The dynamics of the Hong Kong market and its growth prospects for 2021
Reattached by China in 1997, Hong Kong is seen as a link between the Chinese market and the world. The island of just 1100 square kilometers is extremely important to the international economy. The semi-autonomous territory has been thriving in recent years and has developed more and more, being able to efficiently carry out large-scale trade, given that more than 60% of Chinese businesses pass through the island, according to the Development Council Hong Kong Commerce (HKTDC) and the territory occupied the 4th position in 2019 in the feasibility of doing business with the World Bank, thus proving to be a great hub for investment today.
Easy overcoming of crises in Hong Kong
Although downturns in its economy occurred in 2020 due to the COVID-19 pandemic, overcoming crises is nothing new for the territory that has known how to behave well in the face of several crises, whether financial (such as the Asian and the 2008 ones), or sanitary (such as SARS), always appearing in the most competitive economies in the world and with a growing GDP year after year. This economic success can be attributed in large part to its economic opening and heavy foreign investments carried out on the island by various means, be they stock exchanges or even multinational companies. In addition, the contracts signed are subject to British laws and regulations, which gives investors more security and stability in their business.
The Chinese Five-Year Plan for the island and economic recovery projections
For 2021, its economy is expected to grow significantly and resume the fall that occurred in 2020. To that end, the 14th Chinese Five-Year Plan announced the implementation of measures for its development, such as: rise as an international financial center , expansion of maritime transport, trade and civil aviation. Along with this, the aim is to transform the region into an even larger international technological hub, in addition to elevating its service sector to a level of sophistication and added value.
With this in mind, the island launched a US$15.5 billion plan to stimulate its economy, mitigate the effects of the crisis caused by the pandemic and make investments in strategic sectors. Furthermore, there was also an expansion of green bonds (debt bonds used to finance sustainable investments) together with government bonds, in order to control the country's inflation. Finally, the government plans to carry out a tax reform in order to increase its income in the long term.
As a result, projections for Hong Kong in 2021 are highly positive. According to the IMF - World Economic Outlook Database, estimates are for a 3.7% increase in its GDP compared to a 7.5% drop last year, in addition to an increase in its GDP per capita and its Employability Rate.
The importance of assistance from an international consultancy
In this way, we see how Hong Kong has grown more and more and can benefit investors around the world with its policies. For greater guidance on how and where to invest within the island, an International Consultancy can be the solution, with a Market Analysis that will help to show more deeply the market and political dynamics of Hong Kong, in order to make a right investment. . .
By Enzo Toledo on 03/17/2021