Press Release - January 8, 2002

2001 has been a very productive year for Invest Hong Kong (InvestHK) of the Hong Kong Special Administrative Region Government. Over the past 12 months, the department attracted and successfully assisted 99 foreign companies in setting up or expanding existing operations in Hong Kong -- generating total investment of HK$3.5 billion and creating over 1,500 jobs.

The Director-General of Investment Promotion, Mr Mike Rowse, said today (January 8 in Hong Kong): "Over the last year, we have seen a continuing strong international interest in Hong Kong as the preferred location for regional headquarters. More and more multinational corporations have been capitalising on our unique position as the gateway to China, and establishing a business presence here."

Mr Rowse referred to two indicators of Hong Kong's attractiveness to foreign investors as a place to do business: the number of foreign-owned Regional Headquarters (RHQs) and Regional Offices (ROs), and the flow of Foreign Direct Investment (FDI).

"As at June 1, 2001, the Census and Statistics Department's Annual Survey of Regional Offices Representing Overseas Companies in Hong Kong showed a record number of RHQs (944) and ROs (2,293) in Hong Kong, representing an increase of some 8 per cent over the 2000 survey result. As for the period from June to December 2001, we noted from media reports that at least another 33 new RHQs have been established here," he said.

"The other major indicator is the report on FDI. According to the World Investment Report 2001 published by the United Nations Conference on Trade and Development, Hong Kong recorded an FDI inflow of HK$502 billion (US$64.4 billion) in 2000. Hong Kong and Mainland China are by a wide margin the two largest FDI recipients in Asia."

There was also a record FDI outflow of HK$490 billion (US$63 billion) in 2000. "This illustrates Hong Kong's role as premier fund-raising centre for businesses in the region. China's membership in the World Trade Organisation (WTO) further underlines Hong Kong's importance," added Mr Rowse.

"For the first three quarters of 2001, the Census and Statistics Department reported an FDI inflow of HK$162.2 billion (US$20.8 billion) in Hong Kong. These figures confirm a sustained interest in inward investment in Hong Kong."

Welcoming the findings, the Director of the Hong Kong Economic and Trade Office (Canada), Mrs Rosanna Ure, said she was very pleased with Invest Hong Kong�s performance over the past 12 months.

�This is a very good indication to the Canadian community that business and investment opportunities are ample in Hong Kong especially at this time when China has entered the World Trade Organisation as a permanent member.

�We firmly believe it is high time that Canadian investors should capitalise on Hong Kong�s advantage as the gate to China and as a logistic centre for business in the China market,� Mrs Ure added.

Referring to the positive findings, Mr Rowse said: "We know that we have to continue to work hard to maintain Hong Kong's competitiveness to attract foreign investment."

"As overseas companies are eyeing the enormous business opportunities following China's entry into the WTO, we will strengthen our services in this aspect," he added.

"For example, The Economic and Trade Office in Guangzhou, incorporating an investment promotion desk, will be established later this year.

"Internally, we have completed recruitment of all investment promotion staff and streamlined the operation of overseas investment promotion desks to increase efficiency.

"We have formulated strategies and business plans for our nine priority economic sectors. Business plans for investment promotion desks in overseas Economic and Trade Offices have also been mapped out."

During the past year, InvestHK took part in a number of international conferences. The Fortune Global Forum in May, of which InvestHK was a host sponsor, was a huge success with an attendance of some 600 delegates and government officials.

At the World Services Congress held in Hong Kong last September, InvestHK highlighted Hong Kong's role as a "Compradore City" as China entered the WTO.

InvestHK also took part in the World Economic Forum's 10th East Asia Economic Summit in October, at which some of the world's finest business minds shared expertise and experience on the issues currently affecting East Asia. The event was very well attended, which was significant bearing in mind that it took place just a few weeks after the terrorist incidents in the USA had deterred many people from travelling, and other business events were being cancelled.

InvestHK sponsored the annual convention of CASBAA (Cable & Satellite Broadcasting Association of Asia) in November, which featured special conference sessions dedicated to the China and Hong Kong markets; and the 2001 conference of Asian Securities Analyst Federation in December, which explored the opportunities open to the securities industry in Asia.

In 2001, the Director-General of Investment Promotion made nine overseas trips covering Japan, Singapore, Australia, Mainland China, Italy, Germany, the United Kingdom, France and the United States as part of Invest Hong Kong's proactive strategy to reach companies who may be considering expanding into the Asia Pacific region.

Looking ahead, Mr Rowse said: "We will continue to liaise with the international business community to attract to and retain in Hong Kong economically and strategically important investment.

"Our vision is to confirm and strengthen Hong Kong as the leading international business location in Asia."

Mr Rowse added: "We will embark on a series of image building and public relations activities to attract more investment to Hong Kong, through organising or participating in major conferences or events such as the Rugby 7s in March and the Economist Corporate Network Conference on Asia to be held in Seattle in April 2002.

"We will continue our sponsorship of the yacht 'Spirit of Hong Kong'. In addition, an announcement of another major sponsorship initiative will be made later this week in London."

For further information please contact, Chief Information Officer, John Tam, at tel: 416-924-5544 or e-mail: [email protected], or Senior Information Officer, Elison Chu, e-mail: [email protected].