IMF overviews Hong Kong economy

23.05.2014

IMF Report considers that financial system of Hong Kong is good regulated, and its bank system is stable. Domestic demand remains stable in the markets. The level of expected inflation leaves about 4%. Labor market provides strong performance: the unemployment rate is expected only slightly to exceed 3%.

Hong Kong is a small and open economy, and because of this it is influenced by international markets.

It was found that the banking system is robust to changes in liquidity. Branches of foreign banks are in the least protected position since they rely on the parent companies in the financing of their activities.

Tax reserves exceed 35% of GDP and income from taxes and fees to the allowed Hong Kong budget to remain in surplus over the past fifteen years.

Source: http://www.imf.org/external/pubs/cat/longres.aspx?sk=41577.0

Expert’s opinion

Despite the fact that Hong Kong is not an big area, it is one of the largest financial centers in the world today. Of course, Hong Kong is an attractive jurisdiction for foreign capital because of minimal restrictions for businesses in jurisdiction. Preferential tax treatment for business activities outside the territory of Hong Kong is also supports the flow of investment.

It is worth saying that in the time of worldwide economic and financial crisis, Hong Kong is pleasing businessmen with its stability. Foreign firms continue to register their offices in Hong Kong and to open a bank accounts, that only has a positive effect on the economy of the region.

Anna Shevchenko ( Lawyer, Honest&Bright)