David Webb expects the peg system to maintain

Legendary activist investor David Webb remains cautiously optimistic about Hong Kong’s outlook and expects the peg of local currency to US dollar to stay unchanged.

Webb, who earlier revealed that his life is counting down, participated in a farewell fireside chat organized by the Foreign Correspondents' Club of Hong Kong today.

He was cautiously optimistic about the outlook for Hong Kong's capital markets, saying that the Connect Schemes linking mainland’s and the city’s markets have created unique value for the SAR. 

“As innovative companies become a regular feature of Hong Kong listings, and financial products continue to be enriched, the opportunities will once again emerge,” Webb said.

Floating exchange rate ‘disastrous’ for HK

Despite the short-term challenges, Webb noted that Hong Kong has always had three irreplaceable advantages, including a sound financial infrastructure, a pool of talent and an open market. 

Regarding the linked exchange rate system, he believes that the system established in 1983 will continue to exist because the government hates change, and said that the floating exchange rate system would be a disaster for Hong Kong's externally oriented economy, and the Hong Kong dollar is essentially a “temporary certificate for exchanging US dollars”.

Lion Rock Spirit not ‘bailout’

Asked whether Hong Kong’s Lion Rock spirit still exists, Webb said it should be the spirit of self-reliant entrepreneurship, not the inertia of waiting for government bailout, and considered that the essence of city’s golden age lies in “opportunity economy” and “self-improvement”, rather than the current spreading mentality of dependence. 

At the same time, he criticized the current multi-billion dollar loan guarantee policy for SMEs as “irrigating weeds”, which distorts the market elimination mechanism.

Webb-site remains open

Earlier, Webb decided to shut down the Webb-site database in an orderly manner and upload the database, which covers the governance records of Hong Kong listed companies over the past decades, to a public repository. 

He said instead of letting the disease decide the end point he should take control of the way to end the story, reaffirming that the closure is not the same as disappearing, and that the data repository to be uploaded to the public repository on May 1 will contain all the database backups and operational codes of the site, which will be made available to the public under a Creative Commons License.

After handing over this professional legacy, he said, data scientists, non-profit organizations and even regulators will be free to use it, “They can run it commercially, but I'm looking forward to someone continuing the tradition of free public access.” 

He highlighted the fact that maintenance costs are actually extremely low, “just one server”, and suggested combining artificial intelligence technology to optimize the data entry process, solving the pain point of relying on manual processing of company announcements in the past.

STAFF REPORTER