Hong Kong sees 27% increase in Mainland and overseas company set up in 2023

Invest Hong Kong (InvestHK) reported, on 2 February, that it had assisted 382 Mainland and overseas companies to set up or expand their business in Hong Kong in 2023, a year-on-year increase of about 27% as the city regained momentum after its full reopening.

The 382 companies came from 45 economies. Mainland China continued to lead with 136 companies, followed by the UK with 48, the US with 34, Singapore with 27 and Australia with 13.

In terms of sectors, the portfolio covered a broad spectrum ranging from 90 in the financial services and fintech sector, followed by 82 in innovation and technology, 45 in business and professional services, 42 in tourism and hospitality and 34 in consumer products.

The total investment brought into Hong Kong’s economy totalled HKD61.6 billion (USD7.9 billion) and these firms created more than 4,100 job opportunities during their first year of operation.

“Notwithstanding global economic uncertainties, we believe our portfolio growth is gaining good momentum,” said Alpha Lau, InvestHK Director-General of Investment Promotion. “As companies were able to resume their Asian strategies after the pandemic, Hong Kong is a natural first choice as a business base for many global multinationals and entrepreneurs alike.

“We will continue to strive to promote the city’s strengths according to our targets. Financial services, innovation and technology and family offices are among some of the priority sectors, while geographically InvestHK will enhance our promotion drive in strategic markets, including the Middle East and the Association of Southeast Asian Nations economies (ASEAN), maximising Hong Kong advantages as a ‘super connector’ and ‘super value-adder’,” she said.

According to the results of the 2023 Annual Survey of Companies in Hong Kong, there were 9,039 companies in Hong Kong with parent companies overseas and in the Mainland in 2023. The total number of people engaged by these companies was around 468,000.

InvestHK’s 2023 Start-up Survey also showed that the number of start-ups in Hong Kong reached a record high of 4,257, up 272 from the previous year, which had created 16,453 jobs, a 10% increase. They spanned across different business sectors, such as fintech, eCommerce, supply chain management and logistics technology.

Lau also predicted that Hong Kong could surpass Singapore in the number of family offices, despite the current disparity in the number of family offices in the two jurisdictions. The Monetary Authority of Singapore recorded 1,500 family offices in 2022, with 200 more awaiting approval to open in 2023, while the Hong Kong government is targeting 200 by 2025.

“We have already seen a very good number of family offices opening up in Hong Kong because, frankly speaking, we have a better deal, a better tax environment and we are very supportive,” said Lau. “Family offices in Hong Kong, for last year, have already picked up to such an extent that, I believe, in a few more years will surpass Singapore in terms of registrations.”

Lau said InvestHK would continue to prioritise innovation and technology, financial services and family offices. It had contacted 800 family offices around the world since its dedicated team was established in 2021.

InvestHK will also boost its promotion efforts in strategic markets, such as the Middle East and Asean economies. Last year it secured memorandums of understanding (MOUs) with sovereign wealth funds in Saudi Arabia and Egypt for cooperation on investment promotion exchange and support.

Other MOUs signed included ones with the Indonesian Chamber of Commerce and Industry and the commerce authorities of the mainland provinces of Zhejiang and Jiangsu.

Lau added that InvestHK was seeking to open economic and trade offices in Egypt and Turkey, and that one of them would be established this year.