News
 
  • The HKMA Infrastructure Financing Facilitation Office (IFFO) announced today that nine new entities have joined as IFFO partners.
    NPIFFO
    16 Jan
    2018

    Nine New Partners joining IFFO
     

    The HKMA Infrastructure Financing Facilitation Office (IFFO) announced today that nine new entities have joined as IFFO partners.  They are (in alphabetical order):

     

    1. Beijing Jingneng Clean Energy Corporation Limited
    2. China Communications Construction Company Limited
    3. China Datang Corporation Ltd.
    4. China Energy Conservation and Environmental Protection Group
    5. China Energy Engineering Corporation Limited
    6. China Huadian Hongkong Company Limited
    7. Taikang Asset Management Company Limited
    8. Teachers Insurance and Annuity Association of America
    9. Xinjiang Goldwind Science & Technology Co., Ltd.

     

    Today’s announcement brings the total number of IFFO partners to 87, and will help to grow IFFO further as an effective platform for experience sharing and networking among key stakeholders in infrastructure investment and financing. 

     

    Hong Kong Monetary Authority
    16 January 2018

     

    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders.

     

    The functions of IFFO are:

    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.

     

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.

     

    For more information about IFFO, please visit http://www.iffo.org.hk.

  • Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA), led the Policy Dialogue on “Impact of China Policies on Global Economic Development” at the 2018 Asian Financial Forum (AFF) today, attracting over 2,000 overseas and local industry representatives.
    AFFPD
    AFFPD_001 
    Photo
    15 Jan
    2018

    HKMA Chief Executive leads Policy Dialogue on Impact of China Policies on Global Economic Development
     

    Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA), led the Policy Dialogue on “Impact of China Policies on Global Economic Development” at the 2018 Asian Financial Forum (AFF) today, attracting over 2,000 overseas and local industry representatives.

     

    The Policy Dialogue comprised prominent speakers including (in alphabetical order of organisation name) Mr Jin Liqun, President of the Asian Infrastructure Investment Bank; Mr Hu Huaibang, Chairman of the China Development Bank; Dr Andreas Dombret, Member of the Executive Board of the Deutsche Bundesbank; Mr Stuart Gulliver, Group Chief Executive of HSBC Holdings plc and Mr David Lipton, First Deputy Managing Director of the International Monetary Fund.

     

    As the world’s second largest economy, China has been playing an increasingly crucial role in shaping global economic dynamics. The Policy Dialogue, moderated by Mr Chan, discussed the impact of various Chinese policy initiatives including renminbi internationalisation, capital account reform and the Belt and Road Initiative on global economic and market developments.

     

    Hong Kong Monetary Authority
    15 January 2018

  • Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA), visited China Development Bank (CDB) today and met with its President Mr Zheng Zhijie. Mr Chan welcomed CDB’s issuance of its first Belt and Road bond in Hong Kong to finance projects across Belt and Road countries.
    HKMAWCDB
    HKMAWCDB_001 
    Photo
    20 Dec
    2017

    HKMA welcomes China Development Bank’s issuance of its first Belt and Road bond in Hong Kong
     

    Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA), visited China Development Bank (CDB) today and met with its President Mr Zheng Zhijie.  Mr Chan welcomed CDB’s issuance of its first Belt and Road bond in Hong Kong to finance projects across Belt and Road countries.

     

    “CDB has been an anchor partner of the HKMA Infrastructure Financing Facilitation Office (IFFO), and a Memorandum of Understanding (MoU) was signed between the HKMA and CDB last December to foster closer collaboration via IFFO,” said Mr Chan.  “This first ever issuance of Belt and Road bond by CDB in Hong Kong underscores the pivotal role that Hong Kong can play in facilitating the financing of infrastructure projects in the region.” 

     

    Established by the HKMA in July 2016, IFFO is committed to facilitating infrastructure investments and their financing by working with a cluster of key regional and international stakeholders. As of today, IFFO has 78 partners.

     

    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:

     

    • to provide a platform for information exchange and experience sharing;
    • to build capacity and knowledge on infrastructure investments and financing;
    • to promote market and product development; and
    • to facilitate infrastructure investment and financing flows.

     

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.

     

    For more information about IFFO, please visit http://www.iffo.org.hk.

     

    Hong Kong Monetary Authority
    20 December 2017

  • The seventh private sector-led Hong Kong-London Financial Services Forum (the “Forum”) convened on Monday 18 December in Hong Kong...
    HKLFSF
    The HKMA welcomes the joining of City of London as a partner of the Infrastructure Financing Facilitation Office (IFFO). Mr Vincent lee, Executive Director (External) of the HKMA and Deputy Director of the IFFO (left) and Ms Sherry Madera, Special Advisor for Asia of the City of London (right). 
    Photo
    18 Dec
    2017

    Hong Kong-London Financial Services Forum 2017
     

    Click here for more information

  • The Hong Kong Monetary Authority (HKMA) Infrastructure Financing Facilitation Office (IFFO) is a platform established by the HKMA in July 2016 to facilitate infrastructure investments and their financing.
    RPIFFO
    28 Sep
    2017

    HKMA Quarterly Bulletin: Recent Progress of the HKMA Infrastructure Financing Facilitation Office
     

    Click here for more information

  • Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA), was in London yesterday (21 September, London time) to promote Hong Kong as the gateway to Belt and Road investment and financing opportunities.
    TATHK
    TATHK_001 
    Photo
    22 Sep
    2017

    HKMA Promotes Hong Kong as the Gateway to Belt and Road Opportunities
     

    Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA), was in London yesterday (21 September, London time) to promote Hong Kong as the gateway to Belt and Road investment and financing opportunities.

     

    “Ever since the beginning of China’s Reform and Opening Programme in the late 70s, Hong Kong has served as the hub and springboard for foreign capital wanting to invest on the Mainland, providing over 50%-60% of all foreign direct investment (FDI) flows.  In the last 10 years, when China has entered into a new era of “Going Out”, Hong Kong again serves as the hub and springboard of Mainland’s investments overseas, receiving over 60% of all overseas direct investment (ODI) flows.  Against this background, Hong Kong is uniquely well-positioned to play an unparalleled role in intermediating infrastructural investment and financing, both debt and equity, under the promising prospect of the Belt and Road Initiative, thus greatly facilitating and catalysing investment flows.” 

     

    “The Infrastructure Financing Facilitation Office (IFFO), set up by the HKMA in July 2016, is tasked to build a platform to bring together like-minded stakeholders interested in infrastructural investments in the Belt and Road countries with a view to facilitating and mobilising more efficient investment flows.  IFFO is an open platform and, amongst its 77 Partners, there are 14 that are UK based, which underscores the strong trade and financial links between the UK and Hong Kong.  The HKMA welcomes a closer partnership with interested UK stakeholders to further develop and participate in Belt and Road investment opportunities through the IFFO platform as well as the HK-London Financial Services Forum.”

     

    The seminar led by Mr Chan on “Hong Kong: Gateway to Belt and Road Opportunities” attracted around 170 attendees from UK authorities, financial institutions and corporates.  It was joined by the following industry experts (in alphabetical order of organisation name):

     

    • Mr Alain Carrier, Senior Managing Director & Head of International, Head of Europe (London Office), Canada Pension Plan Investment Board;
    • Mr Song Debin, Deputy General Manager, Marketing Development, China Communications Construction Company Ltd. (International);
    • Mr Samir Assaf, Group Managing Director and Chief Executive of Global Banking and Markets, HSBC Holdings plc;
    • Mr Ram Mahidhara, Chief Investment Officer, International Finance Corporation; and
    • Mr Ben Way, Chief Executive Officer, Macquarie Group Asia.

     

    The speakers shared views on the importance of infrastructure investments along the Belt and Road, investment opportunities as well as challenges, and how the Hong Kong’s financial services sector and IFFO can help UK corporations connect with the vast opportunities arising from the Belt and Road Initiative.

     

    IFFO was established in July last year by the HKMA to serve as a collaboration platform bringing together key stakeholders in facilitating infrastructure investments and financing.

     

    The seminar was part of the “Think Asia, Think Hong Kong” promotion programme organised by the Hong Kong Trade Development Council in London.

     

    Hong Kong Monetary Authority
    22 September 2017

     

    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:

     

    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.

