Ease Of Doing Business In Hong Kong: Returning To China & Reviving Your Business

If you’re someone who has left Hong Kong in the past three years, you’re not alone. Almost three years of pandemic restrictions have devastated Hong Kong’s economy, forcing so many residents and businesses to move overseas.

Hong Kong’s population drop of 1.6% during this period was the largest in at least six decades. In fact, the local workforce shrunk by about 140,000.
Meanwhile, an agile, talent-hungry Singapore, having adopted an intelligent ‘living with COVID’ strategy, has made swift moves to capitalise on Hong Kong’s woes. As a result, it has overtaken that city to become Asia’s top financial centre.

Amidst all the gloom, is there any good news for Hong Kongers?

For the business-minded, there is. Just as the ancient Chinese military strategist Sun Tzu wrote in the 5th Century BC, there is always opportunity in the midst of chaos.

Government efforts to rebuild Hong Kong’s business infrastructure

Efforts to rebuild the city’s reputation and business infrastructure are already well underway, even if things will be heading in a different direction than before. The new powers-that-be in Hong Kong are determined to see the city regain its mantle as an Asian business haven, and recently unveiled a pro-active economic blueprint to reboot the city as an attractive international hub for business.
Among the measures rolled out were HK$30bn ($3.8bn) for a new investment fund to attract overseas businesses and make it easier to hire foreigners in 13 key professions.

The city will also give preferential treatment to “top talent”, described as people who earn HK$2.5m ($320,000) or more annually and graduates from the top 100 universities around the world who have relevant working experience. Overseas talent who paid extra taxes when buying property in Hong Kong can receive a refund when they become a permanent resident, a status available after living in the city for seven years.

The city’s 2022 Budget also incorporates multiple measures that focus on strengthening Hong Kong’s position as an international trade and financial centre, including various tax and non-tax measures to support the maritime and port sector as well as Hong Kong’s innovation and technology sector.

Business is resetting and rethinking strategies for growth

In tandem with these Government activities and initiatives, many business executives are now rethinking and resetting their strategies for growth, with added determination. Though down, Hong Kong is certainly not out. It’s also a city that’s no stranger to danger. From the 1998 financial crisis to the SARS epidemic, Hong Kong has continually bounced back. If nothing else, it is a resilient business environment, one of the world’s best in that regard.

It also remains – at least on paper – one of the best places in Asia for doing business.

In an uncertain world, Hong Kong has several critical advantages. Among them is its strategic location, business-friendly environment and traditions, and a unique east-west cross-over history. For business in the West, it represents a vein-way into China’s beating heart. For China, it offers an open door into the western business world. But it needs to please both masters – these days a delicate and difficult balancing act.

Some optimists maintain though that Hong Kong could well become the place where China and the Western world eventually come to terms with each other in a geo-political marriage of convenience and mutual respect; with a union that works for all parties

Evidence of a business turn-around is emerging

At ground level though, many are still hesitant about a return to Hong Kong after three years of chaos. Others though are impressed by the Government’s recent efforts to rebuild Hong Kong’s business infrastructure. Certainly, there is evidence of a turn-around. For example, major business chambers in Hong Kong have recently reported green shoots in the form of an increase in membership, as more people either return to the city or explore local opportunities for growth following the relaxation of Covid-19 travel curbs.

As part of the general business reboot, Hong Kong is now welcoming returnees with open arms, especially those with much-needed corporate credentials. Many businesses planning a return, or that are actually in the process of making their comeback, are working with workforce/business specialists like CXC to streamline their re-entry and make the most of all the opportunities and Government assistance available.

CXC has been operating in Hong Kong for many years now and understands the business environment there intimately. Our experienced and highly knowledgeable staff stand ready to assist any business wanting to re-enter the Hong Kong marketplace in areas such as talent recruitment and sourcing, workforce management, networking and introductions, business expansion, payroll outsourcing and more.

Like to know more about how best to plan your business re-entry or expansion into Hong Kong? Or any other country in Asia? Or do you need assistance starting a business in Hong Kong? Get in touch with CXC today to explore how our solutions can help take your business to the next level!