NCPA - National Center for Policy Analysis

Study: Hong Kong Beats Out Rivals As Asian Business Address

January 10, 2001

A new study names Hong Kong as the city of choice for companies seeking to locate offices to serve Asian markets. It beats out Singapore and Tokyo in a survey of more than 1,100 European, Japanese and American firms conducted by University of Hong Kong visiting professor Michael Enright and international business consultant Edith Scott.

Hong Kong's laissez-faire respect for business has long made it popular among those wishing to set up regional headquarters. But growing smog and rising rent and labor costs have prompted concerns among officials that company executives might be attracted to rival cities. So the report helped calm their fears.

  • Despite the British pull-out several years ago, Hong Kong still scores high in political and legal stability, infrastructure, professional services and the quality of local managers.
  • Costs and quality-of-life issues come further down on companies' lists of priorities, the study found.
  • Singapore is much farther than Hong Kong from investment hot spots such as China, Japan and South Korea.
  • While companies may increasingly use Singapore as a base for dealings in Southeast Asia, it suffers because of perceived instability in neighboring Indonesia.

Tokyo came in a distant third because many respondents said managers based there found themselves overwhelmed with managing their Japanese operations and unable to effectively coordinate work elsewhere in the region.

Source: Gren Manuel, "Hong Kong Tops the List in Asia for Business Locations, Study Says," Wall Street Journal, January 10, 2001.


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