hong kong for business

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Very good synopsis of why Hong Kong is still a very important centre of business

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PowerPoint

Where Business Goes to Grow

Andrew Davis Associate Director-General 2 May 2014

Using Asia's Premier City to Access Opportunities Across the Region

Australian Trade and investment in HK The Australian business community has always

played a leading role in HK, with an estimated 90,000 Australians and over 600 Australian companies

There were 32 regional HQ, 43 regional offices and 78 local offices set up by Australian companies as at Jun 2013

Australia is 2nd largest source of wine import (16.2% of total wine import volume)

The memorandum of Understanding on Co-operation in wine-related business between Hong Kong and Australia was signed in April 2009

Other major import items from Australia: Telecommunications; non-ferrous metals; meat

Healthy growth in bilateral trade in services between HK and Australia at 5% on average from 2008-2012 Wine of fresh grapes

Source: Census and Statistics Department

Hong Kong: Host of Many Australian Companies

Business & Professional Services

Creative Industries

Consumer Products

Financial Services

Innovation & Technology

Tourism & Hospitality

Transport & Industrial ICT

Australia and New Zealand Banking Group (ANZ)

ASF Group Clayton Utz Chandler

Macleod Group Commonwealth

Bank of Australia

Laservision LHD Group National

Australia Bank Qantas Airways Talent2 HK Ltd Telstra The Ambition

Group UGL Rail

Services Pty Westpac

Banking Corp.

On-off Ltd

More Successful Cases

A variety of sectors are keen to capture the opportunities in Hong Kong, including for example Business and

professional services

Consumer products

Financial services

Mining companies

Mallesons Stephen Jaques (Law firm) Merged with Mainland law

firm titan King & Wood in March 2012 and now forms one of the largest legal networks in the Asia-Pacific region

In terms of where our business genuinely intersects, Hong Kong is the centre of that connection, Stuart Fuller Global Managing Partner

Aesop (Skincare brand) First opened an office in

Sheung Wan in late 2010 It then started to create a

separate regional group to provide support to business development, marketing, retail training and planning and development

There are many reasons to place a regional support team in Hong Kong: efficient transport connections, excellent local advisers and a strong market for international-standard retailing and premium consumer goods,

Nicholas Mulcahy General Manager, Asia Pacific

Heart of Asia

Connectivity to the World

4hours Most of Asias key markets within four hours flight time

5hours From half the worlds population

Connectivity to the World HKIA is the world's busiest cargo gateway and one of the

world's busiest passenger airports. In 2013, 59.9 million passengers used HKIA and 4.12

million tonnes of air cargo passed through Hong Kong. HKIA is connected to about 180 destinations, including 44 in the Mainland, through over 1,000 daily flights by more than 100 airlines.

Rule of law and independent judiciary Level playing field and no foreign ownership restrictions Political stability and pro-business governance The Worlds Freest Economy for 20 consecutive years Hong Kong negotiates and signs its own economic and trade agreements

and is a full and separate member of the WTO and APEC Free flow of information

One Country Two Systems

VAT/GST/Sales tax Capital Gains Tax Withholding tax on investments Estate duty Global taxation Wine and beer duty

Low and Simple Tax System 9

NO * There is no standard rate across the Mainland China. Shanghai is used as an example

Percentage

World Class ICT Connecting 8th in the Global Innovation Index Report (INSEAD 2012)

2nd in Asia Cloud Readiness Index (Asia Cloud Computing Association, Sept 2011)

Fastest broadband globally 65.4 Mbps

The safest place in Asia for setting up data centres (Data Centre Risk Index, Cushman $ Wakefield, 2013)

Highest mobile internet usage rate in Asia Pacifc (96% users online daily) (Google) Mobile phone penetration rate >238.2% (Dec 2013, OFCA)

Human Capital - Quality Education

x 2

x 49

Two universities in the worlds top 100

(Times Higher Education World University Rankings 2013/14)

HKUST MBA 1st in Asia and 8th in the world

(Financial Times Global MBA Ranking 2013)

Worlds Top EMBA in 2013: Kellogg HKUST EMBA

Programme (Financial Times 2013)

49 International schools 3rd in the Global Index of Cognitive Skills

and Educational Attainment (Economic Intelligence Unit 2012)

