(Bloomberg) — Hong Kong has outlined its first policy guidelines specifically for the use of AI in finance and introduced tax breaks for virtual assets, as part of an effort to elevate itself as Asia’s business center.
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Government officials on Monday touted a common framework that would allow various regulators to develop policies governing the use of AI, seen as key to the future of finance and other sectors. He also proposed extending tax breaks on ownership of digital assets such as cryptocurrencies, pledging to introduce legislation by the end of the year.
Hong Kong is keen to enhance its position as Asia’s go-to financial services hub. The company hopes to bring back investors who have fled the city’s markets in the face of rising U.S.-China tensions, while leveraging next-generation technologies from cryptocurrencies to AI.
“Hong Kong’s financial sector has what it takes to accelerate AI adoption: a huge market and rich scenarios,” said Financial Services Secretary and Treasury Secretary Christopher Hui at the city’s annual He made the remarks in a keynote speech at FinTech Week, a major industry event.
Bloomberg News previously reported on the planned AI policy announcement. Hui said on Monday that the city recognizes the unique risks and opportunities posed by AI and will take a dual-track approach to fostering development while addressing the challenges. Banking, securities, pension, insurance and auditing regulators will issue their own circulars on AI regulation in the financial sector in the future, Hui added.
Hong Kong’s move comes as governments, businesses and consumers around the world grapple with the potential of AI. One complicating factor is that the city is at the center of a growing technology dispute between the United States and China.
Many consumers in Hong Kong do not have easy access to some of the most popular AI services, such as OpenAI’s ChatGPT and Google’s Gemini. This is because the US tech giant does not make these services available locally. Meanwhile, accessing services from Baidu Inc. and ByteDance Ltd. in China is complicated or impossible. City governments sought to address this challenge by developing their own AI.
Financial companies around the world are also considering how AI can reshape their operations. Banks are advertising to attract AI talent and using new technology for everything from studying customer portfolios to finding potential defaulters.
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