The Government of Hong Kong is prepping up to take a stance on artificial intelligence in finance – initiating field uses of AI in relevant subjects including trading, investment banking, and cryptocurrency. Officials are likely to give a statement in late October when Fintech Week would be carried out.
The Financial Services and Treasury Bureau of Hong Kong is set to provide guidelines for ethical use of AI and general application in finance, while documents are being drafted and prone to further adjustment based on the industry’s feedback – an indicator of Hong Kong’s support for AI.
Hong Kong, being in the middle of technological fray between the United States and China, has its local lawmakers attempt to clarify the uncertainty around AI, while many companies and consumers still find ChatGPT or Gemini inaccessible at times as US technocrats fear conflicts arising in the Chinese territory – made evident by the unavailability of American services such as OpenAI, Anthropic or Google, while Chinese Baidu and ByteDance are verging on impossibility of use.
Given the influence from Beijing keeps growing, so too does foreign investors’ anxiety. Singapore and the rest of Southeast Asia, being vanguards of fintech and AI development, have become a considerable option.
As Hong Kong seeks to become a financial center, a spokesperson for the Financial Services and Treasury Bureau explained that their government is “closely monitoring market developments and global experiences to promote the responsible use of AI in the financial industry.”
Last year, the Securities and Futures Commission revised its regulations regarding the utilization of external data storage providers, to include both public and private cloud services, as well as virtual and physical data centers
In August, the Hong Kong Monetary Authority, in collaboration with Cyberport, a technology hub backed by the government, instigated a regulatory sandbox for banks to test the new Gen AI, although the permission for real-world use has not been clear. The forthcoming AI guidelines are expected to provide centralized rules.
Meanwhile, Wall Street speculates on how AI could affect operations run by financial firms – banks have been recruiting AI professionals on a global scale, employing related technology to accomplish tasks such as portfolio examination or determination of potential defaults.
The declaration of commitment by the Hong Kong authority suggested that regulators will favor the application of AI and later prescribe more enforceable rules, given the foreshadowed statement on such policy would only provide general direction not yet statutory.
Further, the statement also aims for detailed consolidation of numerous instructions from each banking and securities regulator, being independent of Hong Kong’s Innovation, Technology and Industry Bureau who will concentrate on the development of AI tools.
