Welcome to Hong Kong World Cities World Class University Network

International Profile of Hong Kong Charles Ng Associate Director-General of Investment Promotion 15th March 2011 1

RIGHT PLACE Hong Kong’s Enduring Advantages

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Asia’s Leading City for International Business 529

Regional Headquarters Regional Offices

405 288

271

224 194

184

162 105

rs

43

O th e

Ko re a

tra lia Au s

Ta iw an

Si ng

24 41 19

26 32

Sw ed en

30

ap o

Ita ly

la nd

s

Sw it z er

41

re

98 52 50 47 57 43 62

Ne th er la nd

an ce

62

Fr

an y

72

G er m

na

145

120

99

Ch i

UK

Ja pa n

US

113

3,638 regional headquarters and offices Source: 2010 Annual Survey of Companies in Hong Kong Representing Parent Companies Located outside Hong Kong, Census & Statistics Dept, HKSARG

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One Country, Two Systems

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One Country, Two Systems (cont’d) • World class arbitration & mediation centre • Rule of laws, separate judiciary • Value Transparency, corporate governance • Freedom of expression, free movement of capital, goods & people

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One Country, Two System (cont’d) • Hong Kong ranked 1st in the Globalization Index 2010 – Openness to trade; capital movements; exchange of technology and ideas; movement of labour and cultural integration (by Ernst & Young in cooperation with the Economist Intelligence Unit)

• Hong Kong ranked the freest economy for 17th consecutive year per 2011 Index of Economic Freedom (by Heritage Foundation and The Wall Street Journal)

• Hong Kong ranked 1st for the vote of Asia- Pacific’s best economies for investment – Rule of law; taxation, corruption, openness to international trade and business; public sector quality and effectiveness and fiscal and monetary administration (by Vriens & Partners)

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Heart of Asia and Gateway to China • The world's 4th busiest international passenger airport • One of the world’s busiest container ports

• 23 minutes from central business districts to Airport by express rail link • Less than an hour from GPRD “factory of the world”

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Forbes Tax Misery Index 2009 •Only imposes 3 direct tax •Profits, salaries and property •NO VAT/GST or sales tax •NO Capital gain tax •NO withholding tax on dividends and interest •NO Estate duty •NO Global taxation (offshore income and only HK-sourced income is taxable) •NO Wine Duty Source: Forbes Tax Misery Index 2009, Inland Revenue

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World Class ICT - Connecting People • Asia’s most innovative economy Global Innovative Index

• Mobile phone penetration rate 171% • 8th most e-ready economy in the world EIU

• 3rd highest average broadband connection speed US-based network provider Akamai Technologies

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Quality Education and Workforce • Home to Asia’s leading universities and business schools – HKU 1st HKUST 2nd and CUHK 4th in Asia, all in the world’s Top 50 Times Higher Education QS World University Rankings 2010

– World’s Top EMBA in 2010 (2 consecutive years) Kellogg - HKUST EMBA Programme – EMBAs run by HKUST and CUHK ranked 1st and 2nd in Asia Global EMBA Rankings by the Financial Times 2010

• Over 50 international schools serving students of more than 30 nationalities • Dependents have automatic right to work • Permanent residency after 7 years

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Quality of Life

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Global Health/ Sustainability • HSBC Offshore Offspring Survey 2010 – – – –

Overall ranking: 4th out of 14 Childcare ranking: 3rd out of 14 Healthcare and Wellbeing ranking: 7th out of 14 Integration ranking: 4th out of 14

Source: HSBC Offshore Offspring Survey 2010, commissioned by HSBC Bank International Expat Explorer

• Hong Kong comes 3rd in Asia, after Osaka and Tokyo in Global Liveability Ranking 2010 – Based on stability, health care, culture and environment, education and infrastructure, etc By Economist Intelligent Unit

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HSBC Offshore Offspring Survey 2010Rankings Country

Overall

Childcare

Health & Wellbeing

Integration

Belgium

1

1

6

2

Spain

2

6

1

1

France

3

2

4

6

Hong Kong

4

3

7

4

Germany

5

4

5

11

Canada

6

10

3

6

Australia

7

12

2

12

Netherlands

8

9

8

5

China

9

8

11

3

Singapore

10

7

10

10

UAE

11

10

9

9

Qatar

12

5

13

14

United States

13

13

12

8

United Kingdom

14

14

14

13

Source: HSBC Offshore Offspring Survey 2010, commissioned by HSBC Bank International Expat Explorer

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RIGHT TIME New Opportunities & Unique Role of Hong Kong

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China

Global +

Opportunities

+

Opportunities

= Hong Kong Advantage (Unique Position in the World)

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Hong Kong Gateway to Asia, in particular China

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Hong Kong – Gateway to the World

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Most Competitive Finance Centre in Asia Ranking

City

1

London, New York

3

Hong Kong

4

Singapore

5

Tokyo

6

Chicago

7

Zurich

8

Geneva

9

Shenzhen, Sydney

• World’s 6th largest foreign exchange centre in 2010

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Shanghai

11

Toronto

• International Capital Formation Centre

…

• China’s Global financial Capital • The platform for Offshore RMB Trade Settlement • Asia’s leading asset Management hub • Home to 70 of the world’s 100 largest banks • Asia’s 3rd largest stock market and 7th in the world • Total market capitalization as at end of 2010 - US$2.7 trillion

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(1st globally in IPOs in 2010, US$57 billion raised)

Beijing, San Francisco

The Global Financial Centres Index (GFCI) 7, City of London Corporation, March 2010

Source: HKEx, HKTDC, World Federation of Exchanges, Time Magazine

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Increasing Visitor Arrivals Million

40

Rest of the World

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Mainland China

30

13.53

25 20 15 10 5

7

22.47

8.5

0 2003

2010 (Provisional)

