Posts Tagged ‘Hong Kong’
Hong Kong comes first in economic freedom rankings again
Wednesday, January 19th, 2011The 2011 Index of Economic Freedom, a project of The Wall Street Journal and the conservative Heritage Foundation, ranked Hong Kong as the world’s freest economy, giving the “Asian tiger” that title for 17 years in a row. The report generally covered the last half of 2009 and the first half of 2010.
Overall, this year’s report saw economic freedom on the rise around the world, with scores on freedom rising in almost two-thirds of the countries examined.
The study’s executive highlights found “those gains are particularly welcome and significant given the fact that the biggest improvements have been achieved in developing and emerging economies where poverty reduction is a top priority.”
Four economies saw their scores rise at least three points: Rwanda, Djibouti, Seychelles and the Solomon Islands.
According to Heritage, six areas — Hong Kong, Singapore, Australia, New Zealand, Switzerland and Canada — have set themselves apart as the world’s “free” economies. Ireland and Denmark also ranked above the United States in this year’s index.
Venezuela, Cuba and North Korea were among the countries in the rear of this year’s rankings.
The Top 10
1 Hong Kong (89.7 points)
2 Singapore (87.2)
3 Australia (82.5)
4 New Zealand (82.3)
5 Switzerland (81.9)
6 Canada (80.8)
7 Ireland (78.7)
8 Denmark (78.6)
9 United States (77.8)
10 Bahrain (77.7)
Hong Kong ranks 4th-largest global FDI recipient
Wednesday, August 4th, 2010Hong Kong was the world’s fourth-largest Foreign Direct Investment (FDI) recipient in 2009, according to the World Investment Report 2010 (WIR) released by the United Nations Conference on Trade and Development (UNCTAD) on July 23. This marks the first time that Hong Kong has attained fourth place in the global rankings and represents a jump from its ninth position in 2008.
For the 12th consecutive year, Hong Kong continues to be the second-largest FDI recipient in Asia, after mainland China.
Although the global financial and economic crisis drove global FDI inflows down by 37% in 2009 compared with 2008, the impact on Asia was less profound. The US$48.4 billion FDI inflows to Hong Kong, for example, represented a 19% decrease. Hong Kong’s share of FDI inflows into Asia held up at about 21% in 2009, similar to 2008.
Looking ahead, the WIR 2010 provided a glimpse of the global economic recovery picture, highlighting Asia’s rapid recovery in FDI flows compared with the more gradual improvement in global numbers. For example, in the first quarter of 2010, FDI inflows to Hong Kong, amounted to US$20 billion, representing a significant increase of 72% compared with the same quarter last year.
Using a Hong Kong company to operate a business in China
Saturday, April 4th, 2009Hong Kong has historically been a gateway to China. Despite the rise of major financial and trading centers in the mainland (Shanghai, Shenzhen, Beijing, Guangzhou etc.), the city has remained attractive for foreign companies expanding into the region because of its free market system, clean government, low taxes, world-class infrastructure, skilled workforce and international lifestyle, among other advantages.
For China residents, especially foreign nationals, incorporating in Hong Kong has always been a very strong alternative to setting up a business in a mainland Chinese city, where start-up. Consulting and trading are two areas where using Hong Kong has become a trend.
Consultants in China can use their Hong Kong company to bill their customers, both in China and overseas. For their China customers, providing services as company would definitely be better perceived than doing it as an individual. For international clients, one can provide China-related consulting services by using a Hong Kong company, which technically is part of China, without the price tag that comes with incorporating in mainland China.
Sole traders living in China can use a Hong Kong company to receive payments from international clients and pay their Chinese suppliers. Considering that China doesn’t tax offshore profits, and mainland China is considered offshore, this is a very attractive solution to conduct international trade without the need to rent and operate an actual office.
There are disadvantages for using Hong Kong companies to operate in China however. The first one would be the inability to receive RMB payments and bill your Chinese customers in RMB. Indeed, Chinese firms and individuals will require in most cases to pay in Chinese Yuans (or RMB, the official currency), and will need an official tax receipt (“fapiao”) to justify their expenses in their accounting records. A Hong Kong company is legally a foreign company in mainland China and as so is not able to issue such invoices. Furthermore, Chinese Yuans/RMB cannot be sent from mainland China to your Hong Kong company bank account, meaning the need for your customers to change their money into USD/HKD first which can be a burden.
Another disadvantage would be the visa and other tax/legal issues if you live in China. As we said earlier, a Hong Kong company is considered a foreign company in China and as does not entitle the owner for a residence permit in mainland China. In face of the increasing tightening of the visa regulations in mainland China, this may mean frequent trips to Hong Kong or even to your home country. This can be solved however when you set up a representative office for your Hong Kong company in a Chinese city.
We register Hong Kong companies for USD1,200 only. Feel free to contact us for more information or to receive the application form. Only a passport copy is required and the whole procedure can be completed within 15 days.
