Advantages of Investing Hong Kong
Gateway to China
Hong Kong is blessed with an invaluable natural resource: its geographical location. Flanking the mouth of the Pearl River Delta (PRD), Hong Kong is perfectly situated for trade with Mainland China; the whole country is our natural hinterland.
For more than a century and a half, Hong Kong has served as the gateway to Mainland China. There is nowhere better than Hong Kong to obtain the expertise, information and facilities needed to tap into the immense Mainland Chinese market.
China's entry to the World Trade Organisation and development of increasingly competitive industries has set the stage for even greater economic expansion.
The Closer Economic Partnership Arrangement (CEPA), which took effect at the beginning of 2004, provides Hong Kong with additional and exclusive Mainland market access benefits.
The marriage of Hong Kong's world class financial, marketing and technical expertise and sophisticated infrastructure with the mainland's rapidly developing manufacturing and services base has created a win-win situation. Mainland China is now Hong Kong's largest trading partner. Thousands of international companies involved in China trade have chosen to establish their beachhead in Hong Kong.
Hong Kong taxes are among the lowest in the world, and our tax regime is simple and predictable.
The Profits tax rate is the same for foreign and local companies - a low 17.5 percent. The actual tax bill is often even less after various deductions and depreciation allowances.
There is no capital gains tax in Hong Kong, withholding tax on dividends and interest or collection of social security benefits.
The salaries tax rate is at a maximum rate of 16 percent, imposed only on all salary income of individuals derived in or from Hong Kong. The salaries tax is demanded on a yearly basis and can be paid in two installments, usually between December and March.
The property tax applies to owners of land or buildings situated in Hong Kong. It is low by international standards: 16 percent (for 2004-5) of the rental income from the land or buildings and an allowance of 20 percent is permitted for repairs and maintenance.
There is no sales tax or VAT in Hong Kong. The limited tax base, combined with exceptionally low tax rates, makes Hong Kong's tax incidence much lower than in virtually all other developed economies.
World Class Infrastructure
Hong Kong people take it for granted that everything works properly.
You flick the switch and there's power. The electricity grid is state-of-the-art and supply is more than adequate. Blackouts are not part of the vocabulary. Drinking water is readily and reliably available. Taxis operate around the clock. Mobile phones connect -- even in tunnels and in the underground railway.
The telecommunications system is fully digitised. The government began de-regulating the industry as early as 1995 when it issued fixed line telecommunications network service licences to four providers.
The mobile phone services market is very competitive with six operators and 11 networks. There are currently more than 200 Internet Service Providers in Hong Kong, more than five of which provide broadband connections. Broadband Internet connection is available to over 98% of households and more than 95% of business buildings.
The only modern, fully developed deep water harbour between Singapore and Shanghai, Hong Kong is the focal point of all maritime activities in southern China.
The container port in and around Kwai Chung is privately owned. In 2005, Hong Kong handled a total of 22.42 million TEUs, making it the world's busiest port.
Vessel turnarounds are among the fastest in the world and port charges are among the lowest world-wide. Container ships at terminal berths are routinely turned round in 10 hours or less, while conventional vessels working cargo at buoys are in port for only 1.8 days on average.
The state-of-the-art Hong Kong International Airport is just 23 minutes from the central business district by a high-speed rail link.
Opened on 6 July 1998, the Hong Kong International Airport is already one of, if not the best airports and one of the world's busiest airports and can process about 36 million passengers and 3 million tonnes of air cargo annually.
Rule of Law
The rule of law is fundamental to Hong Kong's success. All are equal before the law. Hong Kong's legal system is separate from Mainland China's, and English common law prevails. The impartial judiciary is independent of the legislature and executive, and is drawn from several British Commonwealth jurisdictions as well as from Hong Kong itself. Cases are heard in English and/or Chinese.
These freedoms are guaranteed by the Basic Law, which came into effect when China resumed sovereignty of Hong Kong in mid-1997 and serves as the SAR's constitutional framework. Its underlying premises are best summed up as "One Country, Two Systems" and "No change for 50 years". Post-1997 Hong Kong inherited the laws of the former colony so that Hong Kong today continues to benefit from a stable and mature legal system, covering such business critical areas as intellectual property.
