HSBC Treasury Management Profiles 2018 -

Current section, Introduction


Hong Kong is the world’s most services-oriented economy, with the services sector contributing more than 90 per cent of GDP1. An attractive location for foreign direct investment – in 2016, the territory received total inflows of USD108 billion2 – Hong Kong serves as the regional headquarters (1,413) or regional offices (2,339) multinational companies managing operations in Asia Pacific3, and in particular the Chinese mainland. Of the 3,371 companies, 77 per cent were responsible for business in the Chinese mainland4. Hong Kong is becoming increasingly integrated with China, its largest export and import partner. Hong Kong is the largest source of overseas direct investment in the Chinese mainland (44.7 per cent of all overseas funded projects in China in 20165), while the Chinese mainland is a leading investor in Hong Kong. In June 2017, it signed the Economic and Technical Cooperation and Investment Agreement under the framework of CEPA (Closer Economic Partnership Agreement, signed by the two countries in 2003)6. This latest agreement gives preferential treatment to local companies in both service and non-service sectors. Hong Kong’s GDP grew 4 per cent year-on-year in the first half of 20177, supported by robust trade figures (the value of total exports of goods increased 8.8 per cent year-on-year8), strong employment figures (the unemployment rate was 3.1 per cent9) and an upturn in the global economy.

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Legal and regulatory

  • Foreign exchange accounts and domestic currency (HKD) accounts can be held by residents both domestically and abroad. Resident domestic currency accounts are freely convertible
  • Non-resident bank accounts are permitted in both foreign and domestic currency. Non-resident domestic currency accounts are freely convertible
  • Residents and non-residents are permitted to hold RMB accounts
  • Hong Kong does not apply exchange controls

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  • Hong Kong adopts the ‘territorial-source principle’ in charging profits tax. Both resident and non-resident companies pay tax on Hong Kong-sourced income
  • The corporate tax rate is 16.5 per cent. Unincorporated businesses are taxed at a standard rate of 15 per cent
  • There is no withholding tax on interest and dividends paid to resident or non resident companies

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Payment instruments and systems

  • Electronic credit transfers and cheques are used for both high-value corporate and low-value retail payment transactions. Credit transfers and cheques can be denominated in HKD, USD and RMB. A cross-border, one-way, e-check clearing service of HKD, USD and RMB e-Checks between Hong Kong-Guangdong and Hong Kong-Shenzhen was launched in July 2016. Nine banks offer the e-Cheque issuance service via their internet/mobile banking platforms. E-money schemes are hugely popular – 99 per cent of all residents use e-money cards
  • Hong Kong operates a number of national payment systems: HKD, USD, EUR and RMB payments are cleared by their respective CHATS RTGS payment systems. There is a CLG system for cheques and an ECG system for low-value payments

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Cash management

  • Domestic and cross-border notional pooling and cash concentration is permitted between resident and non-resident companies
  • A range of collections services are available, including lockbox services

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Electronic banking

  • Electronic banking is commonplace in Hong Kong. There is no bank-independent electronic banking standard
  • Internet and mobile banking services are provided by all of Hong Kong’s banks for both corporate and retail purposes
  • An EBPP platform allows individuals and companies to make payments via online or mobile bank accounts. Nineteen banks provide the EBPP service at present

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2 UNCTAD World Investment Report 2017






8 External merchandise trade statistics for June 2017 [27 Jul 2017]

9 HKSAR Census and Statistics Department; Unemployment and underemployment statistics for April - June 2017 [18 Jul 2017]


Additional sources:

  • UNCTAD World Investment Report 2017
  • Invest HK. Hong Kong: The Regional Business Hub
  • Hong Kong Economy: The Government of the Hong Kong Special Administrative Region
  • HKSAR Census and Statistics Department

The materials contained on this page were assembled in June 2017 (unless otherwise dated).



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