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Source: HKTB

Mainland Companies in Hong Kong % of Mainland companies listed in HK and their market capitalisation 57%

2000 2010 (as of Dec)

•

As at end 2009, 4,792 Mainland companies have MOFCOM approval to establish subsidiaries in HK with a total investment of US$29.3 bn

•

934 new investment projects approved in 2009, with an investment amount of US$8.5 bn (MOFCOM)

•

RMB deposits in HK increased to RMB 314.9 billion as of Dec 2010

42%

27%

15%

No. of companies

Market capitalisation

Source: HKEx

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Opportunities in 6 New Areas: • • • • •

Testing and Certification Medical Services Innovation and Technology Cultural and Creative Industries Environmental Industry (in particular solar energy and R&D) • Educational services Other Opportunity: • Wine

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Role of Hong Kong -for Multinationals, SMEs & Start-ups • Global & regional headquarters (command & control centre) • Global procurement & supply chain management • Global treasury centre • International capital formation centre • Offshore Renminbi platform for trade & investment

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Hong Kong is the Best Platform for: • Project financing • Product design & development with full Intellectual Properties protection • Product adaptation for Mainland and international markets • Development of prototype and samples • Production of niche high end value products • International marketing distribution and trade development worldwide • Training in Asia • Customer service & customer relationship management

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Project in progress

Investment in Infrastructure Total public spending on infrastructure is HK$40 billion (US$5.1 billion) in 2009/10

Project completed

Lok Ma Chau loop joint development – 2009 (studies)

Lok Ma Chau crossing - 2007 HK – Shenzhen Western Corridor Bridge - 2007 Guangzhou – Shenzhen – Hong Kong Express Rail Link - 2014

Tuen Mun – Chek Lap Kok Link - 2016

Sha Tin to Central Rail Link - 2015/19

New Cruise Terminal at Kai Tak - 2014/15

West Kowloon Cultural District – completion of master planning in mid 2011

South Island MTR Line - 2015

Hong Kong – Zhuhai – Macao Bridge overall length of 50km - 2015/16

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HK as a creative hub: West Kowloon Cultural District

City Park Foster+Partners

Cultural Connect: Key to Sustained Vitality Rocco Design Architects Ltd

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Project for a New Dimension Office for Metropolitan Architecture

HK as a creative hub- new development – West Kowloon Cultural District (WKCD) - HK$21.6 billion project, 40 hectares of land, featuring a new modern art museum, 15 theatres, concert halls and other performance venues. 1st phase- to be completed 2015-2020. – Police Married Quarters - HK$530 million conservation project, a new design hub with 130 studios for artists/designers to create, sell and display their works. Complete by 2014. – Central Police Station Revitalisation Project – HK$1.8 billion project by renowned architects, Herzog & de Meuron, PMT, Rocco Design, a new contemporary arts centre providing new gallery, performance and exhibition space. Complete by 2014. 27

HK as a creative hub: Former Police Married Quarters

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HK as a creative hub: Former Central Police Station

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Opportunities in Art “In a very short time Hong Kong will be the most important art trade fair in the world. In fact -this could be the Art Basel of Asia”

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About Invest Hong Kong What we do

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Strong Performance in Foreign Direct Investment 120.0

FDI Inflows

108.3 95.0

100.0

US$ billion

• Hong Kong is the world’s 4th largest FDI recipient 2008

80.0

• Highest FDI stock in Asia (nearly US$912.2 bn)

2009 59.6

60.0

48.4 40.4

40.0

• Top of UNCTAD’s FDI Performance Index

34.6

16.8

20.0

10.9

8.4

5.8

0.0 China

Hong Kong

Singapore

India

Korea, Republic of

FDI Stock – South, East and South-East Asia, 2009

• 3,638 overseas/ Mainland companies set up regional headquarters and offices (as at Dec 2010)

Hong Kong, 36.9%

Others, 18.9% India, 6.6%

Singapore, 13.9% Korea, 4.1%

China, 19.2% Source:2010 UNCTAD World Investment Report

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Priority Areas Covered by Eight New Sector Teams Eight New Sector Teams Creative Industries (CI)

Six New Growth Industries/ Wine

Four Traditional Pillar Industries

‧Culture & Creative Industries

Consumer Products (CP)

‧Trading & Logistics (trading)

Transport and Industrial (T&I)

‧Trading & Logistics (logistics)

Tourism and Hospitality (T&H)

‧Wine Industry

Financial Services (FS)

‧Tourism ‧Financial Services

Innovation and Technology (I&T)

‧Environmental Industries ‧Medical Services ‧Innovation & Technology

Information and Communications Technology (ICT)

‧Innovation & Technology

Business and Professional Services (BPS)

‧Education Services ‧Testing & Certification Services

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‧Professional Services

Representation in 26 Cities Around the World

Investment Promotion Units (in ETOs)

Asia Pacific

Mainland and Taiwan

Europe

Middle East

North and South Americas

Sydney Tokyo

Beijing Chengdu Guangzhou Shanghai

Berlin Brussels London

-

New York San Francisco Toronto

Taipei

Düsseldorf Gothenburg Istanbul Milan Paris Moscow

Tel Aviv

Bogota

Consultants Bangalore Kuala Lumpur Mumbai Osaka Seoul

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How InvestHK Helps Investors Department for FDI - Supporting overseas, Mainland and Taiwanese businesses to set up and expand in Hong Kong

Information to aid planning and evaluation

Facilitation of visa applications, schooling

InvestHK PR and marketing support for launch/ expansion

Networking events, introduction to service providers

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Get in touch !

Charles Ng Associate DirectorGeneral of Investment Promotion Tel: +852 3107 1002 Email: [email protected]

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