     

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.

     

    For more information about IFFO, please visit http://www.iffo.org.hk  

     

     

  • The Hong Kong Monetary Authority (HKMA) signed an agreement with the International Finance Corporation (IFC), a member of the World Bank Group, yesterday (19 September) in London, committing US$1 billion to the innovative Managed Co-Lending Portfolio Program (MCPP) debt mobilization platform for emerging markets. The HKMA will support IFC in financing projects across more than 100 countries, including in infrastructure, telecom, manufacturing, agri-business and services....
    MCPP_IAS
    mcpp_ias_001 
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    20 Sep
    2017

    The HKMA Commits US$1 Billion to IFC’s MCPP for Investing Across Sectors in Emerging Markets 
     

    The Hong Kong Monetary Authority (HKMA) signed an agreement with the International Finance Corporation (IFC), a member of the World Bank Group, yesterday (19 September) in London, committing US$1 billion to the innovative Managed Co-Lending Portfolio Program (MCPP) debt mobilization platform for emerging markets. The HKMA will support IFC in financing projects across more than 100 countries, including in infrastructure, telecom, manufacturing, agri-business and services.


    “MCPP is an essential part of IFC’s business development in emerging markets.  This new partnership with the HKMA signifies the expansion of IFC’s base of important long-term, strategic partners.  With the collaborative efforts of two institutions, we look forward to further realizing the growth potential of emerging markets in a sustainable manner,” said Mr Dimitris Tsitsiragos, IFC Vice President, New Business at the signing ceremony.  “The HKMA’s participation in MCPP will allow IFC to provide more financing to projects, benefiting millions of people by creating jobs, raising living standards, and improving connectivity.”


    The Chief Executive of the HKMA, Mr Norman Chan said, “We are very pleased about this new partnership with IFC, which provides a useful platform for the HKMA to broaden its investment opportunities in the credit market.”


    “Emerging markets present a broad array of untapped investment opportunities with good long-term growth potential.  Joining hands with IFC allows long-term institutional investors like the HKMA to ride on the considerable expertise, experience and network of IFC in sourcing investable opportunities with proper risk management and governance framework.  Together, we will support commercially viable projects in emerging markets.”


    “Noting the attractiveness of steady long-term return in infrastructure investments, the HKMA has been active in expanding this new asset class for the Exchange Fund.  The setting up of the Infrastructure Financing Facilitation Office (IFFO) has facilitated this process by bringing together like-minded investors, multilateral development institutions like IFC and project developers.  IFFO will continue to play a catalytic role in pooling together interested equity and credit investors for infrastructure investments in emerging markets.”


    Mr Jingdong Hua, Vice President and Treasurer of IFC, warmly welcomed the HKMA as a new partner. “This signing with one of the world’s most respected institutional investors demonstrates again that MCPP as a mobilization platform has widespread appeal,” Mr Hua said, “We have received keen interest from the market, and doubled the amount of financing available under MCPP to US$6 billion. With these resources now available, IFC can finance vital projects that will also help the poor. We look forward to working together.”


    About IFC
    IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY17, we delivered a record US$19.3 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit http://www.ifc.org.


    About the HKMA
    The HKMA is the government authority in Hong Kong responsible for maintaining monetary and banking stability. It was established in April 1993 by merging the Office of the Exchange Fund and the Office of the Commissioner of Banking.


    The HKMA’s policy objectives are:


    • to maintain currency stability within the framework of the Linked Exchange Rate System;
    • to promote the stability and integrity of the financial system, including the banking system;
    • to help maintain Hong Kong’s status as an international financial centre, including the maintenance and development of Hong Kong's financial infrastructure; and
    • to manage the Exchange Fund.

    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre. For more information about IFFO, please visit http://www.iffo.org.hk.


    Hong Kong Monetary Authority
    International Finance Corporation
    20 September 2017

     

     

  • Hong Kong’s equity market has been booming recently. Knowing that I manage investments at the HKMA, a friend asked during dinner if I had any “hot picks”. I told him that our investment objective is not to engage in speculation. When I was about to illustrate how we are seeking opportunity in long-term investment frontiers, my friend showed no signs of enthusiasm and switched topics immediately. While there was nothing I could do about that, I decided to reach a wider audience at inSight and share with our readers an investment area that is becoming more popular these days – infrastructure.
    IIITFI
    19 Sep
    2017

    InSight: Infrastructure Investment – a Timeless Form of Investment
      
    1. Hong Kong’s equity market has been booming recently. Knowing that I manage investments at the HKMA, a friend asked during dinner if I had any “hot picks”. I told him that our investment objective is not to engage in speculation. When I was about to illustrate how we are seeking opportunity in long-term investment frontiers, my friend showed no signs of enthusiasm and switched topics immediately. While there was nothing I could do about that, I decided to reach a wider audience at inSight and share with our readers an investment area that is becoming more popular these days – infrastructure.

       

    2. From the Xianyang courier route of the Qin Dynasty to all the roads that led to Rome, infrastructure can be regarded as one of the oldest asset classes. Infrastructure investment and operation were usually done by governments in the past. While there was private sector participation, the scale had been far smaller than their investments in other asset classes. However, infrastructure has gradually become a hot topic in the investment arena in recent years for it can bring about long-term and stable return. In this article, I would like to discuss the background of this development and the characteristics of infrastructure investment. I would also briefly touch on the Exchange Fund’s participation in this area.
    3.  

      Strong demand from around the globe

       

    4. Infrastructure generally refers to basic facilities, such as energy and power, transportation, water supply and sewage treatment that are essential to economic development and people’s livelihood. In addition to long investment period and huge capital requirement, infrastructure projects usually involve issues such as the development of large parcels of land and the relocation of residents. Therefore, investment in as well as construction and operation of infrastructure were primarily conducted or led by public sector entities in the past. The main reason that made infrastructure investment a hot topic within the investor community recently is the supply and demand gap between investable opportunities and available capital. In some advanced economies, infrastructure was built several decades to a hundred years ago and is becoming obsolete. Readers who frequently travel to Europe or the US may notice that the quality of infrastructure in some of their cities is even worse than that of some developing countries. This has created a knock-on effect and has been slowing down economic and social development. The infrastructure in these cities is badly in need of redevelopment or refurbishment. The most notable example is the US. Both the Republican and Democratic Parties realise the importance of investing in infrastructure. The Trump administration has promised to introduce a US$1 trillion rebuilding plan to rejuvenate the nation with world-class infrastructure.

       

    5. There is also strong demand for infrastructure development in developing countries, albeit for different reasons. Some of these countries’ social and economic development is still in its infancy. They require investment in basic infrastructure projects to unleash their growth potential. Some other developing countries, such as those in Southeast Asia, have experienced rapid economic growth in recent years and find that their infrastructure (such as power supply) cannot keep up with the growing needs and may even become bottlenecks for further enhancements to productivity. Without improvements, economic growth will be stifled.

       

    6. The abundant supply of infrastructure projects leads to demand for capital. According to projections made by a renowned consultancy, countries from around the world need to make as much as US$49 trillion on infrastructure investment from 2016 to 2030 in order to maintain stable economic growth. Of this amount, around 60% needs to be invested in emerging markets. Should investment in infrastructure projects be maintained at the current level, it is expected that there would be a funding gap of over US$5 trillion in the coming 15 years. At the same time, according to an estimate by the Asian Development Bank, the total amount of infrastructure investment in Asia alone will be over US$20 trillion from 2016 to 2030.

       

    7. Where will the money come from? Traditionally, infrastructure projects are funded by public sector entities such as governments and international development agencies (e.g. World Bank, Asian Development Bank). However, the huge funding gap, coupled with the fact that public finances in many countries are already under pressure, will make it difficult for the public sector to further allocate large sums of capital towards infrastructure spending. Moreover, based on past experience, the public sector has much to learn from the private sector in commercial viability assessment, budget control, operation flexibility and so on. As a result, the Public-Private Partnerships (PPP) model, which brings together investors through multiple channels, has become a common approach adopted by governments to stimulate infrastructure investments. Yet, are investors interested?
    8.  

