Hong Kong Continues to Attract Business Interest

Results from two government surveys revealed in October 2019, have shown that Hong Kong continues to attract overseas and Mainland investment. In a joint survey conducted by Invest Hong Kong (InvestHK) and the Census and Statistics Department (C&SD) the number of business operations in Hong Kong with parent companies overseas and in Mainland China was 9,040 in 2019, cited by the Director-General of Investment Promotion, Mr Stephen Phillips, as representing a 9.9% increase over the 2017 figure. The number of start-ups in Hong Kong was found to have risen by 42.8% over the 2017 figure in a separate survey conducted by InvestHK. 

“Despite global uncertainties, I am confident that Hong Kong’s enduring business advantages such as its strategic position in the region as well as its international status as a sophisticated business and financial city will continue to attract world-class investment. The Guangdong-Hong Kong-Macao Greater Bay Area development and the Belt and Road Initiative will also bring new opportunities,” Mr Phillips said.

People engaged by the overseas and Mainland companies was 493,000, compared to 443,000 in 2017, an increase of 11.3%. In terms of origin, Mainland China ranked the first with 1,799 companies, followed by Japan (1,413), the US (1,344), the UK (713) and Singapore (446).

Favourable factors for Hong Kong as a location included “simple tax system and low tax rate” (71%), “free flow of information” (63%), “geographical location” (61%) and “free port status” (59%).  

In addition, the 2019 Annual Startup Survey found that there were 3,184 start-ups operating in major public and private co-work spaces and incubators in Hong Kong, up 42.8% from 2,229 in 2017. These start-ups employed over 1,400 persons, an increase of 97.4% over the 2017 figure. 

The start-up community was highly international. Of the founders, 34% were from outside Hong Kong, of whom the US had the largest share (15.4%), followed by Mainland China (14.0%), the UK (12.5%), France (7%) and Australia (6.3%). Major sectors of start-ups included “Fintech” (14.3%), “E-commerce, supply chain management and logistics technology” (10.7%), “Information, computer and technology” (10.1%), “Design” (9.5%) and “Professional and consultancy services” (9.0%).

Mr Phillips said that the social unrest in Hong Kong in recent months has had a dampening effect on investment sentiment. InvestHK will devote more efforts to carrying out promotional work, particularly in strategic markets, to deepen investors’ understanding of Hong Kong, rebuild their confidence and promote the city’s crucial functions in the Guangdong-Hong Kong-Macao Greater Bay Area development and the Belt and Road Initiative.