individuals with annual salaries of at least US$318,000 and graduates from the top 100 universities in the world who have three years of work experience within the last five years are eligible for a two-year pass “to explore opportunities in Hong Kong. “

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Foreigners who enter Hong Kong under talent attraction programs, buy a residential property and become permanent residents can apply for a buyer’s stamp duty refund and new stamp duty on their first property, Lee said.

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“The agreement applies to all sales contracts concluded from today,” he added.

Property prices in Hong Kong have fallen quarterly since the third quarter of last year, according to the Rating and Valuation Department.

real estate crisis

Hong Kong’s housing crisis has long been a problem for the city and “solving the housing problem is high on the government’s agenda,” Lee said in his nearly three-hour speech.

The chief executive said his government aims to increase the supply of public housing overall. The government is also aiming to limit the waiting time for public rental housing to 4.5 years from the current 6 years.

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Shares in Hong Kong-listed real estate companies gave up earlier gains as Lee spoke. It was mixed after the lunch break – China Overseas Land and Investment rose 2% and CK Asset rose 0.77%. Country Garden gained 0.71% while Sino Land lost 0.4%.

Asian financial center

Lee also announced measures aimed at improving Hong Kong’s competitiveness as a financial hub, including facilitating the listing of some companies in the city.

Stock exchange operator Hong Kong Exchanges and Clearing will revise the listing rules for its main board next year “to facilitate fundraising for advanced technology companies that have yet to meet earnings and trading record requirements,” he said.

The government will also develop the technology sector.

“Our goal is to recruit at least 100 high potentials or reps [innovation and technology] companies to establish or expand their businesses in Hong Kong in the next five years,” he said, adding that it could attract HK$10 billion in investment and create job opportunities.

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Covid policy

Referring to Covid policy, Lee said his government is “doing our best efforts to discuss with the mainland to seek a gradual and orderly resumption of normal cross-border travel.”

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“Our first objective is to implement a ‘reverse quarantine’ in Hong Kong, also known as ‘pre-departure quarantine’,” where travelers will be quarantined in Hong Kong before traveling to the mainland.

Hong Kong was a British colony before it was handed over to China in 1997 to be governed under the One Country, Two Systems framework. Hong Kong has been promised 50 years of autonomy and has freedoms other Chinese cities don’t have, including limited voting rights.

Hong Kong lifted mandatory quarantines for travelers last month after around two years of Covid-related border control measures. Travelers are still required to take multiple Covid tests and monitor their health upon arrival.

Lee, a Beijing supporter, was the only candidate in the May election, replacing his predecessor Carrie Lam. Some 1,500 members of a largely pro-Beijing election committee voted, and Lee won 1,416 votes to become Hong Kong’s supreme leader.

CNBC’s Jihye Lee and Lee Ying Shan contributed to this report.

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