      Steady return attracts public and private sector investors alike

       

    9. Spurred by a strong global demand for infrastructure investment, participation by public sector and private sector institutional investors as well as multilateral organisations on this front has become increasingly active. A number of large private equity fund managers are ready to invest in or have already committed actual funds to various infrastructure projects. Since its establishment within the HKMA in mid-2016, the Infrastructure Financing Facilitation Office (IFFO) has brought together numerous sovereign funds, international development agencies, large-scale pension funds, insurance companies and other major investors from around the world within the span of a year. These players all share optimism about the prospects of infrastructure investment.

       

    10. Astute investors are only drawn to true gems. What is it in infrastructure investments that attract them?

      Firstly, investors are looking for high-quality investment opportunities amid ample liquidity in the current market environment. As I have mentioned in an inSight article published in January this year, “Exchange Fund: Looking Ahead – A Combination of Prudent and Proactive Approaches to Achieve Long-Term Growth",

      “The investment return of the Long-Term Growth Portfolio has been satisfactory. However, with more and more investors joining the alternative asset bandwagon, quality investment opportunities have become more difficult to come by. This has in turn exerted pressure on the return. Therefore, we are actively exploring new frontiers, which include industries that can counter inflationary pressures, have a low correlation with traditional asset return, offer good potential for growth, and provide a continuous cash flow, e.g. infrastructure. ” 

      While the above subject is the Exchange Fund, the quest is in fact shared by many investors.
    11.  

    12. Another attractive attribute of infrastructure investment is the stable return and cash flow that it offers, especially PPP projects which enable participants to lock in long-term return and cash flow usually through long-term operating contracts awarded by governments. Moreover, as infrastructure constitutes an essential part of people’s livelihood, its return is less affected by economic cycles. For institutional investors awash with capital, such as insurance companies, sovereign funds and pension funds, the characteristics of infrastructure investment are very much in line with their own stable and long-term investment strategy.
    13.  

    14. Of course, infrastructure investments carry specific risks, including commercial viability, political and economic risks of relevant jurisdictions, as well as environmental and sustainability concerns. Therefore, appropriate arrangements and measures must be in place for stakeholders to assess, mitigate and avert those risks.
    15.  

    16. Infrastructure investment projects are characterised by a very long investment horizon, easily spanning ten or twenty years, and involve huge upfront capital outlays. For projects requiring multi-billion US dollar investment, only world-class institutions with strong financial standing have the capacity to participate. Further, they will usually line up with other institutional investors to share the risks. Many private sector institutions aspire to team up with some international organisations to take part in these projects, partly taking advantage of the multi-governmental backing that these organisations have, which helps mitigate the political and economic risks. It is also because these international organisations will properly address environmental protection, sustainability, procurement procedures and other governance aspects of investment projects to meet the generally higher standards of today's world. Following close exchanges with many infrastructure stakeholders at the IFFO platform, a reference term sheet has been developed through reaching a consensus on the mitigation measures for various risks associated with infrastructure investment.
    17.  

      Long-term growth at acceptable risk levels

       

    18. Following our in-depth research on infrastructure investment and concept crystallisation on the IFFO platform, the Exchange Fund is now ready to embark on this area of investment. As with other types of investment, we will as always be prudent when making any investments in infrastructure. In particular, we will take the following measures:

    19. (I)

      Infrastructure investment will form only a part of the Long-Term Growth Portfolio of the Exchange Fund.

      (II)

      Each investment must be commercially viable, carefully examined in preparatory studies and must undergo rigorous due diligence. Priority will also be accorded to jurisdictions with proper governance and environmental protection framework.

      (III)

      Appropriate measures will be taken to avoid undue concentration in a particular region, investment type, investment horizon and other attributes.

      (IV)

      We will seek to partner up with like-minded world-class investors to give full play of our respective professional expertise.


    20. In summary, our infrastructure investment strategy is to seek long-term growth within acceptable risk levels. There has been good progress so far in our search for suitable investment projects, with some projects coming close to fruition. I look forward to sharing with you some good news shortly.

     

    Eddie Yue
    Deputy Chief Executive
    Director of Infrastructure Financing Facilitation Office
    Hong Kong Monetary Authority
    19 September 2017

     

  • The HKMA Infrastructure Financing Facilitation Office (IFFO) hosted a panel discussion at the Belt & Road Summit today.…
    BRFO
    BRFO_008
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    11 Sep
    2017

    IFFO on Belt and Road Financing Opportunities

    The HKMA Infrastructure Financing Facilitation Office (IFFO) hosted a panel discussion at the Belt & Road Summit today to promote Hong Kong’s unique advantages in capturing financing opportunities from the Belt and Road Initiative (BRI).  The panel discussion was well received and attended by more than 1,000 overseas and local industry leaders from various sectors.

    The panel discussion on “Capturing Infrastructure Investments and Financing Opportunities through Hong Kong” was led by Dr Victor Fung, Group Chairman of Fung Group and Advisor of IFFO, comprising key stakeholders from the public and private sectors including (in alphabetical order of organisation name) Dr Wang Chunxin, Senior Economist of Economics and Strategic Planning Department of Bank of China (Hong Kong); Mr Chen Xi, General Manager, China Hua Neng Group Hong Kong Limited; Mr Vincent Lee, Executive Director (External) of the HKMA and Deputy Director of IFFO; Mr Ram Mahidhara, Chief Investment Officer, International Finance Corporation; and Mr Darcy Lai, Managing Director, Regional Head of Global Banking, Corporate & Institutional Banking, Greater China & North Asia, Standard Chartered Bank. The speakers exchanged views on the infrastructure needs and financing opportunities along the Belt and Road, and how Hong Kong can position itself to capture these opportunities.

    Dr Victor Fung said, “As an international financial centre with close proximity to the Mainland of China, Hong Kong can serve as a vital gateway to capture Belt and Road financing opportunities.  Today’s panel has helped us better understand where the financing opportunities as well as challenges are, and how Hong Kong can strengthen its long term competitiveness.”

    The panel discussion was part of the Belt & Road Summit organised by the Government of the Hong Kong Special Administrative Region and the Hong Kong Trade Development Council (HKTDC) in Hong Kong.

    HKMA Infrastructure Financing Facilitation Office
    11 September 2017

    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:

    • providing a platform for information exchange and experience sharing; 
    • building capacity and knowledge on infrastructure investments and financing; 
    • promoting market and product development; and 
    • facilitating infrastructure investment and financing flows.

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.

     

     For more information about IFFO, please visit http://www.iffo.org.hk
     

  • The HKMA Infrastructure Financing Facilitation Office (IFFO) is hosting a Senior Executive Training Program from 31 July to 4 August on Public-Private Partnerships (PPPs) and Project Finance. This tailored training, now running in its ninth year, is organised by the International Finance Corporation (IFC) in partnership with the Harvard Kennedy School (Harvard). IFFO is pleased to host this year’s Asia-Pacific session in Hong Kong....
    Harvard
    Harvard_001
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    01 Aug
    2017

    IFFO collaborates with IFC and Harvard on PPP and Project Finance Training Program and announces 13 new partners 

    The HKMA Infrastructure Financing Facilitation Office (IFFO) is hosting a Senior Executive Training Program from 31 July to 4 August on Public-Private Partnerships (PPPs) and Project Finance.  This tailored training, now running in its ninth year, is organised by the International Finance Corporation (IFC) in partnership with the Harvard Kennedy School (Harvard).  IFFO is pleased to host this year’s Asia-Pacific session in Hong Kong. 

    The Program’s objective is to advance the dialogue on PPPs and Project Finance to a broad group of experts and decision makers with a view to fostering the development of infrastructure projects that better address the needs of the population and governments.  The Program is attended by 50 senior executives from institutional investors, development and policy banks, project developers and operators, as well as public officials from countries such as Bangladesh, China, India, Mongolia, Nepal, Thailand, and World Bank and IFC representatives with experience in advisory and investment areas.

    The Program is another deliverable under the Memorandum of Understanding (MoU) signed between the HKMA and IFC in July last year.  According to the MoU, both parties agree to cooperate to support capacity building with a view to promoting an efficient and conducive market environment for infrastructure financing. 

