Page 142 - 2020 Special Report on the State of Business in South China
P. 142
Hong Kong
The Economy hub for offshore RMB. According to SWIFT, Hong
Kong is the largest RMB clearing center in 2019,
Situated at the southeastern sharing about 76% of the world’s RMB clearing
tip of China, Hong activities2 .
Kong is at the center of East Asia. Since its
return to the Chinese Mainland in 1997, the Meanwhile, Hong Kong's stock market was
special administrative region has followed the ranked the 3rd largest in Asia and the 6th largest
“One Country, Two Systems” policy under the in the world in terms of market capitalization as of
Basic Law, its mini-constitution. Hong Kong is August 20193 . There were 2,427 companies listed
considered one of the world’s freest economy, on HKEx4 and the total market capitalization of
and under its laissez faire system its financial Hong Kong's stock market reached US$3.82 trillion.
sector has developed to be one of the centers In more recent years, the size of Hong Kong’s asset
in the region. In addition, Hong Kong continues management market has been rising, particularly
to play a significant role as a portal for the with the help of a growing number of high-net
Mainland’s merchandize and capital flow. worth individuals settling in Hong Kong. In 2018,
the total asset under management (AUM) of funds
According to the UNCTAD World Investment registered for sales in Hong Kong moderated by
Report 2019, global FDI inflows to Hong Kong 6.0%YoY to USD2.1t5 , with comparable growth
amounted to US$116b in 2018, ranked 3rd globally, among key categories such as equity, bond, and
and behind only the Chinese mainland (US$139b) mixed-asset funds.
in Asia. In terms of outflows, Hong Kong ranked
3rd in Asia with US$85b, after Japan (US$143b) and Hong Kong follows a free trade policy and hence
the Chinese mainland (US$130b). Most of these maintains basically no barriers to trade: there
investment flow, remarkably, is due to its position are no customs tariffs on goods imported into
as a portal to investment flows into and out of the or exported from Hong Kong. Import and export
Mainland. Thanks partly to this proxy position, licensing are kept to a minimum. Most products
Hong Kong was the world’s 2nd largest host in FDI do not need licenses to enter or leave Hong Kong
stock in 2018, after the United States. and where licenses or notifications are required,
they are only intended to fulfill obligations under
Hong Kong also benefit from being a financial various international agreements, or to maintain
center. According to the Bank for International public health, safety or security. Therefore, while
Settlements, Hong Kong is the largest foreign much of Hong Kong’s indigenous manufacturing
exchange market in Asia and the 3rd largest in capacity has moved to the mainland since the
the world in April 2019, with the net daily average 1980s, it remains a trade hub with a significant
turnover of forex transactions reaching US$691b1 share of merchandizing, transshipment, and trade
.This is in part due to Hong Kong’s position as a facilitation in the region.
1 https://www.bis.org/statistics/rpfx19_fx_annex.pdf 2 https://www.swift.com/file/64651/download?token=h9xZuKG4
3 https://focus.world-exchanges.org/issue/september-2019/
market-statistics
4 https://www.hkex.com.hk/eng/services/trading/securities/secu-
ritieslists/ListOfSecurities.xlsx
5 https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-
announcements/news/doc?refNo=19PR73
142
The Economy hub for offshore RMB. According to SWIFT, Hong
Kong is the largest RMB clearing center in 2019,
Situated at the southeastern sharing about 76% of the world’s RMB clearing
tip of China, Hong activities2 .
Kong is at the center of East Asia. Since its
return to the Chinese Mainland in 1997, the Meanwhile, Hong Kong's stock market was
special administrative region has followed the ranked the 3rd largest in Asia and the 6th largest
“One Country, Two Systems” policy under the in the world in terms of market capitalization as of
Basic Law, its mini-constitution. Hong Kong is August 20193 . There were 2,427 companies listed
considered one of the world’s freest economy, on HKEx4 and the total market capitalization of
and under its laissez faire system its financial Hong Kong's stock market reached US$3.82 trillion.
sector has developed to be one of the centers In more recent years, the size of Hong Kong’s asset
in the region. In addition, Hong Kong continues management market has been rising, particularly
to play a significant role as a portal for the with the help of a growing number of high-net
Mainland’s merchandize and capital flow. worth individuals settling in Hong Kong. In 2018,
the total asset under management (AUM) of funds
According to the UNCTAD World Investment registered for sales in Hong Kong moderated by
Report 2019, global FDI inflows to Hong Kong 6.0%YoY to USD2.1t5 , with comparable growth
amounted to US$116b in 2018, ranked 3rd globally, among key categories such as equity, bond, and
and behind only the Chinese mainland (US$139b) mixed-asset funds.
in Asia. In terms of outflows, Hong Kong ranked
3rd in Asia with US$85b, after Japan (US$143b) and Hong Kong follows a free trade policy and hence
the Chinese mainland (US$130b). Most of these maintains basically no barriers to trade: there
investment flow, remarkably, is due to its position are no customs tariffs on goods imported into
as a portal to investment flows into and out of the or exported from Hong Kong. Import and export
Mainland. Thanks partly to this proxy position, licensing are kept to a minimum. Most products
Hong Kong was the world’s 2nd largest host in FDI do not need licenses to enter or leave Hong Kong
stock in 2018, after the United States. and where licenses or notifications are required,
they are only intended to fulfill obligations under
Hong Kong also benefit from being a financial various international agreements, or to maintain
center. According to the Bank for International public health, safety or security. Therefore, while
Settlements, Hong Kong is the largest foreign much of Hong Kong’s indigenous manufacturing
exchange market in Asia and the 3rd largest in capacity has moved to the mainland since the
the world in April 2019, with the net daily average 1980s, it remains a trade hub with a significant
turnover of forex transactions reaching US$691b1 share of merchandizing, transshipment, and trade
.This is in part due to Hong Kong’s position as a facilitation in the region.
1 https://www.bis.org/statistics/rpfx19_fx_annex.pdf 2 https://www.swift.com/file/64651/download?token=h9xZuKG4
3 https://focus.world-exchanges.org/issue/september-2019/
market-statistics
4 https://www.hkex.com.hk/eng/services/trading/securities/secu-
ritieslists/ListOfSecurities.xlsx
5 https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-
announcements/news/doc?refNo=19PR73
142
