I was in Hong Kong last week to speak at a conference and decided to compile a top ten list. Enjoy this Top 10 Business Facts about Hong Kong:
1) Hong Kong is known as one of the 4 Asian Tigers – alongside Singapore, South Korea and Taiwan. These regions were the first newly industrialised countries with highly developed economies.
2) As of January 2019, Hong Kong is ranked #1 in the world for having the most number of skyscrapers that are taller than 150m (total of 353). New York comes in at a distant second with 273.
3) The territory has become one of the world’s most significant financial centres. In 2018, the Hong Kong Stock Exchange was ranked #5 globally in terms of market capitalisation, behind the New York Stock Exchange, NASDAQ, Tokyo Stock Exchange and Shanghai Stock Exchange respectively. Interestingly in 2009, Hong Kong raised 22 percent of global IPO capital, becoming the largest centre of IPOs in the world.
4) In the 24th edition of the Global Financial Centres Index (GFCI) released in September 2018, Hong Kong took the #4 spot behind New York, London and Singapore. The GFCI surveys bankers around the world regarding the top 100 global financial centres and is produced by London-based think tank Z/Yen and the China Development Institute (CDI).
5) Hong Kong has little arable land and few natural resources, importing most of its food and raw materials. Imports account for more than 90 percent of Hong Kong’s food supply, including nearly all its meat and rice. Agricultural activity is just 0.1% of its gross domestic product (GDP).
6) Hong Kong has been ranked as the world’s freest economy for 24 consecutive years in the Index of Economic Freedom, since its inception in 1995. The index measures restrictions on business, trade, investment, finance, property rights and labour, and considers the impact of corruption, government size and monetary controls in 183 economies. Hong Kong is the only economy to have scored 90 points or above on the 100-point scale, achieved in 2014 and 2018.
7) As the 4th largest Forex trading hub in the world, Hong Kong has one of the world’s highest FX transactions with the average daily turnover crossing USD430 billion. The US dollar is the dominant currency, accounting for over 96% of all transactions.
8) The Hong Kong dollar was pegged at a fixed rate of 7.8 to the US dollar in October 1983. Since May 2005, it has been allowed to move between 7.75 and 7.85. The peg is managed by a currency board wherein Hong Kong’s monetary base is fully backed by equivalent dollar reserves, namely the Exchange Fund. The Hong Kong Monetary Authority (HKMA) is obligated to intervene to defend both ends of the peg.
9) Hong Kong has one of the most tax-friendly economies in the world. It only imposes three direct taxes:
▪️Profits tax is capped at 16.5 percent
▪️Salaries tax is a maximum of 15 percent
▪️Property tax is 15 percent
Hong Kong does not impose tax on sales, VAT, capital gains, dividends or estate.
10) Hong Kong is ranked 7th in the world for global foreign currency reserves with an amount of USD425 billion (as of Sept 2018). China tops the list with USD3.2 trillion in reserves.
Look out for my next top 10 list!
Sincerely,
Mario Singh
