Ten global partners of Alibaba beat the gong during the company's listing on the Hong Kong Exchanges and Clearing Market on November 26, 2019.

Hong Kong has been engulfed in anti-government protests for months, but the city's capital markets have remained an important gateway between China and the world, according to an industry association.

That's despite China ramping up efforts to open up its financial sector to foreign investors, said Mark Austen, chief executive at Asia Securities Industry and Financial Markets Association, or Asifma. China has recently announced its plans to scrap limits on foreign stakes and quotas for foreign securities investment.

"China needs to move from an over reliance on bank lending to one where they have a dynamic, liquid capital market to fund their economic growth going forward," Austen told CNBC's "Squawk Box Asia" on Friday.

"But we still see Hong Kong as being that conduit to enter and exit China in the medium term because it's really the only option that exists for China to connect to the outside world," he added.