Hong Kong's international hub role is fundamental
Stephen Phillips

Editor's note: Decision Makers is a global platform for decision makers to share their insights on events shaping today's world. Stephen Phillips is director-general of investment promotion at Invest Hong Kong. The article reflects the author's opinions and not necessarily the views of CGTN.

The year 2022 marks an important milestone for Hong Kong as we celebrate the 25th anniversary of the establishment of the Hong Kong Special Administrative Region (HKSAR). As we look back, there are plenty of economic achievements that we should be proud of, and as we look forward, we see a bright future ahead thanks to our strong ties with our country's economy.

Let us first look at some of the milestones. Since 1997, Hong Kong's per capita GDP grew by 2.2 percent per annum in real terms, reaching $49,800 in 2021. Total merchandise trade value surged from HK$3,071 billion ($391.34billion) in 1997 to HK$10,268 billion ($1,308.45 billion) in 2021, up by 234 percent. The total stock market capitalization rose from HK$3.2 trillion ($0.41 trillion) in 1997 to HK$42.4 trillion ($5.4 trillion) in 2021. Meanwhile, the number of listed companies rose from 658 to 2572. The average daily turnover of the securities market went up from HK$15.5 billion ($1.98 billion) in 1997 to HK$166.7 billion ($21.24 billion) in 2021. Hong Kong ranks third in the latest Global Financial Centers Index. For these reasons and many more, Hong Kong is a leading international business hub. Throughout Hong Kong's history, global status helped our economy grow and diversify, and this is more relevant today than ever as we are playing an increasingly key role in our country's continuous economic advancement. At the same time, this also helps us to attract foreign investment from around the world.

As two of our annual surveys show, 9049 overseas and mainland companies in all sizes and sectors were operating in Hong Kong in 2021, and our city has 3755 startups, 28 percent of which are from outside of Hong Kong. This is a strong testament to our global appeal – both at record levels.

We have earned this on our solid foundations of enduring advantages including an ideal geographical location in Asia, free market mechanism, including free flow of capital and people, the rule of law, our internationally-minded talent pool, plus unrivalled connection with the rest of the business world and more.

But the future is brighter still. With this, Hong Kong is well positioned to benefit from the country's dual-circulation economic development model. On the one hand, many foreign companies leverage Hong Kong platform to access the growing domestic demand of Chinese mainland. On the other hand, mainland companies make use of Hong Kong to connect with the rest of the world tapping opportunities from the external demand.

A sailboat with celebratory posters marking the 25th anniversary of Hong Kong's return to the motherland sails at the Victoria Harbour in Hong Kong, south China, June 23, 2022. /Xinhua

A sailboat with celebratory posters marking the 25th anniversary of Hong Kong's return to the motherland sails at the Victoria Harbour in Hong Kong, south China, June 23, 2022. /Xinhua

For inward investment, the Greater Bay Area (GBA) offers a market of scale, depth and breadth to multinationals and startups based in Hong Kong. A veritable magnet for inbound investment and an opportunity that I say to businesses around the world is too significant to ignore. In fact, as Invest Hong Kong's portfolio show, over 50 percent of companies we assisted in 2021 indicated to us that GBA development is one of the main reasons why they are investing in Hong Kong.  

However, this is just one dimension of GBA. Just as important is the outbound trade and investment from GBA to Hong Kong and beyond, which drives many new commercial opportunities too. What is more, this is all set to be "turbo-charged" by the Regional Comprehensive Economic Partnership (RCEP).

In an ever more complex world, I have no doubt that Hong Kong's role and relevance is global and this will continue. Our precise role is unique to every business. Crucially, the job of my colleagues and I is to help companies formulate the right strategy and plans. I am confident too that Hong Kong's ability to adapt will remain one of its greatest strengths. And I think we are witnessing one of those significant transitions now: from a role at the center of East-West trade and investment, to one that is increasingly about trade and investment flows intra-Asia and hence more north-south.

We have undoubtedly been through a turbulent and challenging period, but throughout my views and confidence have remained resolutely upbeat. At risk of being cliched, for businesses to thrive, it is important to cut through the noise, to see the wood for the trees. Businesses invest on factual information and informed analysis, not headlines.

Myself, my colleagues in Hong Kong headquarters and 31 offices across major mainland and overseas cities communicate on a daily basis with executives in Hong Kong and in different parts of the world, telling them the true Hong Kong story, our strengths, our unique market position in terms of the GBA as well as our Asian connections.

So, as we celebrate Hong Kong's 25th anniversary, we look forward to celebrating even more successes in the years to come. My colleagues and I around the world and across our country look forward to helping even more businesses and entrepreneurs, to make good use of our global role and be part of the country's economic growth. Without a doubt our future will be brighter than ever.

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