Hong Kong Commerce and Economic Council: Attracting Mainland enterprises to use Hong Kong as a platform for developing overseas business and establishing supply chains

The Zhitong Finance App learned that today, the Secretary for Commerce and Economic Development of Hong Kong, Mr Yau Ying-wah, responded in writing to the Legislative Council's question on investment promotion efforts. On the one hand, the Hong Kong Investment Promotion Department is actively organizing events on the theme of the multinational supply chain through the Investment Promotion Task Force of its Mainland office to actively reach out to more mainland enterprises and carry out investment promotion work to attract these enterprises to use Hong Kong as a platform for them to develop overseas business and establish supply chains. On the other hand, the Hong Kong Trade Development Council provides one-stop professional consulting services for companies established in Hong Kong. This includes helping them establish links with overseas markets and understand overseas market regulations; providing market research covering different emerging markets such as the Middle East, Central Asia, and Latin America.

The global trade landscape and geopolitics are constantly changing. Some supply chains are migrating to the “Global South” and “Belt and Road” countries, and mainland enterprises are also actively “going global”. According to statistics, there are currently more than 50,000 medium-sized manufacturing enterprises in the Pearl River Delta and Yangtze River Delta alone. Many of them are involved in overseas business, and there is a need to “go global” part of the manufacturing process. As they deploy to respond to these changes, Hong Kong's rich international trade experience and world-class services can help them seize business opportunities.

The 2024-2025 Budget announced that the HKSAR Government aims to establish Hong Kong as a multinational supply chain management center. In the 2024 “Policy Address”, the Chief Executive further requested the Investment Promotion Department and the Hong Kong Trade Development Council (TDC) to establish a high-value-added supply chain service mechanism to attract mainland enterprises to Hong Kong to establish international or regional headquarters to manage offshore trade and supply chains, and provide one-stop professional consulting services for enterprises in Hong Kong. In December 2024, the Investment Promotion Department and the Trade Development Council established the above mechanism and are actively collaborating with relevant “Hong Kong Team” organizations, including the Hong Kong Export Credit Insurance Council (Hong Kong Export Credit Insurance Council) and the Hong Kong Productivity Council, to support mainland enterprises in Hong Kong to “go global”.

Although these mainland enterprises will need to respond in terms of deploying their supply chain layout in response to the imposition of tariffs by the US in different regions, Hong Kong can become an international or regional headquarters for these enterprises to manage offshore trade and supply chains, and make good use of Hong Kong as a springboard to develop their multinational business. On the one hand, the Hong Kong Investment Promotion Department is actively organizing events on the theme of the multinational supply chain through the Investment Promotion Task Force of its Mainland office to actively reach out to more mainland enterprises and carry out investment promotion work. As of the end of February 2025, the Investment Promotion Department has organized and co-organized about 20 related investment promotion activities in different cities in mainland China, including Hangzhou, Nanjing, Xiamen, etc. The Investment Promotion Department will seek out mainland enterprises interested in “going global” through various activities and attract these enterprises to use Hong Kong as a platform for them to develop overseas business and establish supply chains.

On the other hand, the Hong Kong Trade Development Council provides one-stop professional consulting services for companies established in Hong Kong. For enterprises with plans to “go global”, the Trade Development Council will provide local support services through its overseas offices, including helping them establish links with overseas markets and understand overseas market regulations; providing market research covering different emerging markets such as the Middle East, Central Asia and Latin America; and providing information on various aspects of environmental, social and corporate governance (ESG), testing and certification, and export credit risk management. Furthermore, in response to Hong Kong businesses' rich knowledge and experience in overseas market compliance, labor security and environmental protection, the Trade Development Council has facilitated cooperation between enterprises and various institutions and industry insiders to provide ESG training for mainland enterprises expanding overseas to help them establish a good reputation and expand their markets.

In addition, the Credit Insurance Administration will provide credit insurance for export services related to the multinational supply chain to provide more comprehensive support for enterprises to “go global”. To help Hong Kong exporters expand into mainland and emerging economy markets, the Credit Insurance Council has also increased the limit of free buyer credit check services from 12 to 20.

In fact, Hong Kong's advantages in helping mainland enterprises to “go global” are very obvious and important. In addition to high-quality talents and networks with rich experience in offshore trade and supply chain management, under “one country, two systems”, Hong Kong not only has the unique advantage of supporting the motherland and connecting the world, but also plays an important role as a “super contact” and a “super value-added person”. It is a two-way springboard for mainland enterprises to “go global” and “bring in” overseas companies. Hong Kong's institutional foundation, including the implementation of common law, an independent judiciary, a good business environment and an efficient and transparent market, a regulatory system in line with international rules, a simple tax system and low tax rates, world-class professional services, and the free flow of goods and factors of production, such as talent, capital and information. Coupled with national key strategies such as the national “14th Five-Year Plan”, the development of the Guangdong-Hong Kong-Macao Greater Bay Area and the “Belt and Road” initiative, it has brought unlimited opportunities to Hong Kong, making Hong Kong the only economy in the world that combines international advantages with China's advantages.

Hong Kong's strengths and experience are also particularly suited to the needs of small and medium-sized enterprises in the Mainland. The demand for high value-added supply chain services by small and medium-sized enterprises in the Mainland is also in line with the Investment Promotion Department's observations. Over the past year, in various investment promotion activities, the department has noticed that after learning about Hong Kong's advantages and professional services, many small and medium-sized enterprises agree that “going global” through Hong Kong is far more effective and convenient than directly “going overseas”, and have expressed interest in using Hong Kong as their headquarters to manage offshore trade and supply chains. The Investment Promotion Department and the Trade Development Council will provide one-stop supply chain consulting services and other related assistance to these enterprises through a high value-added supply chain service mechanism.

To further strengthen cross-agency coordination, with the support of the Financial Secretary of Hong Kong, the Investment Promotion Department established an interdepartmental/agency referral mechanism (referral mechanism) led by the Director of Investment Promotion last year. The department actively monitors and studies the concerns and pain points faced by mainland and overseas companies when settling in Hong Kong, so as to reflect and discuss appropriate solutions with relevant policy bureaus, departments or agencies. Since the establishment of the referral mechanism for more than half a year, it has successfully handled a number of issues to meet the needs of the industry (such as opening bank accounts, applications for migrant workers and work arrangements, applications for the use of vacant land, etc.) to facilitate mainland and overseas enterprises to settle in Hong Kong and expand their business.