1
External Investment
Commerce and Industry | 111
Hong Kong's attraction as a place to do business is evident from the inflow of foreign direct investment (FDI) and the number of regional headquarters and regional offices in Hong Kong set up by companies outside Hong Kong.
A Census and Statistics Department survey shows that Hong Kong's FDI inflow in 2004 amounted to US$34.0 billion. According to the 'World Investment Report 2005' released by the United Nations Conference on Trade and Development, Hong Kong was the second largest recipient of FDI in Asia in 2004.
Hong Kong had 9 396 enterprise groups1 with inward direct investment at the end of 2004, comprising 195 in the manufacturing sector and 9 201 in the non-manufacturing sectors. The market value of the stock of inward direct investment amounted to $3,521.9 billion. Chart 3 shows the major economic activities of these enterprise groups while Chart 4 shows source countries/territories of the inward direct investment. Regarding employment, 73 per cent of them were enterprise groups employing fewer than 20 persons (Chart 5).
Chart 3: Position of Inward Direct Investment in Hong Kong at Market Value by Major Economic Activity of Hong Kong Enterprise Group at end-2004
Insurance
2.3% ($80.4 billion)
Financial institutions other than banks and deposit-taking companies 4.2% ($148.9 billion)
Banks and deposit-taking companies
13.7% ($481.2 billion)
Wholesale, retail and import/export trades 14.7% ($516.5 billion)
Other activities 8.7% ($307.0 billion)
Investment holding,
real estate and various business services 56.4% ($1,987.8 billion)
An enterprise group may consist of a parent company, its subsidiaries, associates and branches.