Hong Kong: Ideal Place for Business
Economy of Hong Kong
Being a free market, Hong Kong is apparently dependent on international trade. Though natural resources are inadequate, food and raw materials must be gained from imports. Gross imports and exports (i.e., including re-exports to and from third countries) each exceed GDP in dollar value. Even before Hong Kong reverted to Chinese administration on 1 July 1997, it had extensive trade and investment ties with China. Hong Kong has been further integrating its economy with China because China’s growing openness to the world economy has made manufacturing in China much more cost effective. Hong Kong’s re-export business to and from China is a major driver of growth. Per capita GDP is comparable to that of the four big economies of Western Europe. GDP growth averaged a strong 5% from 1989 to 2005, but Hong Kong suffered two recessions in the past eight years because of the Asian financial crisis in 1997-1998 and the global downturn in 2001-2002. Although the Severe Acute Respiratory Syndrome (SARS) outbreak also battered Hong Kong’s economy, a solid rise in exports, a boom in tourism from the mainland because of China’s easing of travel restrictions, and a return of consumer confidence resulted in the resumption of strong growth from late 2003 through 2005 ().
The government interfered in the stock, futures, and currency markets in August 1998 to ward off manipulators. With the intervention, banking sector in Hong Kong remains solid, and the government is dedicated to the U.S. – Hong Kong dollar link.
Victoria Harbor gave way to the rapid development of foreign trade. It serves as the bridge to Hong Kong’s principal trading partners – Mainland China, the United States, Japan, Taiwan, Germany, Singapore, and South Korea.
Because of its strong manufacturing division, Hong Kong enjoyed economic growth in the past years but recently the service sector has exceeded it in importance and accounts for 85% of GDP. Its major components of service trade are shipping, civil aviation, tourism, and various financial services. Additionally, Hong Kong has one of the world’s most sophisticated telecommunications and information technology infrastructures making Hong Kong as a major regional and international financial and commercial center.
Economy and Foreign Investments
Hong Kong gives confidence to free enterprises and a free trade economy. There is no government distinction as to the local and foreign companies consequently welcome investment from both.
The Basic Law (which is the highest constitutional law of Hong Kong) provides that Hong Kong can enjoy a high degree of autonomy as a Special Administrative Region (SAR) of the People’s Republic of China. Hong Kong’s social and economic systems, as well as its lifestyles, would remain unchanged for 50 years after the handling over in 1997, and China’s socialist system and policies are NOT to be practiced in the SAR.
Hong Kong lies in the advantage of having the least controlled economies in the world. Ranked as the world’s 10th largest trading entity and 11th largest baking center, Hong Kong is additionally duty-free. The number of consulates located in the region revealed a dominant presence of international trade. Hong Kong had more consulates and consulates-general than any other city in the world. Even the busiest City (New York) has lesser consulates than Hong Kong. Moreover, Hong Kong is astoundingly higher than Japan in terms of per capita GDP (PPP). And with this, Hong Kong is one of the richest territorial regions in Asia.
Hong Kong Lifestyle
Food & Drinks
Hong Kong is one the great centers for international cooking. Apart from Chinese food, which is excellent, there are also many Indian, Vietnamese, Filipino, Singapore/Malaysian and Thai restaurants. It is the home of authentic Chinese food from all the regions of China, which may be sampled on a sampan in Causeway Bay, on a floating restaurant at Aberdeen, in a Kowloon restaurant, in a street market or at a deluxe hotel. Hotels serve European and Chinese food but there are also restaurants serving every type of local cuisine. Specialities include Dim Sum (savory snacks, usually steamed and served in bamboo baskets on trolleys).
Nightlife
There are many nightclubs, discotheques, hostess clubs, theatres and cinemas. Cultural concerts, plays and exhibitions can be seen at Hong Kong’s City Hall which also has a dining room, ballroom and cocktail lounge.
Shopping
Whether one is shopping in modern air-conditioned arcades or more traditional street markets, the range of goods available in Hong Kong is vast. Many famous-name shops have opened in Hong Kong, bringing the latest styles in great variety. Places that display the HKTA sign (Hong Kong Tourist Association) are the best guarantee of satisfaction. Bargaining is practiced in the smaller shops and side stalls only ().
Investing Agencies in Hong Kong
Being open to foreign trade and to the world market, Hong Kong investors congregate in the place for their business to grow and have indeed been growing. There are currently 60 local and foreign companies in Hong Kong, 15 banks and 11 Transportation companies.
Why Invest in Hong Kong?
Hong Kong which reverted to Chinese rule in 1997 remains a vibrant economy with a relatively high standard of living. Although the population is small, businessmen and women are used to western business practices and competition is intense. New products can and do gain market share very quickly in Hong Kong.
Hong Kong is a gateway to Chinese Market. Many businesses in Hong Kong have their manufacturing in Guandong province. Hong Kong’s strengths are in high-tech sectors and well capitalized banking sector.
Hong Kong named ‘Asian City of the Future’ by Magazine
Hong Kong was selected as the Overall Winner “Asian City of the Future 2005/6″ in a competition organized by the fDi (ForeignDirectInvestment) magazine, which is part of the Financial Times Business group. The results are announced and detailed in the magazine’s December 2005/January 2006 issue.
fDi invited investment promotion agencies, development authorities and national and regional governments to submit applications. There were more than 60 entries. HK’s entry was submitted by InvestHK. The panel of judges was comprised of fDi’s editorial team and business executives based in the Asia Pacific region.
Hong Kong was the winner of 4 of the 7 categories: Best Transport; Best IT & Telecommunications; Best Quality of Life; Best FDI Potential. Hong Kong was also the runner-up in the Best Human Resources category ().
Hong Kong ranked as the world’s freest economy for the 12th consecutive year
Hong Kong retains its position as the freest economy in the world for the 12th consecutive year; that is every year since the Index of Economic Freedom was first published in 1995. The score of Hong Kong improved from 2005 due to the city attaining better scores in respect of “government intervention in the economy” and “fiscal burden of government”. Hong Kong’s scores for all the other eight factors remain unchanged. Hong Kong was ranked first in six broad factors, namely trade, monetary policy, foreign investment, banking finance, property rights, and regulation.
Credit:ivythesis.typepad.com
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