More and more foreign companies are opening outposts in Hong Kong, with retailers in the leading business category.
The number of foreign entities in Hong Kong climbed to a new record of 7904 in 2015, an increase of 4.2 per cent on a year ago, according to a joint survey conducted by Invest Hong Kong (InvestHK) and the Census and Statistics Department (C&SD).
The results of the 2015 Annual Survey of Companies in Hong Kong Representing Parent Companies Located Outside Hong Kong show that the 7904 respondent companies included 1401 operating as regional headquarters (RHQs), 2397 as regional offices (ROs) and 4106 as local offices (LOs). The numbers of RHQs and LOs represent a record high.
In terms of jobs, the 7904 companies combined employed about 422,000 people, an increase of 4.3 per cent compared to 2014 and also a record.
In terms of source country/territory, the US ranked first with 1368 companies in Hong Kong, followed by Japan (1358), Mainland China (1091), the UK (631) and Taiwan (413). Among the top 10 source countries/ territories, Mainland China showed the strongest growth, rising by 14 per cent from a year ago.
By sector, import/export trade, wholesale and retail topped the list (3482 companies, or 44.1 per cent of total), followed by finance and banking (1438 companies, 18.2 per cent), and professional, business and education services (1353 companies, 17.1 per cent). Of these three sectors, finance and banking showed the strongest growth with an increase of 9.8 per cent on a year ago.
Put in the context of a five-year period, the number of respondent companies with parent companies located in the Mainland, and companies engaged in the financing and banking sector saw even bigger growth, both climbing by 36 per cent from 805 and 1059 respectively in 2011.
Director-general of Investment Promotion, Dr Simon Galpin, said the significant increase in the number of Mainland enterprises reaffirms Hong Kong’s unique role as the major springboard for Mainland companies to go global.
“The growth in the last five years in the numbering of financing and banking companies demonstrates Hong Kong’s position as an international financial hub in the world,” he said.
The annual survey aims to collect information on the profile of these companies and their views on the business environment of Hong Kong.
In terms of size, the majority of the respondent companies were of small and medium size, with 5441 companies engaging fewer than 20 persons and 1189 companies engaging 20 to 49 persons.
The top three factors that affected the choice of Hong Kong as an RHQ/RO/LO were: the simple tax system and low tax rate (68 per cent of the companies surveyed considered the factor as favourable for Hong Kong), free flow of information (63 per cent), and free port status (59 per cent).