Group 1: Economic Development Strategies - The 2025 Policy Address aims to enhance Hong Kong's status as an international financial center, focusing on offshore RMB business, fintech innovation, and green finance[3] - Hong Kong is the largest offshore RMB market, with an average daily trading volume of USD 196.5 billion in October 2024 and RMB deposits totaling approximately RMB 938.23 billion by July 2025[8] - The asset management sector in Hong Kong grew by 13% in 2024, reaching HKD 35.1 trillion (approximately USD 4.51 trillion)[14] Group 2: Infrastructure and Connectivity - The Northern Metropolis development plan includes establishing a dedicated committee and legislative framework to accelerate infrastructure projects, with a focus on cross-border connectivity[30] - The Hong Kong International Airport is projected to handle 120 million passengers and 10 million tons of cargo by 2035, enhancing its position as a global aviation hub[25] - The report emphasizes the establishment of a "super contact" role for Hong Kong, facilitating connections between mainland enterprises and international markets[34] Group 3: Social Welfare and Housing - The government plans to build 189,000 public housing units over five years, including 30,000 "simple public housing" units by the end of 2025[41] - Measures to support small and medium-sized enterprises (SMEs) include extending the loan guarantee scheme and reducing operational costs through fee waivers[44] - Initiatives to enhance social welfare include increased support for elderly care and family services, with a focus on encouraging childbirth through tax incentives and childcare services[46]

Investment Rating - The industry investment rating is "Recommended," indicating an expected increase in the industry index by more than 5% over the next 3-6 months compared to the benchmark index [18]. Core Insights - The "Policy Declaration 2.0" aims to establish Hong Kong as a global innovation center for digital assets, building on the initiatives from the first declaration in October 2022 [2]. - The declaration introduces the "LEAP" framework, focusing on optimizing legal and regulatory frameworks, expanding tokenized product varieties, promoting application scenarios and cross-sector collaboration, and developing talent and partnerships [2][3][4]. - The framework emphasizes the establishment of a comprehensive regulatory framework for digital asset service providers, including trading platforms and custodians, with the Hong Kong Securities and Futures Commission as the main regulatory body [2]. - The declaration encourages the tokenization of a wider range of assets and financial instruments, including government bonds and traditional financial products, to stimulate innovation [2][4]. - The report highlights the importance of linking financial tools with the real economy, suggesting that the development of the RWA (Real World Asset) market in Hong Kong is a key focus area [4]. Summary by Sections Legal and Regulatory Optimization - Establish a unified regulatory framework for digital asset service providers, including trading platforms and custodians [2]. - The Hong Kong Securities and Futures Commission will oversee the licensing mechanism for digital asset service providers [2]. Expansion of Tokenized Products - Promote the tokenization of various assets and financial instruments, including government bonds and traditional financial products [2][4]. - Encourage innovative applications through projects like the HKMA's Ensemble project [2]. Application Scenarios and Cross-Sector Collaboration - Support the development of digital asset infrastructure and provide funding for impactful projects through initiatives like the Digital Port's blockchain pilot funding scheme [3]. Talent and Partnership Development - Invest in professional talent development and infrastructure to enhance the financial system's service capabilities abroad [4]. - Address the mismatch between trade and financial status in the context of Chinese enterprises going global [4]. Investment Recommendations - The report suggests tracking the progress of Hong Kong's Web 3.0 development and the entry of significant financial institutions into the digital asset ecosystem [6]. - Recommended stocks include Nanhua Futures, Ruida Futures, Tianfeng Securities, and Guangfa Securities for A-shares, and ZhongAn Online, Lianyi Technology for Hong Kong stocks [6].