Hong Kong is well placed to navigate through challenges inside and outside, given its strong policy frameworks and ample buffers, the International Monetary Fund (IMF) said on Tuesday.
In a Staff Report released on Tuesday, the IMF reinforces its conclusions of assessment of the economic and financial positions of the special administrative region (SAR) of China, which were published in November of last year.
The SAR's strong policy frameworks and ample buffers include strong fiscal reserves and robust regulatory and supervisory frameworks, the IMF noted, highlighting that those frameworks and buffers have been built and strengthened further over the last decade.
The IMF reiterated its continued support for the Linked Exchange Rate System (LERS), saying it remains the best arrangement for Hong Kong and anchors the stability of Hong Kong's highly-open economy with its large and globally integrated financial services industry.
The IMF also supported Hong Kong's continued efforts to tap new opportunities as a global financial center.
Paul Chan, financial secretary of the SAR government, welcomed the IMF's positive assessment on Hong Kong, saying the SAR government will reinforce Hong Kong's status as an international financial center as well as a premier capital raising center.
He said Hong Kong will capitalise on the opportunities presented by such major development strategies as the Belt and Road Initiative and the Guangdong-Hong Kong-Macao Greater Bay Area plan.
Norman Chan, chief executive of the Hong Kong Monetary Authority, said the IMF's continued support for the LERS is a strong validation of the robustness of the system and its importance to the economic and financial stability of Hong Kong.
An IMF mission visited Hong Kong from Oct. 23 to Nov. 3, 2017, to conduct the IMF Article IV consultation discussions. The Concluding Statement of the Mission's assessment was published on Nov. 29, 2017. The Staff Report was considered and endorsed by the IMF Executive Board on Jan. 10, 2018.
