Despite Hong Kong’s anomalous status as a Chinese city under British colonial rule until 1997, its historical experience is of major interest in any review of Asia’s development in the last 50 years. Hong Kong has long possessed an independent, sophisticated, and international fi nancial system and has been among Asia’s top three fi nancial centers for almost a century. It has been China’s largest single source of external fi nance since the nation embarked on the economic reforms that generated an annual GDP growth rate of 9.8% between 1978 and 2007. Hong Kong’s prosperity has come to depend increasingly on the effi ciency of its fi nancial services sector because since the 1980s, the economy has switched from exporting light industrial products to reliance on the services sector, which now accounts for 93% of GDP.