InvestHK

About InvestHK

• Established in July 2000, 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.

• Our vision is to confirm and strengthen Hong Kong as the leading international business location in Asia.

• We are responsible for attracting and facilitating inward investment into the city. We support overseas, Mainland and Taiwanese companies to set up and expand in Hong Kong. We partner with clients on a long term basis and are available to help at any stage of your business development process.

• All our services are free, customized and confidential.

TOP 10 REASONS TO INVEST IN HONG KONG

1. Strategically Located at the Heart of Asia

Hong Kong is positioned at the gateway to China and the Pearl River Delta – “the factory of the world”. All Asia’s key markets are within 3½-4 hours flight time and half the world’s population is within 5 hours flight time.

2. Gateway to Mainland China• The Closer Economic Partnership

Arrangement (CEPA), a free trade agreement between the Central People’s Government and the Government of the Hong Kong Special Administrative Region, allows any Hong Kong company, regardless of nationality, preferential access to the Mainland China market.

• All goods qualified as Hong Kong origin may be exported to the Mainland tariff free.

• Hong Kong service suppliers in 42 areas are eligible to receive preferential treatment in providing services in the Mainland.

3. Low and Simple Tax System• It has the lowest tax misery in Asia Pacific

(3rd lowest in the world), 37 points less than Singapore’s and 117.5 points less than Mainland China’s, according to the Forbes’ Tax Misery Index 2009.

• Profit tax is a maximum 16.5% and salary tax is a maximum 15%.

• The city has no goods and services levy and does not tax offshore income, dividends, interest, capital gains or inheritance income.

• And the duty on both wine and beer is zero.

4. Stable and Efficient Pro Business Environment

• Hong Kong has a clean pro-business government, an independent legal system and practices free market principles.

• Hong Kong has the second best opacity in the world after Finland*

• The Opacity Index measures high-frequency, low-impact risks: corruption, legal system, efficiency, economic and enforcement policies which indicate poorly functioning governments and increased cost of doing business and business risk.

(*source: 2009 Opacity Index, Milken Institute)

5. World’s Freest Economy

• Hong Kong enjoys free flow of capital, talent information and goods and services.

• The city has been ranked the “World’s Freest Economy” for over a decade.

(sources: Heritage Foundation/Wall Street Journal and Fraser Institute)

6. One of the world’s most competitive locations

• Hong Kong is ranked first in business efficiency, second in government efficiency and third in economic performance.

• Hong Kong is ranked the second most competitive location in the world.*

(*source: IMD World Competitiveness Scoreboard 2009)

7. World-class infrastructure: Transport and Telecommunications• Hong Kong International Airport (HKIA)

is one of the world’s top international airports and the world’s fifth busiest international passenger airport

• Hong Kong has been ranked as one of the most e-ready economies in the world.

• Hong Kong’s telecommunications sector is fully privatized and has one of the highest mobile penetration rates in the world.

(*source: Economist Intelligence Unit)

8. A leading International Financial Centre

• Hong Kong is China’s international financial capital and one of the most competitive financial centers in Asia.*

• Hong Kong ranks first in Asia and second in the world in terms of access to capital.

(*source: The Global Financial Centers Index, March 2009, City of London Corporation)

9. Efficient, productive, skilled and multi-lingual workforce

• Hong Kong people have an essential mix of international market savvy, combined with an appreciation of the business culture in the fast-growing Mainland China cities and across Asia.

• English is the usual language of business and contracts are written and executed in English.

10. Asia’s most popular city for International Business

• Hong Kong has a cosmopolitan lifestyle and vibrant expatriate community.

• The city has a wide array of shops, bars and restaurants catering for all international cuisines.

• Over 40% of Hong Kong is made up of protected country parks, comprising mountain tracks and un-spoilt views over turquoise seas and isolated islands.

SECTOR OPPORTUNITIES

Business and Professional Services• Hong Kong's business and professional services sector includes:

accountancy, law, management consultancy, engineering, architecture, education, design, quality inspection and testing, and NGO, etc.

• Hong Kong has developed to be a net exporter of services.• For the first three quarters of 2008, the value of services exported

amounted to US$67.5 billion or 42% of GDP.• Sector growth is fuelled by the strong presence of the world's leading

financial institutions and multinational corporations.

Consumer Products

Asia's Retail Paradise

• Hong Kong is Asia’s retail paradise and Mainland China’s shop window to what’s in and what’s hot.

• Hong Kong has long been acknowledged as a shopper’s paradise.• The annual retail sales receipts- HK$274.7 billion*

Procurement and Trading Centre for Asia

• Free flow of goods, people, information and capital as well as the location on the doorstep of the factory of the world makes Hong Kong the priority destination for consumer goods procurement companies.

• Low tax, mature and stable financial infrastructure, developed logistics networks and international accessibility further complement the activities undertaken by trading and procurement businesses in the city.

(*source: Census and Statistics Department HKSARG)

Creative Industries

• Hong Kong is the leading advertising centre in Asia.• It has the second highest per capita advertising spend in the world.• The city is also one of the world’s largest TV and film exporters.• The broad spectrum of Hong Kong’s creative industries ranges across: advertising,

animation, architecture, art and culture, broadcasting, design, film and music, games, media and multi-media.

• There are an estimated 32,000-plus companies employing about 170,000 people in the diverse range of businesses which make up the creative industries sector in Hong Kong.

• This industry creates an added value to Hong Kong’s Gross Domestic Product (GDP) of more than HK$60 billion annually, representing about four percent of GDP.

Financial Services

• Hong Kong is Asia's regional financial centre and China's international financial capital.

• Hong Kong's financial markets are characterized by a high degree of liquidity and operate under effective and transparent regulations, which meet international standards.

