- Hong Kong’s western economic fundamentals.
- Momentarily Beijing seems to take the place along with its other Asian contenders.
- The flow of money in China isn’t easy to replicate.
Hong Kong has been the gateway between businesses in China and the West, including giving companies that operate on the mainland a way to access money to fuel their business becoming the global business hub as reported by BBC News.
Hong Kong’s Growth
Riding the wave of China’s meteor economic rise in the last 40 years, hong kong has been able to move from cotton spinning to manufacturing into financial & commercial services, giving companies around the world a place to do their banking, borrow money & sell shares.
Hong Kong has a lot to offer – low taxes the fact that money could move in & out easily, a stable business environment & a legal system based on that of the UK. It attracted companies from all over the world.
What makes hong kong so unique is its economic fundamentals remain firmly western.
This status as a global financial centre & the catch that comes with it has made hong kong what it is today a thriving buzzing metropolis. But hong kong’s future as a global financial centre is in doubt.
It’s Asian Contenders
Shortly, Beijing will control the future of Hong Kong & that’s what challenges Hong Kong to remain as an international financial centre.
But there are plenty of cities in the region who became to take their place. The Lion City, Singapore seems an obvious contender. Its got a stable government and has many of the same benefits that hong kong does: low taxes, an easy business environment & lower rent but besides its financial system, it’s far smaller than Hong Kong. its stock market, for instance, is that of 7th of the size of Hong Kong.
Then we have Tokyo a major financial centre already, but japan has some hurdles including high taxes & a language barrier meanwhile Sydney is pouring billions into its Silicon Valley calling the area Tech Central; high taxes & its geographic remoteness though is a challenge to it becoming a financial hub.
And that’s not to mention the other contenders such as Bangkok, Taiwan, Seoul or even Chinese cities such as Shanghai & Shenzhen, it won’t be easy though to replace hong kong.
The flow of money that comes in & out of hong kong daily that goes into mainland china & comes out is very hard to replicate.
So, as long as the money is flowing the bright lights of hong kong will stay on.
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Source: BBC News