    Mr Eddie Yue, Deputy Chief Executive of the HKMA and Director of IFFO, said, “We are pleased to host this executive program with IFC and Harvard. This marks our second collaboration with IFC and continuous commitment in building capacity and knowledge of IFFO partners and other stakeholders.  Collaborating with Harvard ensures a rich learning experience on various emerging issues on PPPs and project finance through interactive exchanges among academics, policymakers and industry experts. ” 

    IFC Director for East Asia and the Pacific Vivek Pathak said: “Appropriate policies and services can help countries build and manage modern infrastructure more efficiently and effectively. The World Bank Group will continue to support PPPs and create market conditions for sustainable infrastructure development along the Silk Road.”

    IFFO is also pleased to announce that 13 more organisations have joined IFFO as partners.  They are (in alphabetical order):

    (1) AustralianSuper
    (2) CGCOC Group (Hong Kong) Co., Limited
    (3) Crédit Agricole Corporate and Investment Bank
    (4) Currie & Brown
    (5) Deloitte China
    (6) Ernst & Young
    (7) Japan Bank for International Cooperation
    (8) Jardine Lloyd Thompson Limited
    (9) Legg Mason Global Asset Management
    (10) Malayan Banking Berhad
    (11) Mitsui & Co. (Hong Kong) Ltd.
    (12) Morgan Stanley
    (13) Willis Towers Watson

    Mr Eddie Yue said, “It is encouraging that the number of IFFO partners has grown from 41 to over 70 in one year. This clearly demonstrates IFFO is well recognised as an effective collaboration platform bringing together key stakeholders in facilitating infrastructure investment and financing.” 

    About HKMA Infrastructure Financing Facilitation Office (IFFO)
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders.  The functions of IFFO are:

    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.

    For more information about IFFO, please visit http://www.iffo.org.hk.

    About International Finance Corporation (IFC)
    IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY16, we delivered a record $19 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit www.ifc.org

     

  • IFC, a member of the World Bank Group, today (28 June) signed an agreement with Eastspring Investments, the Asian asset management business of Prudential plc, to raise $500 million for an innovative IFC programme that mobilises funds from institutional investors for infrastructure projects in emerging markets...
    MCPP
    MCPP_001
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    28 Jun
    2017

    IFC Raises $500 Million from Prudential’s Eastspring for Infrastructure in Emerging Markets

    IFC, a member of the World Bank Group, today (28 June) signed an agreement with Eastspring Investments, the Asian asset management business of Prudential plc, to raise $500 million for an innovative IFC programme that mobilises funds from institutional investors for infrastructure projects in emerging markets. Eastspring is the first Asian investor to participate in the programme, known as Managed Co-lending Portfolio Program(MCPP) Infrastructure. The signing ceremony was hosted by Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA).


    The programme seeks to raise $5 billion from global institutional investors to modernise infrastructure in emerging markets by 2021, opening up a new stream of capital flows to improve power, water, transportation, and telecommunications systems in developing countries.


    “Building sustainable infrastructure strengthens economies, allows for cross-border business, and helps create new markets,” IFC Vice President and Treasurer, Jingdong Hua said at Wednesday’s signing. “This new partnership with Eastspring will help bring reliable power, roads, and other critical infrastructure to areas where they are urgently needed. IFC will continue to work with governments and investors to mobilise additional resources for infrastructure development in developing countries.”


    “We look forward to working with IFC on this initiative. As a business with a strong focus in the developing world, we have long been committed to realising the full growth and development potential of emerging markets. Raising awareness and boosting infrastructure investment is a crucial part of that and we are always looking for innovative and sustainable ways to provide attractive long term returns for our clients. This partnership enables us to make a significant contribution to the economies and communities of developing countries while investing in infrastructure projects that deliver compelling returns for our clients,” said Virginie Maisonneuve, Chief Investment Officer of Eastspring Investments.


    In most developing countries basic infrastructure is failing, insufficient, or non-existent—compromising livelihoods and holding back economies. More than 1.2 billion people worldwide have no access to electricity. More than 660 million people don’t have a clean source of drinking water and one in three people worldwide lack access to sewage infrastructure. With the number of people living in cities in Asia estimated to double by 2030, the infrastructure deficit will only become larger.


    Under the agreement IFC will originate transactions and provide Eastspring with co-lending opportunities in all deals that fit with Eastspring's investment strategy.


    Commenting on this partnership, Tony Adams, Infrastructure CIO at Eastspring Investments said, “The G20 and other global institutions have been calling on multilateral lenders and the private sector to find ways to help close the global gap in infrastructure funding. The structure of this partnership breaks new ground in providing a credit enhanced platform for our clients to participate in a portfolio of emerging market infrastructure loans. It also develops our access and capability to lend directly to compelling infrastructure projects.”


    "I am delighted to host the signing ceremony between IFC and Eastspring, both of whom are valuable partners of the HKMA Infrastructure Financing Facilitation Office (IFFO)”, said Norman Chan, Chief Executive of the HKMA. “Trillions of dollars a year are required to bridge the infrastructure gap in emerging markets, and it is impossible for the public sector alone to fulfil such needs without substantially drawing in private sector capital. Through the IFFO platform, we look forward to collaborating more closely with public and private sector stakeholders, with a view to developing a more conducive environment in Hong Kong for facilitating infrastructure investment and financing.”


    MCPP Infrastructure is designed for institutional investors seeking to increase their exposure to emerging markets infrastructure. Through the programme, IFC originates, approves, and manages a portfolio of loans that mirrors IFC’s own portfolio in infrastructure.


    With support from the Swedish International Development Cooperation Agency (Sida), IFC provides a limited first-loss guarantee on the programme’s investments to meet the risk-reward profile that institutional investors require. The other first mover partnership under the MCPP Infrastructure programme is the global insurance company Allianz.


    IFC
    Eastspring Investments
    HKMA Infrastructure Financing Facilitation Office
    28 June 2017


    About IFC
    IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY16, we delivered a record $19 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit www.ifc.org.


    About Eastspring Investments
    Eastspring Investments, part of Prudential Corporation Asia, is Prudential's asset management business in Asia. With operations in 10 Asian markets as well as offices in North America and Europe), we have almost 2,500 employees and US$146 billion in assets under management (as of 31 December 2016). We were named Asia’s leading retail fund manager for 2016 in an annual survey by Asia Asset Management. The annual survey ranks participating fund managers in Asia, ex Japan, Australia and New Zealand, based on assets sourced in the region as of June 30, 2016. For more information on Eastspring Investments, please visit: www.eastspring.com.


    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • Providing a platform for information exchange and experience sharing;
    • Building capacity and knowledge on infrastructure investments and financing;
    • Promoting market and product development; and
    • Facilitating infrastructure investment and financing flows.

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre. For more information about IFFO, please visit http://www.iffo.org.hk.



  • Last Sunday (14 May), as a member of the Hong Kong Special Administrative Region delegation, I attended the Belt and Road Forum for International Cooperation in Beijing. Let me share with you some of my thoughts in this article…
    IBRF
    Insight_BRForum_1
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    18 May
    2017

    inSight: Belt and Road Forum for International Cooperation

    Last Sunday (14 May), as a member of the Hong Kong Special Administrative Region delegation, I attended the Belt and Road Forum for International Cooperation in Beijing. Let me share with you some of my thoughts in this article. Judging by the number and ranking of the participants, it was a truly high-level summit. With as many as 1,500 participants from over 130 countries and 70 international organisations, including nearly 30 foreign heads of state and government, the event is a clear testament that the Belt and Road (B&R) Initiative is highly regarded by and receives broad recognition from countries all over the world. President Xi Jinping said in his address that the B&R Initiative represented an open and inclusive platform for development, with equal participation by all countries and following the principles of “wide consultation, joint construction and shared benefits”.


    In just three years or so since the concept was first raised in autumn 2013, the B&R Initiative has gained support from the international community. In particular, amid the current anti-globalisation, anti-free trade and xenophobic sentiment in some major Western industrial countries, a vision that rejects “closed-door” narrow-mindedness and introversion while vowing steadfastly to look at problems and find solutions from the lofty perspective of global development and governance requires much courage and a big commitment.


