none
Financial Secretary John Tsang
France is our third-largest trading partner in the European Union. Over the past five years, merchandise trade between us has grown by some 14% per year, reaching nearly 9 billion Euros in 2013.
French wine has helped put the shine on those good numbers. Indeed, wine trading between Hong Kong and France has flourished since I abolished, once and for all, our duties on wine in 2008. Between 2008 and 2013, the value of our French wine imports has more than tripled, from some 150 million Euros to 460 million Euros.
Hong Kong people drink more wine from France than wine from any other country. And in terms of value, French wine commands some 60% of our total market share. I must confess that we do like French wine, but we do not consume all the wine that we have imported ourselves. We share this delightful beverage with wine lovers in our region through our highly efficient logistics networks.
The dynamic French business community in Hong Kong has played a significant role in our wine trade, as well as our economic development over the years. Some 20,000 French nationals reside in Hong Kong. And the French Chamber of Commerce in Hong Kong is our largest European chamber. French companies are well represented in Hong Kong. They range from leading international companies to SMEs and start-ups of all kinds. If Hong Kong is the city where West meets East, it does so with a decidedly French flavour.
Growing opportunities
The growing French presence in Hong Kong reflects the business promise of Asia, particularly with regard to the potential of the Mainland of China and the emerging ASEAN economies. It also underlines Hong Kong's role as the natural springboard to these buoyant markets.
Hong Kong has long been the global business centre of Asia, the city where talent and capital come together.
Consider our prime location and sophisticated infrastructure. We are strategically located at the heart of Asia - at the doorstep of Mainland China and the ASEAN region. Half the world's population can be reached within five hours' flight time of Hong Kong. If you don't have your atlas handy, that covers all of China, along with Japan, Korea, most of the ASEAN countries and even eastern Russia. Every day, about 800 flights connect Hong Kong with these regional destinations, with hourly services to a dozen Asian cities.
Some 7,500 overseas and Mainland Chinese companies have a presence in Hong Kong. More than half of them are regional headquarters and regional offices.
We are geographically, culturally and economically connected to the Mainland, the world's fastest-growing economy, with a rapidly expanding consumer market. Hong Kong business people are the biggest foreign investors in every single province of China. We know the Chinese market better than anyone else.
We are also a key player in the emerging ASEAN economies, home to some 600 million people, and a young and ambitious workforce together with a growing middle class. In Hong Kong, you can always find ready partners, knowledgeable professionals and valuable advisers to help expand your business into Mainland China and Southeast Asia.
At the same time, Hong Kong is an international business and financial services centre, blessed with fundamental strengths familiar to many French business people. We make it easy for you to explore the Asian region's lucrative business opportunities.
The Hong Kong way is your way. Ours is a system based on the free flow of news and information, the free flow of people and capital. In short, we bring to the world, to France, both global standards and unlimited Asian opportunities.
Safe investment
We follow the common law legal system, which is fearlessly guarded by our vocal and unfettered media. Judicial independence is guaranteed by our Basic Law, our constitution. We even invite senior judges of other common law jurisdictions to sit on our Court of Final Appeal in making judgments on cases. And we embrace the internationally recognised codes of practice, in business and in commerce, familiar to all of you.
Our government is clean and efficient. We do not tolerate corruption. In our latest annual survey, only 1.2% of respondents said they had experienced some form of corruption in the past year. And this proportion is very low, even among advanced economies.
We guarantee a level playing field for all companies. Big or small, local or international, they are treated equally. Foreign firms, like their local counterparts, can enjoy the same privileges under our bilateral trade agreements. That includes CEPA, our unique free trade agreement with the Mainland. CEPA offers preferential treatment in accessing a wide array of service sectors across the country. So, I encourage French companies to look to CEPA and its advantages in exploring the Mainland market.
Capital flows freely in Hong Kong. And that has helped make us one of the world's leading financial centres, ranked third, currently, behind New York and London in the latest Global Financial Centres Index.
RMB centre
We are the world's premier offshore Renminbi centre. From personal banking services and bond issuances to trade settlement and financing, and the marketing of innovative investment products, Hong Kong plays a critical role in the Renminbi's process of internationalisation.
Hong Kong is a major asset management centre as well. Assets managed from Hong Kong amounted to more than US$2 trillion at the end of last year, an increase of 27% over 2012 totals. Whether you are an experienced fund manager or looking to enhance your assets, Hong Kong is where you want to turn to.
Hong Kong is also the window on the world for Chinese consumers and a lifestyle trendsetter for the Mainland and Southeast Asian consumers. Last year, more than 54 million people visited Hong Kong. That is more than seven times our population. Over 40 million of them came from the Mainland, with about 9 million visiting from the rest of Asia.
Many of them came to Hong Kong for one compelling reason: to shop, to buy brand-name products from all over the world, and to follow the trends set in Hong Kong. French brands have been particularly quick to seize this opportunity, and in sectors ranging from luxury goods to French food and, of course, French wine.
These advantages, together with our central location, our sophisticated transport networks and highly efficient customs procedures, have helped make Hong Kong Asia's logistics hub. This is particularly true in regional distribution and inventory management for high-value goods. Brands like LV, Burberry, Tiffany, A&F, Philips, Canon, Timberland and Schneider Electric have all set up regional bases in Hong Kong to enable just-in-time delivery throughout the Asian region.
I mentioned earlier that you know the Hong Kong way. With, perhaps, one exception. We have low taxes and a simple tax system, which is, I am rather embarrassed to say, not quite the same case here. Our maximum salaries tax rate is 15 per cent - one-five - and the corporate profits tax is a flat 16.5%. We have no VAT, no GST, no capital gains tax, no tax on dividends. And, of course, no tax on wine. That helps keep the compliance and enforcement costs low, and I have been able to return a budget surplus every year since I became Financial Secretary in 2007. Low taxes, I think, also encourage productivity, innovation, labour participation and, of course, business co-operation.
Financial Secretary John Tsang delivered this speech at the opening session of the Think Asia, Think Hong Kong symposium in Paris.
