We talk to the organisation about its recently acquired status of vice chair of the Hong Kong Limited Partnership Fund Association.

Hong Kong’s drive to reinvigorate its global standing after a painful period will focus on areas such as private equity and encouraging HNW individuals to locate there. A new senior member of a business association in the jurisdiction intends to drive this agenda.

A few days ago, Hywin Wealth announced that its Hong Kong subsidiary, Hywin International, is now vice chair of the Hong Kong Limited Partnership Fund Association. Dr Nick Xiao, Hywin International, will hold the actual post.

As Hong Kong sets about promoting entities such as HK Limited Partnership Funds and other measures, Hywin wants to be at the forefront of encouraging change, Dr Xiao told WealthBriefingAsia in a recent call. 

“Hywin was most pleased to join the leadership group of HKLPFA and help shape the agenda of one of the most important industry associations in Greater China. HKLPFA is the advocate, incubator, and coach for LPF managers and LPF funds,” he continued. “Hywin as the super-connector between Asia wealth and global assets is applauded for bringing new perspectives to the association.”

The moves come at a time when Hong Kong is competing against rival hubs such as Singapore and Dubai. In Singapore, for example, the city-state has rolled out a Variable Capital Company (VCC) regime, and revamped laws to encourage family offices to locate there. Dubai, meanwhile, recently unveiled a new programme to encourage family offices to set up in the Gulf.

After a number of challenges and the pain of the zero-Covid policies and strict enforcement of quarantine rules, Hong Kong’s international profile was hit, but this is a resilient place. 

“Hong Kong, as a hub of global wealth and capital, has faced some challenges in the past four years…Industry players like us, we rallied to support it, and have done this since 2019,” Dr Xiao said. 

Dr Xiao said the HK Limited Partnership Fund is “one of the major breakthroughs in Hong Kong’s aspiration to be the hub of global alternatives.”

“Hong Kong has a tremendous pool of [assets under management] AuM, a myriad of financial institutions and asset managers, and a vibrant stock market. It’s only natural that a locally-domiciled private equity industry should rise to connect global LPs and Asia opportunities,” he said. 

In 2019, Hong Kong put a focus on building up the local family offices sector, as the magnet attracting global entrepreneurs, capital, investing and innovation activities to HK. In 2021, Hong Kong expanded its emphasis to encouraging a domestic private equity and venture capital business, seeking to make Hong Kong one of the global hubs for the industry. 

Dr Xiao thinks that the family office and LPF are two coordinated, complimentary initiatives. Whilst the family offices bring entrepreneurs and rainmakers to Hong Kong and plug them into the Greater China financial eco-system, the LPF regime helps them operate and govern their investing processes, with the entailed advantages in structuring, taxation, reporting, and LP access, he said.

There are already more than 100 members in the association, and more than 500 LPFs set up in the past two years. 

Hywin as vice chair will actively champion new initiatives and participate in the dialogues between the Hong Kong Limited Partnership Fund Association and the wider financial communities, governments and regulators, and global investors. The association expects Hywin to take the intellectual lead in broadening the interface between LPFs and the private banking industry. Hywin said it will also fly the LPF flag at its scheduled global events across North America, Europe, the Middle East and Asia, to spread the gospel of HKLPF as the “fund regime of the future” and Hong Kong as “home of the next generation of world-beating private equity managers.”