    In the process of moving the B&R Initiative forward, Hong Kong cannot be left out. With our unique advantages, we can indeed play a very important role. After attending the Forum’s plenary session in the morning, I joined a panel session on Financial Connectivity in the afternoon as a speaking guest. It was like a gathering between old acquaintances. Moderating the panel was Mr Zhu Ming, an old friend for years from his time as former Deputy Managing Director of the International Monetary Fund and former Deputy Governor of the People’s Bank of China. Among the seven other panelists, five of them were partners of the HKMA’s Infrastructure Financing Facilitation Office (IFFO), including Ms Hu Xiaolian, Chairman of the Export-Import Bank of China; Mr Stephen Schwarzman, Chairman and CEO of Blackstone Group; Mr Yi Huiman, Chairman of the Industrial and Commercial Bank of China; Ms Jin Qi, Chairman of Silk Road Fund; and Mr Jose Vinals, Chairman of Standard Chartered PLC.


    On “Financial Connectivity”, the focus of the panel discussion was on how to facilitate investment and financing for B&R infrastructure projects. I certainly didn’t miss out on the opportunity to promote Hong Kong’s strengths.


    Firstly, Hong Kong has all the prerequisites as an investment and financing hub for the B&R Initiative. Being the premier international financial centre in Asia, we can be a one-stop shop in providing various services, including investment and financing, professional services, and risk management, for infrastructure projects around the world and in particular within the region. Hong Kong is the global offshore renminbi business hub. It is also the best place for Mainland enterprises to test the water, and the ideal springboard from which they can “go out”. These put us in a very advantageous position for taking part in the B&R Initiative.


    Furthermore, we have the first-mover advantage due to proximity. Under “One Country”, we are privileged to start early in leading the way, while under “Two Systems”, we are able to bring the Mainland and international investors and other stakeholders together. During the panel discussion, I specifically mentioned the establishment of IFFO by the HKMA in July last year. In less than one year, we have lined up more than 60 heavyweight and like-minded organisations from home and afar as our partners, including multilateral development banks, infrastructure project developers and operators, banks, insurance companies and professional service firms, as well as institutional investors such as sovereign wealth funds, pension funds and private equity funds with total assets under management over US$4 trillion. As a platform for sharing information and experience and increasing their mutual understanding, IFFO seeks to raise interest in infrastructure financing and facilitate infrastructure investment and financing activities and opportunities.


    During the high-level Debt Financing and Investors’ Roundtables held in March this year, IFFO developed a reference term sheet for infrastructure investment, setting out the potential risks associated with various types of infrastructure investments and the mitigation measures to help reduce the risks, including financial risk (e.g. exchange rate fluctuations), business risk (e.g. counterparty delinquency or default), construction risk and regulatory risk. The reference term sheet is unprecedented in public and private sector investment and financing, as it contains a list of key requirements that both investors and operators have to understand and implement. With the reference term sheet, project developers can address more specifically the concerns and expectations of investors when seeking funding, while investors can have more confidence in tapping the emerging markets.


    Infrastructure financing, put simply, means matching “money looking for projects” and “projects looking for money”. Off to a good start, IFFO has laid a solid foundation for the development of infrastructure financing in Hong Kong. The next step will be to make good use of the cluster of good partners at IFFO to create a more specific new platform that will be instrumental in matching capital and large-scale infrastructure projects and help bring investment projects to fruition, thereby creating greater and more opportunities for the financial and professional services industry in Hong Kong and contributing to the development of the B&R Initiative.


    Norman Chan
    Chief Executive
    Hong Kong Monetary Authority
    18 May 2017

  • The HKMA Infrastructure Financing Facilitation Office (IFFO) has been established for nine months. As IFFO has organised the Debt Financing and Investors' Roundtables recently...
    IIFFO
    Insight_cover-2-2
    12 APR
    2017

    inSight: A Promising Future for Infrastructure Investment and Financing

    The HKMA Infrastructure Financing Facilitation Office (IFFO) has been established for nine months. As IFFO has organised the Debt Financing and Investors’ Roundtables recently, I have taken this opportunity to review with my colleagues the work we have done so far. Our view is that the groundwork of IFFO has been laid successfully and we are optimistic about the long-term outlook of infrastructure investment and financing.


    IFFO’s mission is to facilitate infrastructure investment and financing by working with key stakeholders. At present, infrastructure investment and financing is not yet a popular asset class in Hong Kong. Indeed, the development of Hong Kong into an infrastructure investment and financing centre takes time and requires a great deal of hard work and patience during the early stages. Some of the important first steps that we are undertaking include building up the capacity of the industry in infrastructure investment and financing, and bringing in more investment opportunities in infrastructure.


    Regarding capacity building, IFFO has, since its establishment, built an extensive network comprising 63 prominent partners. These include financial intermediaries such as multilateral organisations, institutional investors and banks, infrastructure project developers and operators and various professional service firms. IFFO has organised and participated in 13 large-scale conferences, seminars and workshops on infrastructure investment and financing, including a seminar entitled “President Jin Liqun on Asian Infrastructure Investment Banks’ Operations and Projects”. We have signed memorandums of understanding with China Development Bank and The Export-Import Bank of China respectively, to support and encourage them to use Hong Kong’s platform to “go global”. At the Asian Financial Forum held in January this year, we also invited representatives from Bangladesh, Hungary, Iran, Kazakhstan and Turkey to share with us the investment environment updates and upcoming opportunities in infrastructure investment and financing in these countries.


    As previously mentioned, IFFO has organised the inaugural Debt Financing and Investors’ Roundtables recently. The event attracted about 100 senior executives from various infrastructure investment and financing organisations, including sovereign wealth funds and pension investors from Australia, Canada, China, South Korea, the Netherlands, Singapore and the United Arab Emirates, with total assets under management reaching US$4 trillion. Attendees also include infrastructure project developers and operators such as China Hua Neng Group, China Three Gorges Corporation, General Electric and CLP Group. The Roundtables discussed emerging market infrastructure investment and financing opportunities, and covered how infrastructure projects could be made more bankable and investable through different risk mitigation measures.


    One reason for the huge funding gap in infrastructure investment and financing1  is the difference in the expectations of investors/financiers and operators. For example, some investors perceive emerging markets as risky and therefore require relatively high returns from infrastructure projects in those markets before agreeing to invest. On the other hand, infrastructure operators may not understand that investors place great emphasis on various factors, such as corporate governance, environmental protection and social responsibility. As a result, interested capital and investable projects can be searching for but missing each other at times.


    A key objective of the IFFO Roundtables was to develop a reference term sheet for infrastructure investment, which sought to come up with a set of common language that can be understood and accepted by the investing/financing and operating sides, thereby narrowing the gap in their expectations and bringing them closer for doing deals. The term sheet set out various factors to be considered for investment, with ”project stage” being one example. As investors tend to be more interested in less-risky brownfield projects, the attractiveness of greenfield projects can be increased by securing land acquisition and approval documentation, or by bundling with brownfield projects, etc. Since institutional investors also attach great importance to governance, infrastructure project operators should put in place proper procurement systems, effective anti-corruption codes, etc. These are the areas that infrastructure project operators should pay attention to.


    The term sheet also included risk mitigation measures regarding various potential risks associated with infrastructure projects, including financial risk (e.g. exchange rate fluctuation), business risk (e.g. counterparty delinquency or default), construction risk and regulatory risk. Effective risk mitigation measures can help investors strike a reasonable balance between risks and returns.


    We hope the term sheet will enable infrastructure project developers with financing needs to better understand issues that may deter potential investors, while strengthening the confidence of investors looking for long-term stable return for investing in emerging markets. It should help promote smoother, more effective communication and co-operation between both sides.


    IFFO will continue to organise and participate in various international and local events to promote information exchange among stakeholders and build capacity in infrastructure investment and financing. The next step will be to encourage investors/financiers, such as institutional investors and banks, to identify potential emerging market infrastructure projects for investment and financing through the IFFO platform, and to facilitate market participants to develop specialised risk management products. Hopefully, successful cases will have a demonstration effect, attracting more funds into emerging market infrastructure projects. I will provide an update on the latest development in due course. Meanwhile, information about upcoming IFFO events will be disseminated on the IFFO website.


    The initial groundwork and early exchanges outlined above constitute small pieces in the final jigsaw. We set a clear goal at the outset: Riding on the global tide of infrastructure investment and financing, we seek to further diversify Hong Kong's financial industry, thereby promoting the development of our financial intermediaries and related professional service chains and creating more high value-added jobs, which will benefit the community as a whole.


