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Ensuring continuous and effective operation of our financial market amid anti-epidemic work

The COVID-19 epidemic situation has further deteriorated over the past week. Due to the large number of infections and people quarantined, various service sectors are facing manpower shortage. Many merchants and restaurants have shortened their operating time or even suspended their businesses. Public transport operators are also cutting their services. Many enterprises are facing extremely difficult situations and breadwinners are also under pressure. Curbing the epidemic as soon as possible with our all-out effort is not only crucial to the lives and health of our citizens, but also people’s livelihood as well as economic and social stability. At this exceptional time, we must curb the epidemic promptly by taking all means, deploying all resources and adopting every necessary measure. The SAR Government is proactively planning for the Compulsory Universal Testing scheme within this month, with a view to achieving the goal of dynamic “zero infection”.

It is always important to ensure stable food supply and smooth operation of key public services in Hong Kong, no matter during the course in curbing the epidemic or at the stage of post-epidemic recovery. Thanks to the guidance and support of the Central Government, and the staunch support and coordination of different Mainland authorities and local governments, the supply of fresh food and vegetables to Hong Kong has remained stable and sufficient. I would also like to express my gratitude to colleagues from different Government bureaux and departments for their effort in sustaining the provision of various essential public services. In the front of financial market, we have already formulated contingency plans for different scenarios and conducted a review and update lately, with a view to ensuring the normal, smooth and effective operation of services such as transactions, operations, clearings and settlements of our major financial market infrastructure, despite any possible changes brought by the epidemic or anti-epidemic works.

Indeed in as early as 2019 when Hong Kong was experiencing riots, I coordinated relevant bureaux and departments, financial regulators, major financial services operators and their senior management in formulating a “business continuity plan”, with a view to ensuring that cross-market and cross-agency real-time contingency plans and communication channels are in place even if the financial market is under sudden interference. The plan has been updated taking into account the development of internal and external environments so as to cope with volatile situations and challenges.

Some of the scenarios covered in the plan include that when travel is blocked or restricted in the city, the whole financial system (including financial infrastructure, major systems and platforms, and major financial institutions) could readily switch to the backup hybrid mode to ensure continuous normal operation of the system, with only about 10 to 20% of the workforce working in the office. As such, even if travel is blocked or restricted for whatever reasons in Hong Kong, our financial market will continue to open, while markets of stocks, derivatives, bonds, currencies and foreign exchanges could operate and carry out transactions as usual. As an international financial centre, many transactions and settlements in Hong Kong are conducted through electronic means. Our banking system handles an average of more than HK$ 3 trillion of clearings every day. Moreover, as a hub for international capital flows, Hong Kong is also supporting a massive amount of transactions of financial and non-financial products across markets. These businesses and clearing services are highly interconnected and interdependent. Therefore, the “business continuity plan" enables different participants, stakeholders, financial institutions and regulators across the market to fully understand how normal services, smooth communication and coordination, and normal transactions and settlements could be maintained when the backup plan is activated. In addition, many international financial institutions have based their headquarters of the Asia-Pacific region in Hong Kong to manage businesses in the whole region. By preparing the "business continuity plan" well and drawing up contingency plan for extreme scenarios, it could help maintain the confidence of the management staff of international institutions as well as investors. In fact, many institutions have already put in place contingency plans in response to the anti-epidemic measures. As such, even if social distancing measures are tightened or travel is restricted, our financial market will operate as usual.

As for retail banking services, some branches of banks have to close temporarily due to the epidemic situation and their services are affected. Nonetheless, generally speaking the banks can still meet the needs of people. Moreover, the Consumption Voucher Scheme launched last year has promoted the wider use of e-payment by citizens and merchants, reducing the use of cash and helping prevent the spread of virus. Many financial institutions are actively encouraging their employees to get vaccinated and booster shots. Different parts of the financial market are actively supporting the anti-epidemic work and contributing their part for Hong Kong at this critical time.

We are still fighting a tough battle against the virus. Nonetheless, with the guidance and support of the central authorities, our anti-epidemic capacity, facilities, resources and manpower have been greatly enhanced and we are much more confident. The SAR Government has strengthened the measures in curbing the epidemic and people have also raised their anti-epidemic awareness. I am confident that Hong Kong will surely win this battle against the epidemic.

March 6, 2022