Back in October I visited both Hong Kong and China with the Chancellor.
And the reason we went on that trip, was to promote the links between our asset management industries.
So I’m delighted to be here today.
To celebrate the fact that a Hong Kong based firm.
Has teamed up with a UK based asset manager so successfully.
I’m sure that this collaboration will pave the way for future partnerships.
I’m equally pleased that Source and CSOP (SEE-SOP) have chosen to list their RQFII (R – Q – FEE) – exchange traded fund on the London Stock Exchange.
This sends a powerful message about the progress we’re making on two fronts:
- we’re strengthening our position as an international centre for asset management
- we’re strengthening our position as the Western hub for offshore RMB trading
And I’d like to quickly discuss those themes with you.
The UK as the International Centre for Investment Management:
So why is the UK succeeding as an international centre for investment management?
We’ve got a lot of factors in our favour, like:
- our language, our geography, our time zone
- our openness to foreign businesses
- our existing expertise
And because of those factors, our asset managers currently look after over £5 trillion of assets.
Which represents over a third of the whole European market share.
But we understand that asset managers and investors do have a choice.
And CSOP didn’t have to partner with a London based asset manager.
So we’re not going to sit on our success in this field.
We’re going to build on it.
Last March we launched a Plan to boost our Asset Management sector.
Which abolished Schedule 19.
Established the UK’s tax transparent funds.
And introduced a one stop shop for firms looking to set up in the UK.
And just over a month ago – at the Autumn Statement – we went even further.
And we announced that from next April both stamp duty and stamp duty reserve tax on investors’ purchases of shares in exchange traded funds that are established in the UK will be abolished.
It also makes sense – in this building – to talk about Exchange Traded Funds, or ETFs.
These are – as most of you will know – an increasingly popular type of investment vehicle.
But none of the funds themselves are located here in the UK.
So we’ve changed things around, so that such funds will now receive the same tax treatment whether established in the UK or offshore.
The UK as the Western Hub for RMB
We know that if we want to succeed in a global business environment.
Then we have to keep looking globally.
And one of our strengths in asset management lies in the fact that we are the Western hub for offshore RMB activity.
62% of all RMB trading outside of China takes place here in the UK.
And just a few weeks ago the Industrial and Commercial Bank of China issued the largest ever RMB bond issuance in the UK.
But – again – we don’t want to sit on that success.
We want to build on that success.
So when I was in China last year – talking to the Government and business – we went even further.
PRA agreed to consider applications from Chinese banks to open branches in the UK
- UK was awarded the first RQFII allocation outside of Greater China
Which will allow UK based asset managers to invest directly in Chinese markets.
In fact, I understand that this fund will use CSOP’s Hong Kong RQFII quota to invest in China.
And I hope my next big event like this will be the launch of the first UK RQFII fund to take advantage of the UK’s RQFII allocation!
I want the UK to remain the best place in the world.
To set up a bank.
To set up an insurance company.
To put your assets under management.
And to do that, we have to open ourselves up to new opportunities.
And we have to open ourselves up to the world.
So we’re delighted that you’ve chosen to list this product on the LSE.
We want to wish you every success with the launch of this ETF.
And we’ll look forward to working with you.
And supporting you.
In the future.