Why Hong Kong One of Top 3 World Economic Centers: Before the year 2012 bids goodbye to everyone, the World Economic Forums (WEF) has brought good news to Hong Kong. It earned the top spot for being the best and most efficient country in terms of banking financial services; beating the United States and the United Kingdom, which ranked second and third respectively. This is the second consecutive year of the country in this position and is greatly welcomed by everyone, particularly its financial secretary, John Tsan Chun-wah.
Letting the Numbers Speak: A Glimpse at the Economic Statistics of Hong Kong
The news of Hong Kong as the freest economy around the globe, as per calculated and observed in its 2012 Index, gave more reasons for investors to start appreciating the many advantages it is ready to offer for their business growth and development.
Some are as follow:
Statistical Results in Relation to Rule of Law Compared to Last Year’s Results
- Property Rights 90.0 (relatively stable)
- Freedom From Corruption 84.0 ( higher)
While US and Europe were struggling to keep their economy stable, Hong Kong showed resilience in this global turmoil. It remained competitive thanks to its effective and high-quality legal framework strongly protecting the property rights of its citizens, yet allowing the promotion of freedom of exchange. The government has also kept close watch in full support of the rule of law, as seen in its quest to fight corruption and independent power given to the judiciary that is separate from the legislative and executive branch of the government. With these two elements intact, Hong Kong remains the most competitive financial and business center in the world.
Statistical Results in Relation to Regulatory Efficiency Compared to Last Year’s Results
- Business Freedom 98.9 ( higher)
- Labor Freedom 86.5 ( higher)
- Monetary Freedom 85.8 ( lower)
These numbers reveals Hong Kong’s openness to global commerce and entrepreneurial dynamism. Its strong ties with China felt stronger intensity for the year 2012, which has produced more financial linkages that has been well capitalized by the business leaders of the country, and with the establishment and implementation of the minimum wage in the year 2010, it has pushed the country’s labor force into greater regulation, much to the advantage of business owners in the region. Nevertheless, the government has still control of all its land.
Statistical Results in Relation to Open Trade Compared to Last Year’s Results
- Trade Freedom 90.0 ( stable)
- Investment Freedom 90.0 (stable)
- Financial Freedom 90.0 ( stable)
The zero tariff rate applied by Hong Kong and its minimal non-tariff barriers is an addition to the elements pushing and maintaining its positions as one of the top 3 world economic centers. These factors are more than enough to attract more foreign investors into the country and with its impressive prudent regulatory enforcements and high degree of transparency, its role as one of the best places to invest in the world has been sealed.
Statistical Results in Relation to Limited Government Compared to Last Year’s Results
- Government Spending 91.0 ( higher)
- Fiscal Freedom 93.1 ( lower)
The simple yet efficient tax system of Hong Kong, equivalent to an income tax rate of 15% and corporate tax rate of 16.5% is enough to support the Government spending corresponding to 17.3% of its GDP. With a record of large surplus with the budget balance, it has also reduced tax rebates and per capita cash payments resulting to low public debt that is admired by almost all nations in the world.
If these numbers fail to impress any investor then these additional information may motivate you to start investing in Hong Kong today.
- 7% GDP growth rate
- 3.9% 5 year compound annual growth rate
- $45,736 per capita rate
- FDI inflow of $68.9 billion
- Inflation rate of 2.4%
- Unemployment rate of only 4.4%
These numbers justifies the position of Hong Kong as the top business center in the world. The world financial analysts agree and even other world government approve of this conclusion.