darryl chan : opening remarks - treasury markets summit 2024 opening remarks by mr darryl chan, deputy chief executive of the hong kong monetary authority, at the treasury markets summit 2024, hong kong, 27 september 2024. * * * distinguished guests, members and friends of the tma, ladies and gentlemen : good morning. on behalf of the hkma and the tma, a very warm welcome to you all for joining this annual treasury markets summit. the annual event has been, and will continue to be, a great gathering that promotes the sharing of thoughts, ideas and friendship among professionals from the treasury markets and experts from related disciplines. i'd like to congratulate the tma team on curating a highly relevant and interesting programme for this year's summit. special thanks to our panellists who will generously share their insights and foresights on subjects that are so closely related to our day - today work such as china's economic outlook, and subjects that will or may have profound impact on the way financial markets including the treasury markets operate a€ “ here i am referring to cbdc and defi. and, speaking of china's economic outlook, these past couple of days were extraordinary. i am sure we can't wait to hear the sharing by our experts. and of course we also look forward to hearing what eddie has to say about offshore rmb business, a topic that i'm sure concerns almost every one of us here today, and a topic that is hugely important to sharpening the edge of hong kong as an international financial centre. but before we embark on the forward - looking journey, let me take a few minutes to highlight a number of remarkable achievements by the tma in the past year or so. in terms of market infrastructure, the tma's dedicated working group has done a wonderful job in helping market practitioners prepare for the smooth transition of libor to alternative reference rates and facilitating the adoption of hong kong dollar overnight index average, or honia, as an alternative to hibor. no fanfare, but the silence spoke volumes about the hard work behind the scenes. on the introduction this week of severe weather trading in our stock market, the tma has reviewed the arrangements of the financial benchmarks it administers and undertook to continue publishing hkd and cnh fx spot rates during severe weather conditions, facilitating the implementation of the new trading arrangement. the tma also actively provides market perspectives and advice in support of the development of

of these working groups, called the platform carbon accounting financials, or pcaf, has developed a methodology on how to measure the carbon footprint of six different asset classes. they will launch this report soon. another working group has worked on sdg impact measurement. it developed, and recently launched its report, and i ’ m very proud that they ’ re here. so we ’ ve been quite active as you can see. and as a central bank and prudential supervisor, we ’ re actually rather proud of all the work we ’ ve done. and we ’ d even dare to say that we are among the frontrunners in europe and perhaps even worldwide. a critical look at all initiatives … but if you take a closer look at the things we ’ ve done, perhaps we can also be a bit more critical. so far, most of our work is focused on climate - related risks. we ’ ve looked at how the energy transition could impact the economy, we ’ ve looked at how the financial sector is at risk from climate change and the energy transition. so if we ’ re a bit critical, from our supervisory mandate we ’ re mostly just focusing on climate risks. but isn ’ t climate just one of the sdgs? aren ’ t there 16 other sdgs? and couldn ’ t each of these sdgs have physical or transition risks for our economy and therefore for our financial sector? let ’ s take a look for example at sdg # 15, life on land. every year we gain 3. 5 billion hectares of desert. and every year we lose 13 million hectares of forest. biodiversity is also declining at an alarming pace. a recent study done in germany showed that the average insect population has declines with 75 % in the last 30 years. if governments don ’ t take action to stop the loss of biodiversity, this might for example one day lead to crop failures. and this might not happen slowly, but could perhaps be caused when we reach certain tipping points. if that were to happen, obviously, one of our basic human needs would be jeopardized. but from a financial point of view, agricultural companies might face difficulties, and that might impact banks financing the agriculture sector. and so it might not be too far reaching a thought that is would seem important for such a bank to be aware of potential risks from biodiversity loss. or what about sdg # 12, sustainable consumption and production? about making sure that we use all natural resources in a