    Our hard work over the past few months has already produced a ripple effect. There has been positive feedback from participants in Hong Kong and other parts of the world, with keen interest and great expectations for taking part in the IFFO platform. As they would often say, there are “lots of takeaways”. In the investment world, pragmatism rules, leaving little room for empty talk. Whenever we see a big group of repeat participants as well as many new faces to our events, our conclusion is: this is a promising arena well worth exploring.


    Eddie Yue
    Deputy Chief Executive, HKMA and
    Director, Infrastructure Financing Facilitation Office
    12 April 2017


    1 According to the estimates of the Asian Development Bank, funding needs for infrastructure development in Asia would be about US$1.7 trillion per year on average from 2016 to 2030.

  • The HKMA Infrastructure Financing Facilitation Office (IFFO) organised high-level Debt Financing and Investors’ Roundtables on 23 – 24 March 2017...
    DFIR
    DFIR_001
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    24 MAR
    2017

    IFFO organises the inaugural Debt Financing and Investors’ Roundtables

    The HKMA Infrastructure Financing Facilitation Office (IFFO) organised high-level Debt Financing and Investors’ Roundtables on 23 – 24 March 2017. The events were attended by around 100 top management from the key players in infrastructure investment and financing. They included public and private sector investors, multilateral financial agencies and development banks, asset managers, banks, project developers and professional service firms.


    The Debt Financing Roundtable was held in the afternoon of 23 March. Participants shared experience and opportunities in co-financing initiatives and programmes provided by the public and private sector institutions. They also discussed how infrastructure projects could be made more bankable through different risk mitigation measures.


    The Investors’ Roundtable was held on the following day. It brought together a group of like-minded investors interested in infrastructure investments, including international sovereign wealth funds and pension investors from Australia, Canada, China, South Korea, the Netherlands, Singapore and the United Arab Emirates, with total assets under management exceeding US$ 4 trillion. The discussion focused on the outlook of the global infrastructure investment landscape, setting of common parameters for investing in emerging markets (such as investment structures, revenue characteristics, risk-return analyses as well as environment, social and governance factors), risk mitigations required to make projects more investable, and upcoming infrastructure investment opportunities.


    Mr Norman Chan, Chief Executive of the HKMA, said, “The two-day Debt Financing and Investors’ Roundtables organised by IFFO pools together major institutional investors, multilateral financial institutions, insurance companies, project developers and other stakeholders to conduct thorough discussions on issues such as risk management, governance framework, etc, which are of common interest in the context of infrastructure investment and financing in emerging economies.”


    “While there is a huge demand for infrastructure investment along the Belt and Road countries, institutional investors are also actively seeking long term and stable returns for their large sums of capital. The IFFO Roundtables will enhance the mutual understanding among investors, financiers and project developers, which will facilitate future infrastructure investment and financing in the region.”


    On the announcement made by the Asian Infrastructure Investment Bank (AIIB) on 23 March that Hong Kong will become a new member of AIIB upon deposit of the first installment of capital subscription, Mr Norman Chan said, “I very much welcome the decision of the AIIB’s Board of Governors. As Hong Kong becomes a member of AIIB, we expect our capital markets and financial institutions to be better positioned to serve AIIB in areas including project investment and finance, bond issuance, treasury management, and foreign exchange management. IFFO will work with the AIIB to make use of the Hong Kong platform to further facilitate infrastructure investment and financing in the region.”


    Going forward, IFFO will continue to organise and participate in different international and local events to facilitate information exchange among key stakeholders, and enhance their knowledge on topics related to infrastructure investment and financing.


    HKMA Infrastructure Financing Facilitation Office
    24 March 2017



    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.


    For more information about IFFO, please visit http://www.iffo.org.hk.

  • The Hong Kong Association of Banks (HKAB) and the HKMA Infrastructure Financing Facilitation Office (IFFO) jointly organised the Seminar on Risk Mitigation Techniques in Infrastructure Financing for the Belt & Road Initiative today ...
    HKAB
    img_5552c_02_hor
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    28 FEB
    2017

    HKAB and IFFO’s Seminar on “Risk Mitigation Techniques in Infrastructure Financing for the Belt & Road Initiative” concludes with success

    The Hong Kong Association of Banks (HKAB) and the HKMA Infrastructure Financing Facilitation Office (IFFO) jointly organised the Seminar on Risk Mitigation Techniques in Infrastructure Financing for the Belt & Road Initiative today (28 February 2017). The seminar was productive and successful, with nearly 200 bankers, project finance experts, risk officers and professionals attended and exchanged ideas on the topics.


    Financial capacity is one of the most important aspects to the success of the Belt & Road Initiative. The seminar provided an interactive forum to share insights on how market participants can build more capacity through the inclusion of sophisticated risk mitigation techniques available for infrastructure financing for the Belt & Road Initiative.


    Mr Vincent Lee, Executive Director (External) of the HKMA and Deputy Director of IFFO, said, “IFFO is delighted to work with HKAB in co-hosting this important seminar to discuss risk mitigation techniques in infrastructure investment and financing. Since established in July 2016, IFFO has hosted 10 seminars, panels and workshops to promote capacity building, experience sharing as well as networking. IFFO will continue to organise more events to promote market and product development to facilitate infrastructure investment and financing activities.”


    Mr Li Jiuzhong, Acting Chairperson of HKAB and Chief Risk Officer of Bank of China (Hong Kong), said, “As Asia’s international financial hub with a unique relationship to the Mainland of China, Hong Kong is well positioned to support Belt & Road investments and provide risk mitigation techniques in infrastructure financing. In this new environment of opportunity and challenge, commercial banks, policy banks, insurance companies and other non-bank financial institutions can work closely together with investors to support Belt & Road projects of various scope, scale and diversity.”


    The seminar featured panel discussions on Legal and Regulatory View of Credit Insurance, the Role of Private Sector Credit Insurance, Partnership between Commercial Banks and Development/ Policy Banks, as well as Asian Development Bank's experience sharing on risk mitigation of financing infrastructure projects. The high level of participation in this seminar shows that the Hong Kong banking community is working proactively to grasp this opportunity in cooperation with policy banks, insurance companies and other stakeholders.


    HKMA Infrastructure Financing Facilitation Office
    The Hong Kong Association of Banks

    28 February 2017



    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.


    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.


    For more information about IFFO, please visit http://www.iffo.org.hk.


    About HKAB
    The Hong Kong Association of Banks ("HKAB") was created by The Hong Kong Association of Banks Ordinance, Cap.364 ("Ordinance") in 1981 to replace the Exchange Banks' Association. The Ordinance provides a framework for the Government to exchange views with the banking sector for the further development of the industry.
    Roles of HKAB include:


    • to promote the interests of fully licensed banks in Hong Kong and after consultation with the Financial Secretary to make rules for the conduct of banking business;
    • to be a focal point for consultation on law reform, new legislation and regulatory matters;
    • to form a sounding-board for the Government and other relevant bodies on general business and banking issues;
    • to offer a channel of communication among its members and with third parties; and
    • to promote best practice to members and provide information service.


    For more information about HKAB, please visit http://www.hkab.org.hk.

  • Infrastructure Financing Facilitation Office (IFFO) organised two infrastructure investment and financing events at the 10th Asian Financial Forum (AFF) today.…
    AFF
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    17 JAN
    2017

    IFFO Presents Infrastructure Investment and Financing Insights at the 10th Asian Financial Forum and Announces Nine New Partners

    Infrastructure Financing Facilitation Office (IFFO) organised two infrastructure investment and financing events at the 10th Asian Financial Forum (AFF) today, namely a panel discussion on opportunities and challenges of infrastructure financing in Asia and Hong Kong’s role in these developments, as well as a promotion event on infrastructure investments in selected emerging economies. Both events were well received and attended by more than 600 overseas and local industry leaders from various sectors.


