Hong Kong’s de facto sovereign wealth fund is considering using HK$5 billion ($639 million) it set aside for its GBA Investment Fund to set up a joint investment fund with the government of Guangdong to invest in Greater Bay Area projects, the city said on Wednesday.
Financial details, such as the size of the fund, were not disclosed.
The former British colony’s chief executive, John Lee, took to the stage on Wednesday for his second annual policy address, where he presented a raft of measures including ones to draw foreign talent and companies to set up or expand their operations in the city, plotting for Hong Kong’s comeback as a financial hub.
Lee said other institutions or corporations would also be considered to set up the fund alongside, without going into further detail. The investments would be targeted at “GBA projects with social and economic benefits”, he added.
A year ago at his maiden policy address, Lee announced establishing the Hong Kong Investment Corporation (HKIC) to optimise the use of the government’s financial reserves for promoting industrial and economic development, regarded as the special administrative region’s parallel to Singapore’s Temasek.
Incorporated in 1974, Temasek owns a $287-billion portfolio, mainly in Singapore and the rest of Asia. Most of the government-owned investment company’s investments lie in unlisted assets and funds. Temasek has been a long-time investor in private companies as well as venture capital and private equity funds.
Earlier this month, HKIC named Clara Chan as its new chief executive officer, who left her post as executive director of monetary management at Hong Kong’s central bank after nearly 13 years to head the investment fund.
The HK$62-billion ($7.9 billion) pool of capital HKIC manages includes the Hong Kong Growth Portfolio, Strategic Tech Fund, Greater Bay Area Investment Fund, and a Co-Investment Fund.
It has already made several investments, including allotting cheques to fund managers across venture capital, private equity, and buyout spaces, DealStreetAsia reported in July.
The wholly-owned government investment fund is expected to double down on more investments in the fintech, artificial intelligence, biotechnology, and advanced manufacturing sectors by the end of the year, per media reports.