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SME Worldwide

Hong Kong: Perfect Investment Destination

Rishi Sonwal
Jul 2010

The economists often term Hong Kong, one of the two special administrative regions of the People’s Republic of China, as a fine example of laissez-faire capitalism. It means allowing industries to be free from the state intervention, especially in terms of restrictions like tariffs and government monopolies.

The Government of Hong Kong has very limited role in the financial industry, mostly leaving the direction of the economy to market forces and the private sector. The economy of Hong Kong is dominated by service sector which accounts for 90 per cent of the GDP and country’s largest exports market are mainland China, US and Japan. The Hong Kong economy is being characterized by low taxation, free trade and minimum government intervention.

Hong Kong continues to be Asia's second largest and is the world's seventh largest FDI recipient, attracting US$63 billion inward investment in 2008. This amount represented a 15.9% increase year-on-year despite the global financial and economic crisis that has caused FDI inflows to some developed economies to half. Hong Kong also continues to have the highest FDI stock in the region amounting to nearly US$835.8 billion.

With land mass of 1,104 km (426 sq mi) and a population of seven million people, Hong Kong is one of the most densely populated areas in the world. Hong Kong's population is 95% ethnic Chinese and 5% from other groups.

Invest Hong Kong

The Government of Hong Kong provides various options and opportunities to invest. InvestHK is the department for foreign direct investment, under the policy purview of the Commerce and Economic Development Bureau of the Hong Kong SAR Government. InvestHK is responsible for attracting and facilitating inward investment into the city. It supports overseas, Mainland and Taiwanese companies to set up and expand in Hong Kong.

InvestHK offers free investment promotion, facilitation and aftercare services to ensure that companies have all the support required to establish or expand operations in the dynamic Hong Kong economy. Whether it is information provision, site visits, business matching, or interface with government departments, InvestHK provides comprehensive inward investment support services to prospective and existing foreign investors. All services offered by InvestHK are entirely free of cost.

Areas where Invest Hong Kong can help the organisations include:

Supplying the latest information on Hong Kong's business environment and investment regime, including comprehensive economic sector profiles, business incorporation advice, contacts for different aspects of business including human resources and information on the availability and cost of land, factories, offices and housing.

Delivering government information on funding and other support services for business as well as on taxation, import/export regulations, government projects, employment legislation and immigration requirements.

Identifying and matching potential investors with business partners in Hong Kong. Arranging meetings, site visits and calls on government departments as well as trade and industrial support organisations.

Assisting investors in dealing with government departments on matters such as visa applications, trade mark registration, fire and environmental protection requirements and business incorporation.

PR and buzz creation to celebrate the organization's arrival in Hong Kong

Aftercare services to ensure the operations in Hong Kong continue to bring value to the business.

SME WORLD recently met Andrew Davis, Associate Director General, InvestHK and Rowena Hoy, Head - Consumer Products, InvestHK in New Delhi to know the investment opportunities and scope for Indian SMEs in Hong Kong. Here are excerpts –

How is Hong Kong different in terms of investment as compared to other destinations in Asia and Europe?

There are enough factors which set apart Hong Kong from other Asian countries and European countries. Hong Kong provides world class infrastructure, low and simple taxes, strategic location in the region, gateway to Mainland China, etc. Besides the Government is clean and adopts liberal immigration policies. There is common law legal system underpinned by an independent judiciary. In Hong Kong information access is very easy. Anyone easily can get all the necessary information to operate his business effectively. Also the currency of Hong Kong is freely convertible.

What kind of industries Hong Kong is attracting and which sector has more potential in terms of exports?

The Government of Hong Kong Special Administrative Region has identified six growth industries where Hong Kong enjoys clear business advantages. These are education services, medical services, testing and certification services, environmental industries, innovation and technology, cultural and creative industries. Besides the InvestHK department has also realigned its priority sectors and strengthened its research and aftercare capabilities in order to encompass the six new growth industries where Hong Kong has a clear competitive advantage. The InvestHK has created special teams for the most returning areas in Hong Kong like business and professional services, consumer products, creative industries, financial services, information and communication technology, innovation and technology, tourism and hospitality and transport and logistics.

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1 Comments >>

Johnette

05 Aug 2011 (20:15:58)

Life is short, and this article saved valbulae time on this Earth.

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