Regional Headquarters

Hong Kong's strategic location - no more than five hours from any of Asia's business centres - and its world-class infrastructure and services have propelled it into the ranks of a handful of "world cities". Just as New York serves as North America's business capital and as London as Europe's business capital, Hong Kong occupies the same niche in Asia.

That is why a total of 3,798 overseas companies had regional operations in Hong Kong as at June 2005. This breaks down to 1,167 regional headquarters and 2,631 regional offices. This is a record high since the survey started 14 years ago.

About 53 per cent of the regional headquarters (RHQs) in Hong Kong are engaged in wholesale, retail and trade-related services; 23 per cent are in business services and 9 per cent in transport and related services.

The top five important factors attracting companies to establish their RHQs or regional offices(ROs) in Hong Kong are:

• Low and simple tax system;
• Free flow of information;
• Corruption-free government;
• Absence of exchange controls; and
• Communications, transport and other infrastructure.

Hong Kong stands out as a beacon of free trade in goods and services. The environment, especially for global services providers, in many parts of the region is restrictive for non-national companies.

While many countries are gradually attempting to liberalise their services sector, they have a long way to go to catch up with Hong Kong - a free port for more than a century and a half. Hong Kong's position as the most important RHQ base in the Asia-Pacific is likely to strengthen in coming years.