Investimento estrangeiro direto em Hong Kong SAR, China

FDI in Figures

According to the World Investment Report 2023 released by UNCTAD, Hong Kong received USD 117.7 billion in FDI in 2022, down by 16% compared to the USD 140.1 billion recorded one year earlier. Despite the decrease, Hong Kong was the fourth receiver worldwide. At the end of the same year, the total stock of FDI stood at USD 2.09 trillion, around 579.1% of the country’s GDP. Examining the primary sources of investment, the British Virgin Islands and mainland China are Hong Kong's top contributors to inward direct investment, accounting for 30.9% and 30% respectively of the stock at the end of 2022. Regarding the major economic activities of Hong Kong enterprise groups receiving FDI, those involved in investment and holding, real estate, and professional services held the largest share, totaling 65.4%, followed by banking at 13%, while import/export, wholesale, and retail trade comprised 10.9% (data Census and Statistics Department). According to the same source, 3,647 overseas companies had regional operations registered in Hong Kong as of 2023.

With advanced institutions and regulatory systems, Hong Kong's economy thrives on competitive sectors such as finance, professional services, trade, logistics, and tourism. Hong Kong maintains equality in law and practice between investments by foreign-controlled and local companies. Foreign entities can establish operations, register foreign branches, and set up representative offices in Hong Kong without facing discrimination or excessive regulation. Ownership of these operations faces no restrictions. Hong Kong generally adheres to a free-market philosophy with minimal government intervention in economic matters. Capital gains remain untaxed, and there are no withholding taxes imposed on dividends and royalties. Moreover, profits are freely convertible and can be remitted without restrictions. On the other hand, factors potentially impeding FDI in Hong Kong include the lack of innovation and diversification in the economy, vulnerability to slowdowns in mainland China, disparities in business cycles between the United States and China due to the HKD-USD peg, risks within the real estate sector, particularly concerning housing affordability, and the upward trend in income inequality. Overall, Hong Kong has an excellent business climate, and it ranks 17th among the 132 economies on the Global Innovation Index 2023 and 14th out of 180 countries on the 2023 Corruption Perception Index.

What to consider if you invest in Hong Kong SAR, China

Strong Points

Hong Kong is an international leader in terms of international trade, a services centre with high added value and the bridgehead to one of the largest production bases in the world, China. Hong Kong has a sound economy and a stable and efficient financial and banking system. Key strong points for FDI in Hong Kong include:

• Favourable tax measures
• The transparency of local institutions 
• Freedom of information 
• Availability of qualified human resources  
• Its advantageous geographical location in Asia

Weak Points

Disadvantages for FDI in Hong-Kong include:

• High cost of property and work space (offices, shops, etc.)
• High cost of salaries, compared to other Asian countries such as Mainland China and India
• The excessive importance of the financial sector in national economy

Government Measures to Motivate or Restrict FDI

Hong Kong is a free territory for investments, which are in fact encouraged by the government with a favourable taxation policy and light legislation. Foreign companies can be set up freely, register their brands and the director of the company doesn't have to be a citizen nor a resident of Hong Kong. The government has also put in place numerous initiatives to support business innovation.

Bilateral investment conventions signed by Hong Kong SAR, China

To see the list of investment treaties signed by Hong Kong, consult UNCTAD's International Investment Agreements Navigator.