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Hong Kong: Asia’s Financial Hub

investing in Hong KongHong Kong, while technically a part of China, is also its own separate entity. It remained a British colony for 99 years and was only given back to China in 1997. Because of this, Hong Kong maintains a distinct identity as it has a democratic political system, more advanced economy and different way of thinking than the Chinese mainland.

At one time a backwater of no more than a few thousand fishermen, Hong Kong experienced rapid economic development from the 1960s through to the 1990s and is now a highly developed service economy that serves as China’s gateway to the west.

The fisheries from old-times have been replaced with massive skyscrapers. Today, the island is one of Asia’s largest financial and business centers. It also has claim to the largest seaport in in the entire world.

One of Hong Kong’s unique advantages is its geographical location placing it at the heart of Asia as it lies on the border of China and the rapidly developing economies of ASEAN. Due to this, Hong Kong serves as a perfect base to expand into China and Southeast Asia.

Many other people have recognized the city’s potential as a hub, as it is the third largest recipient of foreign direct investment in the world.

Investing in Hong Kong is not without certain problems though. Being a relatively small island, it does have issues with land shortages and the price of real estate is immensely high.

The government has recently attempted to solve this problem by imposing additional taxes on purchases of real estate by foreigners in order to make property a less attractive investment and lower prices.

Land reclamation from the sea has also been practiced in Hong Kong since the mid-19th century and much of Hong Kong, including Disneyland and their international airport, is now comprised of reclaimed land.

The Hong Kong Stock Exchange is the 6th largest in the world by market capitalization and also the second largest in Asia. Many international firms from the rest of Asia, as well as the U.S. and Europe are traded on it.

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