60% of HK-based Japanese companies eye expansion of RCEP operations

RCEP markets, including Japan, accounted for 71% of HK’ total merchandise trade in 2022. 

More than half of Japan-affiliated companies based in Hong Kong plan to expand their Regional Comprehensive Economic Partnership (RCEP)-related business in the next three years, data from the Hong Kong Trade Development Council (HKTDC) showed.

Japanese companies based in HK particularly also plan to expand their RCEP operations with the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) (40.4%) and the Association of Southeast Asian Nations (ASEAN) (39.4%).

To date, there are about 1,400 Japanese companies with regional headquarters or offices in Hong Kong. 

“The respondents are making use of Hong Kong's well-developed logistics and commercial networks, as well as its world-class business services to manage and expand their global business, particularly in the Asia-Pacific region,” the HKTDC commented.

RCEP, the world's largest free trade bloc, came into effect last year. The bloc consists 15 member countries, including China, Japan, Korea, Australia, New Zealand and the 10 ASEAN economies.

It accounts for 71% of Hong Kong's total merchandise trade. 

"Hong Kong has applied for accession to RCEP and once approved, the city will become the first new member of the bloc, enjoying a wide range of benefits, such as tariff concessions. It will also help Hong Kong further integrate into regional supply chains and strengthen trade and investment with other members in the bloc, especially Japan and Korea, which have yet to sign free trade agreements with the city," HKTDC Director of Research Ms Irina Fan said.