    The panel discussion was moderated by Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority (HKMA). The panel comprised of key stakeholders from the public and private sectors including (in alphabetical order of organisation name) Mr Kairat Kelimbetov, Governor of Astana International Financial Centre; Ms Suyi Kim, Head of Asia Pacific of Canada Pension Plan Investment Board; Mr Geert Peeters, Executive Director & Chief Financial Officer of CLP Holdings Limited; Mr Gordon French, Group General Manager and Head of Global Banking & Markets, Asia Pacific of HSBC; Mr Ben Way, Chief Executive Officer of Macquarie Group Asia; and Mr Liu Jian, Director General of the Department of International Economic Relations, Ministry of Finance, The People’s Republic of China. The speakers exchanged views on the macroeconomic developments, industry trends, opportunities and challenges surrounding infrastructure financing in Asia and the pivotal role that Hong Kong can play in the centre of these exciting developments.


    IFFO organised an Infrastructure Investment Promotion event in the AFF Deal Flow Matchmaking Session and invited representatives from the governments / investment promotion agencies of Bangladesh, Hungary, Iran, Kazakhstan and Turkey to present the investment environment of these countries and elaborate on the upcoming infrastructure projects and financing opportunities.


    IFFO is also pleased to announce nine organisations joining as partners in addition to the existing 54 partners. They are (in alphabetical order):


    1) Actis

    2) AIG Insurance Hong Kong Limited

    3) APG Asset Management

    4) Brookfield Asset Management

    5) China Hua Neng Group Hong Kong Limited

    6) Clifford Chance

    7) Mayer Brown JSM

    8) Pinsent Masons

    9) State Grid Corporation of China.


    The IFFO platform has been strengthened by bringing in partners who have interests and the expertise in different aspects related to infrastructure investment and financing in emerging markets. IFFO will continue to work closely with key stakeholders in facilitating infrastructure investments and financing.


    Infrastructure Financing Facilitation Office
    Hong Kong Monetary Authority
    17 January 2017



    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.


    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.


    For more information about IFFO, please visit http://www.iffo.org.hk.


  • Chief Executive of the Hong Kong Monetary Authority (HKMA), Mr Norman Chan, and Chairman of the China Development Bank Corporation (CDB), Mr Hu Huaibang, signed a Memorandum of Understanding (MoU) with respect to establishing a strategic framework of co-operation to facilitate the financing of infrastructure projects via the Infrastructure Financing Facilitation Office (IFFO) platform…
    MOUCDB
    LO_B0683
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    20 DEC
    2016

    IFFO and CDB sign MoU on infrastructure financing facilitation

    Beijing, December 20, 2016— Chief Executive of the Hong Kong Monetary Authority (HKMA), Mr Norman Chan, and Chairman of the China Development Bank Corporation (CDB), Mr Hu Huaibang, signed a Memorandum of Understanding (MoU) with respect to establishing a strategic framework of co-operation to facilitate the financing of infrastructure projects via the Infrastructure Financing Facilitation Office (IFFO) platform.


    Following CDB becoming an IFFO Partner in July this year and the signing of the MoU today, IFFO and CDB will closely collaborate to promote a more conducive environment for infrastructure investment and financing in Hong Kong, and will jointly facilitate beneficial development of the Belt and Road Initiative through exchanging information and experience in evaluating infrastructure projects, conducting promotion activities, and facilitating infrastructure financing transactions.


    CDB is the world’s largest development finance institution and the largest Chinese bank for foreign investment and financing cooperation, while Hong Kong possesses advantages as the largest offshore Renminbi (“RMB”) business centre and international financial centre. CDB will continue to use Hong Kong as its main offshore platform for infrastructure investments.


    As of October 2016, CDB’s asset in Hong Kong exceeded US$50 billion, and the Bank has through Hong Kong completed 29 infrastructure projects with investments of over US$5 billion in Belt and Road countries.


    CDB will avail more than US$10 billion worth of financing and business opportunities via the Hong Kong platform in the coming future. CDB also plans to expand its Hong Kong operation, increasing the number of staff to more than 210 in the next 2 years, up from 140 now.


    Mr Norman Chan said, “I believe that through closer collaboration between CDB and the IFFO platform, CDB will make greater use of Hong Kong’s advantages in conducting its overseas infrastructure financing and investments. And this would have a demonstration effect, attracting more mainland Chinese corporates to the Hong Kong platform for offshore financing and investments.”


    Mr. Hu Huaibang said, “As an international financial centre and the largest offshore RMB business centre, Hong Kong has unique advantages in developments under the Belt and Road Initiative and is the “super-connector” between Mainland China and the world. CDB will continue to play its role as a leading bank of the Belt and Road Initiative and further strengthen cooperation with the HKMA through the IFFO platform to jointly contribute to the implementation of the Belt and Road Initiative and the prosperity and stability of Hong Kong”.


    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing; 
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.

    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.


    For more information about IFFO, please visit http://www.iffo.org.hk.


    About CDB
    CDB was founded in 1994 as a policy financial institution under the direct leadership of the State Council. It was officially defined by the State Council as a development finance institution in March 2015.


    CDB has a registered capital of RMB 421.248 billion. Its shareholders include the Ministry of Finance of the People’s Republic of China (36.54%), Central Huijin Investment Ltd. (34.68%), Buttonwood Investment Holding Co., Ltd. (27.19%) and the National Council for Social Security Fund (1.59%).


    CDB provides medium- to long-term financing facilities that serve China’s major long-term economic and social development strategies. By the end of 2015, its assets grew to RMB 12.3 trillion, with consistently outstanding market performance. Professional credit rating agencies including Moody's and Standard & Poor's have rated CDB at the same level as China’s sovereign rate.


    CDB is the world’s largest development finance institution, and the largest Chinese bank for foreign investment and financing cooperation, long-term lending and bond issuance. It ranked 87th on the Fortune Global 500 list in 2015.


    CDB currently has 37 primary branches and 3 secondary branches on the Chinese mainland, one offshore branch in Hong Kong and five representative offices in Cairo, Moscow, Rio de Janeiro, Caracas and London, with about 9,000 staff. Its subsidiaries include CDB Capital Co.,Ltd., CDB Securities Co.,Ltd., CDB Leasing Co.,Ltd. and China-Africa Development Fund Co.,Ltd..


    For more information about CDB, please visit http://www.cdb.com.cn.



    HKMA Infrastructure Financing Facilitation Office
    China Development Bank
    December 20 2016

  • Chief Executive of the Hong Kong Monetary Authority (HKMA), Mr Norman Chan, and Chairman of The Export-Import Bank of China (EXIM Bank), Ms Hu Xiaolian, signed a Memorandum of Understanding (MoU) on co-operation in the facilitation of the investment and financing of infrastructure projects via the Infrastructure Financing Facilitation Office (IFFO) platform…
    MOUEXIM
    MoU-Icon
    20 DEC
    2016

    IFFO and EXIM Bank sign MoU on infrastructure financing facilitation

    Beijing, December 20, 2016— Chief Executive of the Hong Kong Monetary Authority (HKMA), Mr Norman Chan, and Chairman of The Export-Import Bank of China (EXIM Bank), Ms Hu Xiaolian, signed a Memorandum of Understanding (MoU) on co-operation in the facilitation of the investment and financing of infrastructure projects via the Infrastructure Financing Facilitation Office (IFFO) platform.


    With EXIM Bank becoming an IFFO Partner in July this year and the signing of the MoU today, both parties will further strengthen co-operation in multiple areas including exchanging of information and best practices, advancing capacity building and facilitating infrastructure financing transactions, to jointly promote beneficial developments of infrastructure investment and financing in Hong Kong and the Belt and Road Initiative.


    Hong Kong possesses advantages as the largest offshore Renminbi (“RMB”) business centre and international financial centre, EXIM Bank will continue to explore offshore infrastructure investment opportunities through the Hong Kong platform.


    Mr Norman Chan said, “The signing of this MoU marks the beginning of strengthened cooperation between IFFO and EXIM Bank in multiple areas. It reflects our joint commitment to further developing the infrastructure financing market in the region through the Hong Kong platform.”


    Ms Hu Xiaolian remarked, “As a state-owned policy bank that supports international economic cooperation, EXIM Bank has given full play to its advantages as a policy financial institution to support infrastructure development. The Bank is ready to take the signing of the MOU as an opportunity to further deepen cooperation with HKMA and IFFO. By leveraging on the important role of Hong Kong as an international financial centre and IFFO as a platform, the Bank is ready to work with all parties to facilitate infrastructure projects under the Belt and Road Initiative to achieve mutual development.”


