Hong Kong, a bastion of free-market policies
and low corporate taxes as well as the gateway to the world’s most populous
nation, is the best place to do business, according to data compiled by
Bloomberg.
The
city of about 7 million people secured top position in a new index based on six
criteria including the degree of economic integration and labor costs. The
Netherlands, the United States, Britain and Australia occupied the next four
leading slots.
The
ranking marks a victory for Hong Kong 15 years after the city’s return to
Chinese sovereignty stoked concern that its role as an international financial
hub would slide. General Electric has established operations there, Gap is
among the retailers drawn by the 28 million Chinese tourists who pass through
it and HSBC Holdings is one of the financial titans listed on its stock
exchange.
“Hong
Kong is a gateway to China, it has competitive tax rates and that makes it one
of the natural choices for companies to set up Asian headquarters,” said Tomo
Kinoshita, deputy head of Asia economics research at Nomura Holdings.
“It
makes sense for companies that want to be close to China as well as the rest of
Asia to use Hong Kong as their base.”
Bloomberg
Rankings measured 160 markets on a scale of zero to 100 percent based on six
factors. These are the costs of setting up business, hiring and moving goods;
the degree of economic integration; less tangible costs such as inflation and
corruption; and the readiness of the local consumer base, a category that
includes the size of the middle class, household consumption and gross domestic
product per person.
Hong
Kong scored 49 percent, eclipsing the Netherlands’ 48.3 percent and the United
States’ 46.9 percent.
The
Netherlands ran second, reflecting the appeal of an economy with five major
ports and easy access to mainland Europe. Companies based there include Royal
Philips Electronics, the largest light-bulb maker, and ASML, which has an 80
percent market share in the semiconductor equipment market.
The
United States, the world’s largest economy, came third. President Barack Obama
released a business-tax overhaul proposal on Feb. 22 that would reduce the
corporate rate to 28 percent and e liminate tax breaks.
The
World Bank ranks Singapore and Hong Kong top in its gauge focused on the ease
of doing business. The Washington-based Heritage Foundation has named Hong Kong
the world’s freest economy for 18 successive years.
Bloomberg
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