Breaking News
Investing Pro 0
Free Webinar - Crude Oil Trading 2023 | Thursday, February 9, 2023 | 01:00PM PST Enroll Now

Glum Hong Kong dealmakers pin hopes on China Congress to revive economy, IPOs

Economy Oct 13, 2022 05:31AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: People walk past a screen displaying the Hang Seng stock index outside Hong Kong Exchanges, in Hong Kong, China July 19, 2022. REUTERS/Lam Yik

By Scott Murdoch

HONG KONG (Reuters) -Hong Kong dealmakers expect China's 20th Party Congress next week to herald a shift in focus in Beijing back towards business and economic issues that could help revive the city's IPO issuance from nine-year lows.

Rolling COVID-19 lockdowns have been blamed for dramatically slowing China's economic growth, shutting it off from the rest of the world and denting investors' appetite to buy into Chinese assets.

Any shift towards opening China's borders and stimulating demand there would prop up confidence and business transactions, lawyers and analysts said. Hong Kong only recently began its own reopening, relaxing its tough virus policies which have tarnished its credentials as a global financial centre.

"Hopefully, the global economic situation will improve next year and I expect to see a greater focus on business and economic issues in China after the 20th party congress," said Richard Wang, Freshfields partner in Hong Kong, adding that should lead to more companies looking to raise capital.

Initial public offering (IPO) activity in Hong Kong, which is traditionally dominated by mainland companies, has fallen to a nine-year low amid tumbling Chinese markets, escalating Sino-U.S. tensions and a tightening regulatory environment in China.

International listing ambitions have been put on ice since China flagged new rules, which are yet to be finalised, for companies wanting to sell shares outside of the mainland markets.

There has been just $9.28 billion worth of IPOs in Hong Kong this year, down from $37.1 billion in the same period in 2021, according to Refinitiv figures. The value of new share sales is the lowest since 2013.

Moreover, more than 80% of the IPOs in Hong Kong this year are trading under water since their debut, according to Dealogic data.

Mainland Chinese IPOs have raised $54.12 billion, down 33% from $80.89 billion in the first three quarters of 2022, according to Refinitiv data. However, Shanghai's STAR and the Shenzhen exchange are the two most active IPO markets in the world, the data showed.

"People are expecting that things will open up after the meeting but in terms of timing when you will see that, it will not be an overnight change," said Stephanie Tang, a partner at law firm Hogan Lovells.

"How that will evolve, there's no one determining factor but the reasonable expectation is that we will see deal activity progress from late 2022 towards the springtime in 2023."

Most economists, however, doubt Chinese policymakers will offer any concrete signals soon of a relaxation of the zero COVID policy or a roadmap for border reopening.

COVID infections are at the highest level since August and there's an estimated 36 cities under lockdown or some form of control ahead of the meeting beginning on Sunday.

Greater policy certainty in areas such as technology and education could only become clear following the annual two sessions of China's parliament in March, lawyers said.

Glum Hong Kong dealmakers pin hopes on China Congress to revive economy, IPOs

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your profile, will be public on and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email