Court of Final Appeal
The Court of Final Appeal operates in Hong Kong and is staffed by senior judges from Hong Kong and distinguished overseas judges on rotation. It is the final arbiter on all affairs other than foreign affairs, defence and Chinese constitutional issues, which are the responsibilities of the sovereign state, China.
Hong Kong has developed into one of the world's major arbitration jurisdictions since establishing its International Arbitration Centre in 1985. Its expertise in commerce, finance, shipping and construction provides the necessary pool of experienced professionals to promote dispute settlements. These include accountants, architects, bankers, engineers and insurance experts, as well as lawyers.
Hong Kong has long been, and remains, a safe city with low crime rate. Crucial to this achievement is our effective and efficient 35,000-strong police force. It operates independently of Mainland China's law-enforcement institutions. Crime levels in Hong Kong are low. And its streets are among the safest in the world.
World's Freest Economy
Free trade is the life-blood of Hong Kong. As a result, it is one of the most open, externally-orientated economies in the world.
The Heritage Foundation/Wall Street Journal from US and Cato and Fraser Institutes of Canada have consistently rated it as the world's freest economy.
Hong Kong embraces globalisation of trade and services and is an active participant in international organisations that promote such activities.
- The cornerstone of the economy rests on free enterprise, free trade and free markets open to all
- No barriers to trade - no tariffs, no quotas, no exceptions
- No restrictions on investments inward or outward
- No foreign exchange controls
- No nationality restrictions on corporate or sectorial ownership
Free Flow of Information
Hong Kong enjoys a constitutionally-guaranteed free press and freedom of speech. More than 40 newspapers and 700 periodicals are published in Chinese and English in a city that is home to about 130 media organisations. There is no government censorship and both local and overseas publications circulate without hindrance.
All the top international news organisations maintain a presence in the territory and many trans-continental publications print their Asian editions here. As a result, journals such as the International Herald Tribune, the Financial Times, USA Today and Nihon Keizai Shimbun are available first thing in the morning.
Hong Kong is served by two local English language newspapers, the South China Morning Post and the Standard.
Regional publications edited here include the Asian Wall Street Journal, the Far Eastern Economic Review and Time Magazine's Asian Edition.
Chinese-language publications range in tone from the weighty Economic Journal to the irrepressible tabloids, Apple Daily and Oriental Daily News. In between lies a huge range of political, lifestyle and leisure-orientated journals.
Newspapers and magazines from all over the world are available at newsstands.
Hong Kong's two terrestrial television stations broadcast in English and Cantonese. Cable and satellite systems provide access to a wide range of channels, including CNN International, BBC World, HBO, CNBC, and the Discovery Channel. Hong Kong was the first in the world to roll out video on demand.
The government-funded broadcaster, Radio Television Hong Kong, is run along the lines of the British Broadcasting Corporation (BBC) and enjoys editorial independence. It broadcasts in English, Cantonese and Putonghua. It also relays the BBC World Service. Independent radio stations broadcast in both English and Chinese.
All the world's major news agencies, including Reuters, Associated Press, Agence France-Presse, Dow Jones Newswires and Bloomberg, have a presence in Hong Kong, where they freely collect and distribute news, data and financial information. Their services are augmented by smaller specialist agencies, including mainland Chinese and Taiwanese organisations.
Hong Kong is one of the most Internet-savvy cities in the world. It is rapidly adopting the latest wireless technology as it rolls out. The government does not seek to censor Internet access through mandatory filtering software or other measures.
Broadband is available to over 98% of households and more than 95% of business buildings.
Hong Kong ranks among the very best in the world in terms of management experience in international business. The extraordinary success of our economy owes much to its well-educated and adaptable workforce.
Hong Kong's workforce is computer-literate, resilient, flexible and entrepreneurial. The culture here is one of industriousness underlined by a hunger among individuals to better themselves.
Labour relations are generally harmonious.
English is the lingua franca of the business and legal community.
Immigration procedures for skilled personnel are transparent and straightforward.
The Government is actively seeking to promote a competitive and knowledge-based workforce by a number of measures:
- Hong Kong provides nine years of free compulsory education.
- Hong Kong funds 10 universities and colleges and is engaged in boosting life-long learning through community colleges, tertiary institutions and the Internet.
- Tertiary education accounts for about one-third of the education budget.
Copyright® All Rights Reserved