Bandar Seri Begawan – Hong Kong is looking to enhance financial and economic ties with Brunei Darussalam and is also keen to venture into Islamic banking.
Trade between Hong Kong, ranked No 1 in economic freedom in the world, and Brunei Darussalam in 2008 stood at US$26 million or HK$200 million.
Most of the imports from Hong Kong to Brunei Darussalam are limited to jewellery, printed materials like magazines and telecommunication equipment.
However, this is about to change with two high profile figures from the Government of the Hong Kong Special Administrative Region scheduled to visit the Sultanate this year to discuss further ties in education and finance.
Miss Subrina Chow, Director of Hong Kong Economic and Trade Office based in Singapore, who was in Brunei Darussalam this week, said, “There is still a lot of potential cooperation that both countries can explore and grow. Mr John Tsang Chun Wah, the Financial Secretary of the Government of the Hong Kong Special Administrative Region will be visiting Brunei in March to discuss financial and economies ties.
“Mr John Tsang is expected to hold discussions on financial cooperation. The Hong Kong Monetary Authority (HKMA) and Bank Indonesia jointly announced the launch of the new cross-border payment-versus-payment (PvP) link between Hong Kong’s US dollar realtime gross settlement (RTGS) system and Indonesia’s Rupiah RTGS system.
“The link will eliminate settlement risk in foreign exchange transactions between the US dollar and Indonesian Rupiah by ensuring the simultaneous delivery of US dollars in Hong Kong and Rupiah in Indonesia. Banks in Indonesia can better manage their counterpart risks arising from the foreign exchange transactions and enhance their operational efficiency in settling those transactions during Asian hours.
“We hope to introduce the same service to Brunei Darussalam’s financial market,” she added.
The Hong Kong financial sector will look into the possibilities of getting involved with Islamic banking and will work with countries like Brunei Darussalam in making this new venture for Hong Kong a reality.
Despite the small Muslim population in Hong Kong, Ms Subrina said due to Hong Kong’s mature capital market, “We feel that we could get involved in Islamic bonds, insurance, Takaful and other sorts of capital market,” which will be one of the areas discussed in March when the financial secretary of Hong Kong visits the Sultanate.
Though Islamic bonds are issued through a number of banks such as HSBC’s sister company Hang Sang Bank Limited, the Hong Kong government, according to Ms Subrina, is interested in helping the industry develop through increasing the volume and diversify the sort of products related to Islamic banking.
The unrestricted clientele, which also allows non-Muslims to partake in investments, is one of the attractions. “Naturally,” said Ms Subrina. “They (Islamic banking) have a bigger, potential pull of investors for these bonds.”
One major reason the government of Hong Kong would like to forge more cooperative relations with the government of Brunei and other Islamic countries in the region is to learn more with regards to Islamic banking due to the country’s experience and expertise considering that Hong Kong is less familiar with the laws related to the field.
Later this year, the Hong Kong Education Secretary Michael Seun will also make a visit to Brunei Darussalam to further forge ties by attracting Brunei’s students to study in Hong Kong’s reputable universities.
The Director of Hong Kong Economic and Trade Office in Singapore said, ” For the past few years, our universities have been aggressively promoting their programmes. We would like to attract more international students to our universities especially from US, Europe, China and Southeast Asian countries like Brunei. “In addition, we would also like to work with Universiti Brunei Darussalam for joint research in various fields for capacity building.”
Speaking on the history of the long business ties between both countries, she said, ” In the 60s, Hong Kong businessmen had already set up factories in Brunei Darussalam. After China opened its market in 1980, most of them moved to China. However, lately many Hong Kong businessmen find it necessary to diversify their business and are looking at potential markets in Southeast Asia.”
She acknowledged that tourism is a growing sector and that many Hong Kong people are coming to Brunei since there are direct flights to Hong Kong.
Miss Subrina, who also visited Ulu Temburong national park before returning to Hong Kong yesterday, said, “The scene from atop the canopy is magnificent, there are not many places where we can see rainforests in their pristine state. Overall, I feel that Hong Kong people will show great interest in visiting the national park.”