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The number of business operations in Hong Kong with parent companies overseas and in the Mainland climbed to a new record of 7,904 in 2015, an increase of 4.2 per cent on a year ago, according to a joint survey conducted by Invest Hong Kong (InvestHK) and the Census and Statistics Department (C&SD) released today (October 26).
The results of the "2015 Annual Survey of Companies in Hong Kong Representing Parent Companies Located Outside Hong Kong" show that the 7,904 respondent companies included 1,401 operating as regional headquarters (RHQs), 2,397 as regional offices (ROs) and 4,106 as local offices (LOs). The numbers of RHQs and LOs represent a record high.
In terms of jobs, the 7,904 companies combined employed about 422,000 people, an increase of 4.3 per cent compared to 2014 and also a record.
In terms of source country/territory, the US ranked first with 1,368 companies in Hong Kong, followed by Japan (1,358), Mainland China (1,091), the UK (631) and Taiwan (413). Among the top 10 source countries/ territories, Mainland China showed the strongest growth, rising by 14 per cent from a year ago.
By sector, import/export trade, wholesale and retail topped the list (3,482 companies, or 44.1 per cent of total), followed by finance and banking (1,438 companies, 18.2 per cent), and professional, business and education services (1,353 companies, 17.1 per cent). Of these three sectors, finance and banking showed the strongest growth with an increase of 9.8 per cent on a year ago.
Put in the context of a five-year period, the number of respondent companies with parent companies located in the Mainland, and companies engaged in the financing and banking sector saw even bigger growth, both climbing by 36 per cent from 805 and 1,059 respectively in 2011.
The Director-General of Investment Promotion, Dr Simon Galpin, welcomed the positive numbers, and in particular the surge in the number of Mainland companies and financing and banking firms in Hong Kong.
"The significant increase in the number of Mainland enterprises reaffirms Hong Kong's unique role as the major springboard for Mainland companies to go global. The growth in the last five years in the numbering of financing and banking companies demonstrates Hong Kong's position as an international financial hub in the world," Dr Galpin said.
He noted that as the Mainland continues to open up its economy and financial markets and on the back of the Belt and Road initiative, Hong Kong will continue to be the "super-connector" helping the nation in its gradual economic reform, which would also generate many new business opportunities in different economic segments for foreign investors in Hong Kong.
The annual survey aims to collect information on the profile of these companies and their views on the business environment of Hong Kong.
In terms of size, the majority of the respondent companies were of small and medium size, with 5,441 companies engaging fewer than 20 persons and 1,189 companies engaging 20 to 49 persons.
The top three factors that affected the choice of Hong Kong as an RHQ/RO/LO were: (1) simple tax system and low tax rate (68 per cent of the companies surveyed considered the factor as favourable for Hong Kong), (2) free flow of information (63 per cent), and (3) free port status (59 per cent).
Survey definitions
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Regional Headquarters: an office that has managerial control over offices in the region (i.e. Hong Kong plus one or more other places) on behalf of its parent company located outside Hong Kong.
Regional Office: an office that co-ordinates offices and/or operations in the region (i.e. Hong Kong plus one or more other places) on behalf of its parent company located outside Hong Kong.
Local Office: an office that only takes charge of the business in Hong Kong (but nowhere else) on behalf of its parent company located outside Hong Kong.
Survey methodology
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Data collected in the 2015 survey refer to the position as at June 1, 2015. Owing to the lack of a complete sampling frame of companies covered in the survey, the number of RHQs, ROs and LOs enumerated in each survey round represents only the best snapshot that could be taken at the time of the survey. Coupled with the voluntary nature of the survey, changes between years in the number of RHQs, ROs and LOs may be affected by the continuous improvement in the sampling frame of companies and response rate. Nonetheless, a high response rate of 97 per cent or above has been achieved in each round of the survey since 2003, and thus the effect of the response rate is relatively insignificant. Additionally, changes between years in the total number of people engaged in these companies may also be affected by the response patterns of companies of different employment sizes. Still, with all the limitations mentioned above, the relevant changes should be interpreted with some caution.
The survey results are published in greater detail in the "Report on 2015 Annual Survey of Companies in Hong Kong Representing Parent Companies Located outside Hong Kong" by the C&SD. The publication is available for download free of charge from the C&SD website at: www.censtatd.gov.hk/hkstat/sub/sp360.jsp?productCode=B1110004 .
Enquiries about the survey results may be directed to the Business Expectation Statistics Section of the C&SD (Tel: 3903 7263).
About InvestHK
InvestHK is the department of the Hong Kong Special Administrative Region Government established in July 2000 to attract foreign direct investment and support overseas and Mainland businesses to set up or expand in Hong Kong. It provides free advice and customised services to help businesses succeed in Hong Kong's vibrant economy. As at June 2015, InvestHK had assisted over 3,700 companies which created a total of more than 40,200 new jobs in the first year of operation or expansion and over HK$99 billion of investment. For more information, please visit www.investhk.gov.hk .
For event photos, please visit www.flickr.com/photos/investhk/albums/72157659626186220.
Ends/Monday, October 26, 2015
Issued at HKT 14:26
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