The International Monetary Fund (IMF) staff mission made an assessment in a statement released December 12, 2018 after consultation with HKSAR on Article IV in 2018.
Finance Minister Paul Chan welcomed the encouraging IMF forecast for Hong Kong and the confirmation of strong city buffers and robust political frameworks. He said that despite the fact that Hong Kong is well positioned to meet the challenges ahead, the Government will remain vigilant in monitoring risks and will not regret efforts to increase economic activity and promote economic growth. To support long-term growth, the Government is working to increase labor force participation and further enhance Hong Kong’s competitiveness.
According to a new survey conducted by investment promotion body InvestHK, the Sino-US trade tensions have so far failed to stop the creation of foreign enterprises in Hong Kong. The latest study conducted by the group showed that the number of foreign companies or enterprises headquartered on the mainland operating in SAR reached 8,754 this year compared with 8,225 a year earlier – an increase of 6.4%. The research showed that the low tax rate and simple tax system were the biggest attraction for foreign companies, accompanied by free flow of information, free port status and geography.
InvestHK's research also revealed an 18 percent increase in the number of startups which operate in Hong Kong`s co-working spaces and business incubators.
Stephen Phillips, the general manager of investment promotion, saw a reason for optimism in the coming year and said that looking at the economic foundations of Hong Kong, China, and Asia more broadly, they will remain strong, but this does not mean that trade tensions cause some uncertainty.
The large investors are looking at how to respond to tensions, but Hong Kong will continue to play an important role due to its location.
