The Government of HKSAR abides by the principle of keeping intervention into the way in which the market operates to a minimum and has endeavoured to provide a favourable environment in which business operates. In addition, its policy of low taxation allows room for maximum business initiatives and innovation. There are no exchange controls, no restrictions on capital flows, etc. Therefore HK has been ranked first in terms of economic freedom. With these qualities and more, HK has many advantages in order to be a good quality IFC.
On the other hand, Singapore's financial services have not been weak either in Asia. In the 1970s, Singapore significantly increased its presence as an IFC through government incentives that included encouraging the Asia dollar market. In particular since the Asian Financial Crisis, their position as an IFC, has gradually climbed upwards. Throughout the years, they have strengthened their banking sector, while maintaining confidence and stability in the financial system in order to increase their power in competition. .
Both countries, with a strong financial sector and an strong economic structure seems to have more than enough qualities to be the most prominent market places for International financial trading, as there are backed up by many advantages of both internal and external factors. The main advantage would have to be their geographical location, even better with HK; it had a century of tradition as a major trading entrepot because of its harbour facilities and its geographical location off the coast of China, which is currently the fastest and most potential growing economy of the world. Apart from their location, they also have a time zone advantageous position allowing them to attract transactions in various forms of market. These markets range from money, capital, foreign exchange, gold and commodity market. Meanwhile, HK established the Hang Send Index Market and Singapore set up the Asian Dollar and Bond Market.