    About IFFO
    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:


    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.


    By establishing IFFO, the HKMA can play a valuable role as a catalyst in the facilitation of infrastructure investments and their financings with its mandate to promote Hong Kong as an international financial centre.


    For more information about IFFO, please visit http://www.iffo.org.hk.


    About EXIM Bank
    Founded in 1994, the Export-Import Bank of China is a policy bank under the direct leadership of the State Council. The Bank’s main mandate is to facilitate foreign trade and investment, play a major role in ensuring steady growth, making structural adjustment, supporting foreign trade and implementing the “going global” strategy, and promote the sustainable and sound development of the national economy.



    HKMA Infrastructure Financing Facilitation Office
    Export-Import Bank of China
    20 December 2016

  • Mr Jin Liqun, President of the Asian Infrastructure Investment Bank (AIIB), spoke at a high level business seminar in Hong Kong today (8 November). The seminar, organised by the Infrastructure Financing Facilitation Office (IFFO) of the Hong Kong Monetary Authority (HKMA)…
    AIIB
    AIIB_001
    photo
    08 NOV
    2016

    HKMA Supports AIIB’s use of Hong Kong as a Financing Center

    Mr Jin Liqun, President of the Asian Infrastructure Investment Bank (AIIB), spoke at a high level business seminar in Hong Kong today (8 November). The seminar, organised by the Infrastructure Financing Facilitation Office (IFFO) of the Hong Kong Monetary Authority (HKMA) and entitled “President Jin Liqun on AIIB’s Operations and Projects”, attracted close to 300 industry leaders from various sectors including finance, architecture, building and construction engineering, project management and consulting, project development and operation, as well as professional services.


    President Jin said at the seminar that Hong Kong’s application to become a member of AIIB is progressing well. He said, “We welcome Hong Kong’s application for AIIB membership. Hong Kong, among other applicants, is expected to become a member of AIIB in the coming months. We look forward to new members playing an active role in the Bank.”


    President Jin added that AIIB has plans to issue bonds to support infrastructure financing at an appropriate time. “As a world-class financial centre with a robust business architecture, deep and active capital markets, AIIB will certainly consider Hong Kong’s strengths when it issues bonds.”


    Mr Norman TL Chan, Chief Executive of the HKMA, said, “We welcome the opportunity to collaborate with AIIB in its bond issue. As Hong Kong develops into a key infrastructure financing centre in the region, our businesses and financial institutions look forward to playing an active role in AIIB’s operations and project management and contributing to its further development.”


    The seminar forms part of IFFO’s continued commitment and efforts to promote information exchange and capacity building among the relevant key stakeholders in infrastructure investments and financing in the region.



    Infrastructure Financing Facilitation Office
    Hong Kong Monetary Authority
    8 November 2016

  • Infrastructure Financing Facilitation Office (IFFO) is hosting its first executive workshop co-organised with International Finance Corporation (IFC) and Eastspring Investments on 26-28 October at the Hong Kong Monetary Authority (HKMA)…
    Workshop
    IFFO_Executive_workshop
    26 OCT
    2016

    IFFO hosts the first executive workshop on infrastructure financing
    and announces 13 new partners

    Infrastructure Financing Facilitation Office (IFFO) is hosting its first executive workshop co-organised with International Finance Corporation (IFC) and Eastspring Investments on 26-28 October at the Hong Kong Monetary Authority (HKMA), with the theme of “Private Participation in Infrastructure Project Finance in Emerging Markets”. The objective of the workshop is to kick off IFFO’s capacity building efforts. It is a two-and-a-half day workshop with the first two-day session supported by IFC as the lead organiser, followed by a half-day session arranged by Eastspring Investments as the organiser.


    The workshop falls within the strategic framework under the Memorandum of Understanding (MOU) signed between IFC and the HKMA in July this year. According to the MoU, both parties agree to cooperate to support capacity building with a view to promoting an efficient and conducive market environment for infrastructure financing.


    The workshop is attended by over 20 senior professionals from various organisations including multilateral financial agencies and development banks, commercial banks, asset managers and infrastructure project developers and operators across Mainland China, Hong Kong and overseas (See Annex).


    Vivek Pathak, IFC Director for East Asia and the Pacific, said, “Emerging markets are ripe for investment as many of these countries have a critical need for infrastructure. With serious new players entering this sector, there is a need to execute projects that optimise profits with measurable public good outcomes. Such developments may be realised as Public-Private Partnerships to help economies and populations flourish.”


    Don Kanak, Chairman of Eastspring Investments, who will be speaking on Day 3 of the workshop (October 28, 2016), said, “Asia’s strong economic and population growth, urbanisation and the rise of the middle class generate and call for more infrastructure investment and financing, creating opportunities in the region for long-term investors. Eastspring believes infrastructure as an asset class can deliver a different value proposition to investors. China’s Belt and Road Initiative is addressing the critical needs for infrastructure development in the fastest growing and the neediest countries along the Silk Road and can play a critical role in their future development and supporting global growth and stability. We look forward to sharing our infrastructure team’s experiences and views at the IFFO.”


    With the establishment of IFFO, the HKMA has brought together a strong network of parties interested in supporting the development of infrastructure in Asia and the Belt and Road (B&R) countries. At its launch in July this year, the IFFO platform brought together 41 partners with the shared mission of facilitating infrastructure investments and financing. Today, the IFFO is pleased to announce that 13 more organisations have joined IFFO as partners. They are (in alphabetical order):


    (1) AIA Group Limited
    (2) Allen & Overy
    (3) Aon Hong Kong Limited
    (4) Asian Academy of International Law
    (5) Astana International Financial Centre
    (6) China Export & Credit Insurance Corporation
    (7) China-Britain Business Council
    (8) Citigroup
    (9) King & Wood Mallesons
    (10) Marsh (Hong Kong) Limited
    (11) Mitsubishi Corporation (Hong Kong) Limited
    (12) Mizuho Bank, Ltd.
    (13) Zurich Insurance Company Limited


    Eddie Yue, Director of IFFO and Deputy Chief Executive of the HKMA, said, “The IFFO platform has grown by bringing in partners from the insurance, banking and legal sectors, as well as international business council and corporation. With the addition of the new partners, IFFO is further equipped to deliver on its missions and we look forward to exploring areas of collaboration along the functions of IFFO, information exchange, capacity building, market and product development, and investment facilitation, with a view to facilitating infrastructure investments and financing especially in emerging markets through making use of the Hong Kong platform.”


    About IFFO

    As part of the HKMA, IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders. The functions of IFFO are:

    • providing a platform for information exchange and experience sharing;
    • building capacity and knowledge on infrastructure investments and financing;
    • promoting market and product development; and
    • facilitating infrastructure investment and financing flows.

    For more information about IFFO, please visit http://www.iffo.org.hk.


    About IFC

    IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with 2,000 businesses worldwide, we use our six decades of experience to create opportunity where it’s needed most. In FY16, our long-term investments in developing countries rose to nearly US$19 billion, leveraging our capital, expertise and influence to help the private sector end extreme poverty and boost shared prosperity. For more information, visit http://www.ifc.org.



    About Eastspring Investments

    Eastspring Investments is a leading asset manager in Asia that manages over USD140 billion (as at 30 June 2016) assets on behalf of institutional and retail clients. Operating in Asia since 1994, Eastspring Investments is the Asian asset management business of Prudential plc, an international financial services company (Note 1).


    We provide investment solutions across a broad range of asset classes including: equities, fixed income, global asset allocation, infrastructure and alternatives. Our investment teams are specialists in their respective fields, supported by the global resources made available through our relationship with Prudential plc and are committed to acting in the best interests of our clients and delivering optimal investment outcomes over the long term. For more information, please visit http://www.eastspring.com.



    Infrastructure Financing Facilitation Office, HKMA
    International Finance Corporation
    Eastspring Investments
    26 October 2016



    Note:

    1. Eastspring Investments (excluding JV companies) companies are ultimately wholly-owned / indirect subsidiaries / associate of Prudential plc of the United Kingdom. Eastspring Investments companies (including JV's) and Prudential plc are not affiliated in any manner with Prudential Financial, Inc., a company whose principal place of business is in the United States of America.
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