• The financial services sector is a major pillar of Hong Kong's economy. The average annual growth for the sector from 2001 to 2006 was 10.0%.

• In 2006, the financial services sector employed 186,000 staff, accounting for 5.5% of Hong Kong's total employment and contributed close to 16% of Hong Kong's GDP.

Financial Services

• Hong Kong has been recognized as the top asset management centre in Asia with more than 300 fund management firms based in the city.

• The total fund management business in Hong Kong amounted to US$1.23 trillion as at end 2007.

• Hong Kong has Asia's third largest stock market in terms of market capitalization - over US$1,328 billion as at the end of December 2008.

• It is the largest international capital raising centre for mainland enterprises, with over US$275 billion raised through Hong Kong since 1993.

• It is also the world's largest derivative warrant market.

Information and Communications Technology

• Hong Kong has a sophisticated ICT infrastructure with broadband networks covering virtually all commercial buildings and households.

Local and Regional Growth Opportunities• ICT spending in Asia Pacific (excluding Japan) will reach US$184 million in 2010,

registering a 7.7 percent growth with China being one of the growth engines.*• Hong Kong provides a ready market for ICT companies, with 3,600 regional

headquarters or offices based in the city and thousands of Hong Kong businesses located throughout the Greater Pearl River Delta (GPRD) region.

• Hong Kong is also strategically located in the centre of Asia, so regional ICT projects can be effectively implemented and managed from a hub in Hong Kong, and staffed with mobile, tech savvy and multi-lingual professionals in sales, marketing or technical roles.

(*Source: IDC Asia/Pacific (excluding Japan) 2010 Top 10 Predictions, Doc# AP38114, Dec 2009)

Information and Communications Technology

Government Support for the Industry• The telecommunications sector in Hong Kong is fully

liberalized.• The regulatory framework in Hong Kong ensures that

the telecommunications market remains pro-competition and pro-consumer.

• The Hong Kong Government adopts an active outsourcing policy. In 2009-10, the estimated value of outsourced IT projects was forecast to exceed HK$1.1 billion, representing an increase of more than 10 percent compared with the figure for 2008-09.

• Hong Kong is among the world’s top 10 economies in terms of providing support for ICT industry development as an enabler to society.

Innovation and Technology

• Hong Kong is ranked Asia’s leader in innovation and third worldwide.*

• The preferential treatment under the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) provides Hong Kong registered companies, of any nationality, easier access to market opportunities in Mainland China.

• Technology companies based in Hong Kong can also make good use of the advantages of the Pearl River Delta region in manufacturing and the vast Mainland market to achieve economies of scale for research and development (R&D) and product development.

• HKSAR Government invested HK$5 billion to set up the Innovation and Technology Fund, and provided state-of-the-art infrastructure including Hong Kong Science and Technology Parks, Cyberport, the Applied Science and Technology Research Institute and five R&D Centres.

(*Source: Global Innovation Index Report 2009-2010 by Insead)

Tourism and Hospitality

• Hong Kong is one of the world’s most popular destinations and the most frequently visited city in Asia.

• High income local residents who love to dine and travel, a culture of service excellence, world class transportation infrastructure makes it an ideal location to showcase tourism and hospitality products and concepts.

• Annual visitor numbers have hit a recent record of 29.59 million in 2009. This number is forecast to surpass 57 million in 2020, with Hong Kong becoming the 5th most frequently visited tourist destination in the world.

Transport and Industrial Trading

• Hong Kong is the centre of excellence for trading of consumer and industrial products.

• Tariff-free port with world-class trade financing services makes Hong Kong, the natural location for the export and import of goods and services in and out of Mainland China and the rest of southeast Asia.

• Hong Kong is a key transportation hub in the region; its international airport operates the busiest international cargo facilities in the world.

• Many of the companies in the energy, manufacturing, construction, mining sectors are making use of Hong Kong’s excellent trading platform and financial services to grow their industrial businesses, and are basing their strategic control centers in the city to oversee their regional production networks.

SETTING UP AN OFFICE IN HONG KONG

HOW CAN INVESTHK HELP YOU

InvestHK ServicesExpansionHelp to support the development of a client’s Hong Kong business• Business networking opportunities• Business matching services such as providing useful information sources

for trade associations, consulate generals and trade commissions• Hong Kong Trade Development Council can help to support Hong Kong

businesses expand into international markets• Advice on Hong Kong SAR Government initiatives and grants

InvestHK ServicesPlanningLatest information on the Hong Kong business environment:• Sector-specific advice and business opportunities• Business incorporation procedures• Tax and business regulations• Cost-of-business models• Employment legislation and recruiting interns• Immigration requirements• Trade mark registration and trade regulations• Arranging meetings as part of a visit programme

InvestHK ServicesLaunchHelp in generating free publicity to support the launch or expansion of a

client's Hong Kong business. Examples of support include:• Preparing Client Profile• Developing Case Study• Featured in InvestHK's quarterly newsletter (40,000 worldwide electronic

circulation and distribution to InvestHK local and overseas network)• Joint press release on Hong Kong SAR Government newswire• Member of InvestHK Directorate to attend and speak at opening

ceremony• Support with client's press conference

InvestHK ServicesSet upWe facilitate the smooth set up of a Hong Kong business:• Help with finding the right business service providers to support the

establishment of clients' Hong Kong business: accountants, lawyers, real estate agents, human resource companies etc

• Advice on finding the right business location• Liaison with other Hong Kong SAR Government departments to help apply

for necessary licences• Advice on applying for work visasAdvice on settling in Hong Kong:• Applying for international school places• Housing• Healthcare• Social networking

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