Number of overseas-based firms operating in Hong Kong surged

Japan emerged as main source  of foreign firms in HK.

According to a report, the number of business operations in Hong Kong with parent companies overseas and in Mainland China grew 2.7% year-on-year to 7,449, according to the 2013 Annual Survey of Companies. Those with parent companies located in Asia grew 7.8% to reach 3,461.

Invest Hong Kong and the Census & Statistics Department released the survey results today.

In terms of source country or territory, Japan topped the survey with 1,389 companies in Hong Kong, a gain of 14%. Two others in the top five were the Mainland and Taiwan.

Director-General of Investment Promotion Simon Galpin said the survey findings showed Hong Kong's robustness, particularly for its regional neighbours.

“Japan has become the number one source of foreign companies that are based here and has overtaken the US for the first time since 2001. So it is quite significant and the growth is also significant. We are seeing Japanese companies in a wide variety of sectors, in transportation and logistics. A very strong number are in food-related businesses.”

Mr Galpin said it is an encouraging trend and hopes it will continue.

“One of the things we have to watch when it comes to the sharp increase in Japanese companies is whether the recent devaluation of the Japanese yen will have an impact on Japanese companies’ interest and ability to invest outside of Japan.”

The survey found Hong Kong's simple tax system and low tax rate, free flow of information, geographical location, free port status, rule of law, and independent judiciary as influential factors in companies' choosing to open headquarters here.