Hong Kong is more entrepreneurial, open and diverse than Singapore, finance chief Paul Chan tells US businesses

29th May 2024 – (Hong Kong) In a recent address to US business leaders in San Francisco, Hong Kong’s Financial Secretary Paul Chan Mo-po highlighted the city’s unique strengths as a business destination, particularly in comparison to its regional rival, Singapore. Chan’s statements shed light on the competitive advantages that make Hong Kong the preferred choice for entrepreneurs and companies seeking to establish a presence in Asia.

One of Hong Kong’s most significant advantages is its entrepreneurial spirit and open, diverse business environment. As Chan noted, “Hong Kong is a lot more entrepreneurial. When it comes to the entrepreneurial spirit and innovation, I think you’ll find it more interesting … Hong Kong is [also] more open and diverse.” This vibrant, dynamic atmosphere fosters creativity and innovation, making it an ideal breeding ground for startups and established businesses alike.

In contrast, while Singapore offers generous government support for small businesses, it comes at the cost of strict regulations and lengthy permit processes. Hong Kong’s more liberal approach to business allows companies to hit the ground running, with fewer bureaucratic hurdles to navigate. This agility is particularly valuable in today’s fast-paced business landscape, where the ability to adapt quickly can mean the difference between success and failure.

Another key factor that sets Hong Kong apart is its unparalleled connectivity to mainland China and the broader Asian market. As Chan emphasised, “Come talk to us. Depending on the scale of the investment, the size of operation, the stage of the technology that you’re bringing, we can tailor-make specific packages for you.” Hong Kong’s strategic location and well-established business ties make it the perfect springboard for companies looking to expand into the world’s second-largest economy and the rapidly growing markets of North Asia.

Moreover, Hong Kong’s stock market offers a distinct advantage over Singapore’s, with Chan describing it as “no comparison in terms of depth and breadth.” The market capitalisation of companies listed on Hong Kong’s stock exchange stood at an impressive HK$32.1 trillion, dwarfing Singapore’s HK$7.4 trillion. This depth and liquidity provide companies with greater access to capital and more opportunities for growth.

While Singapore may boast a larger and more diversified economy, Hong Kong’s unique positioning as a gateway to China and its thriving financial sector make it an indispensable hub for businesses with ambitions in the region. The city’s world-class infrastructure, highly skilled workforce, and favourable tax regime further enhance its appeal as a business destination.

The signing of a memorandum of understanding between InvestHK, Hong Kong’s investment promotion agency, and the Bay Area Council, a California-based business association, underscores the growing interest in Hong Kong among U.S. businesses. The agreement, which focuses on joint promotion of investment in green finance and sustainable development, highlights Hong Kong’s commitment to fostering innovation and embracing the challenges of the future.

As part of a joint delegation with representatives from Macau and Guangdong province, Chan’s visit to San Francisco and Berkeley aims to promote business opportunities in the Greater Bay Area, a bold initiative by Beijing to create a hi-tech economic powerhouse in the region. This collaborative approach demonstrates Hong Kong’s pivotal role in driving economic growth and innovation in the Greater Bay Area and beyond.

In an increasingly competitive global business landscape, Hong Kong’s unique blend of entrepreneurial spirit, open economy, and strategic location make it the clear choice for companies seeking to establish a presence in Asia. As Chan stated, “Talent, goods and data are movable,” and Hong Kong provides the ideal platform for businesses to thrive and grow in the region.

While Singapore remains a formidable competitor, Hong Kong’s distinctive advantages and unrivalled connectivity to China and the broader Asian market set it apart as the ultimate destination for entrepreneurs and businesses with ambitions in the region.