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| No.2 April, 2013 |
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Businesses continue to view Hong Kong favourably |
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 According to a major international business report, businesses continue to view Hong Kong with strong confidence.
The latest Grant Thornton International Business Report revealed that nearly two-thirds of Hong Kong SMEs would not relocate offshore, even if a lower corporate tax rate was offered elsewhere.
The findings were based on interviews with CEOs, managing directors, chairmen and other senior executives in 3,400 companies from all industry sectors across the globe.
William Chan, Tax Partner at Grant Thornton Hong Kong said the figures show Hong Kong remains a global business city with a multicultural environment.
"The (International Business Report) reveals that 64 per cent of businesses in Hong Kong would not consider moving their headquarters, no matter how much lower the corporate tax rate is in another country," said Mr Chan.
He added that Hong Kong plays a "vital role" in "one of the world's biggest and most complicated markets – China" for several different reasons:
- Hong Kong’s geographical proximity to the Chinese mainland
- Its well-developed infrastructure - including communications, IT and transportation
- Sound legal and banking system, and
- Deep talent pool of well-educated people
"As a place with one of the best legal structures and business-friendly tax environments around the globe, Hong Kong is still able to attract and retain businesses, and more importantly, talented people," added Mr Chan.
Many companies in emerging economies also see Hong Kong as a stepping-stone for their entry into the Chinese market.
"Most of the mature economies, such as the Eurozone and the United States, have been expanding in China for some years, and even if they know the market, they are currently struggling through hard economic times," said Mr Chan.
"Countries that still have the money and resources to expand and grow are mainly from emerging markets. To these economies, Hong Kong is seen as an ideal place to start, as they usually have less experience in stepping into new markets."
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