Hong Kong students ranked first in reading literacy

globally (Progress on International Reading

Literacy Study 2011)

Latest: Chicago Booth First EMBA Starts in Hong Kong (June 2014)

Unique advantage: Global Financial Centre

Ranking City 1 New York 2 London 3 Hong Kong 4 Singapore 5 Zurich 6 Tokyo 7 Seoul 8 Boston 9 Geneva 10 San Francisco

The Global Financial Centres Index (GFCI) 9, March 2014

Most Competitive Financial Centre in Asia Pillar of the Hong Kong economy

16.1% of GDP

Asias 2nd largest stock market Worlds 2nd largest IPO centre

(expected ranking by E&Y)

1st and largest off-shore RMB platform Base for 70 of the worlds 100 largest

banks

Asias asset management hub Worlds largest securitized derivatives

market in 2012

Greater Pearl River Delta

Population 64 mn > UK, Italy, South

Africa

Exports US$527 bn > UK, Italy

GDP US$962 bn > Indonesia,

Netherlands, Turkey

Land Area 56,000 km2 < Ireland, Latvia, Panama, West Virginia (US)

Closer Economic Partnership Agreement (CEPA) Opens the door to mainland China

For trade in Goods: Set up production lines in HK

to produce goods that meet the CEPA Rules of origin to enjoy zero tariff on importation into mainland , and rigorous protection of intellectual property in HK

For trade in Services: Incorporate and set-up in HK, and make use of preferential arrangements to start business in mainland :

Allow wholly-owned operations Lower entry criteria Relax equity control and more Professionals enter mainland market via increasing no.

of MRQ, facilitating registration, etc By end-July 2013, CEPA had provided HK companies with

tariff savings of over US$595 million 1,700 products and 47 service sectors are benefited

Riding on CEPA zero tariff preference, the

company set up a company plus small

factory in Hong Kong in 2012 for pearls

processing

Tai Lai Enterprise

Business-to-Business 2000 2013

% of mainland

companies

% of mainland capitalisation

49%

57%

18%

27%

To the regional markets

797 listed Mainland enterprises on the HKEx; total market cap US$1.76 tn (as of Dec 2013) (Source: HKEX)

2,264 new investment projects approved; investment amount US$43.7 bn (as of 2013) (Source: MOFCOM)

RMB deposits in Hong Kong of RMB1,053 bn (~US$173 bn) (as of Dec 2013) (Source: HKMA)

To mainland market

StartJG started cooperating with Chow Tai Fook (one of the worlds largest jeweler) and Suning (one Chinas largest electronics retailers) after setting up in HK

Photo credit: StartJG; Suning: Chow Tai Fook

Business-to-Consumer

Source: James Davies, Rodrigo Lluberas and Anthony Shorrocks, Credit Suisse Global Wealth Databook 2011

Coachs Regional HQ in HK drives expansion in Asia.

z Gateway to 3.7 million HNWIs in Asia-Pacific with wealth totalling US$12 tn

z Wealth growth the strongest in Asia-Pacific at 12%

z Hong Kong HNWIs up 36%

z Asia-Pacific expected to lead robust global HNWI wealth growth. HNWI wealth expected to reach US$16 tn by 2015 Source: Capgemini World Wealth Report 2013

Asia-Pacific accounted for 50% of the growth in global wealth since 2010

By 2020, est. no. of millionaires in Mainland China & Hong Kong will reach 3.7 million, an accumulated wealth of US$14 trillion

HK is a strategic location for retail brand in Asia.

Being successful in HK has helped to build up brand awareness and

credibility in the region.

54.3 Million Visitors in 2013 +11.7%

Million

Number of visitor arrivals

Mainland China Rest of the World

Source: Hong Kong Tourism Board

Total Retail Sales US$64 Billion +11%

84% of the worlds leading luxury and fashion retailers are in Hong Kong

of all international retail brands are in Hong Kong

41%

18 in Hong Kong 12 in London

No. of Shops

13 in Hong Kong 5 in Milan

10 in Hong Kong 4 in Milan

Cosmopolitan Life

Unique City with Mountains, Harbors, Skyscrapers and Best Food All in One The city has 5 of the Worlds 100 Best

Restaurants 5 Michelin starred restaurant ,with

the worlds cheapest starred restaurant Tim Ho Wan

Ozone B