ENG-2018 — Page 120

Chapter 5

Commerce and Industry

Hong Kong's low tax rates, first-class infrastructure, effective legal system and free flow of capital and information all contribute to an environment in which business can flourish. The city

is an important gateway to the Mainland of China and one of the world's most dynamic economies.

Hong Kong is a leading international trading and services centre as well as an important command and control centre for manufacturing activities in the region. It is recognised as one of the freest economies in the world, a model for international trade and the most strategic gateway to the vast Mainland market. The government is firmly committed to free trade and sees its task as facilitating commerce and industry within the framework of a free market. As a separate customs territory of China, the Hong Kong Special Administrative Region (HKSAR) does not impose any tariffs and works at enhancing customs clearance efficiency while maintaining effective control. Hong Kong also adopts an open and liberal investment policy and proactively encourages inward investment.

Merchandise Trade Performance

Hong Kong's external trade grew notably in 2018. Total merchandise trade increased 7.9 per cent to $8,879.5 billion compared with 2017. Total exports increased 7.3 per cent to $4,158.1 billion, while imports increased 8.4 per cent to $4,721.4 billion. The territory's biggest trading partner was the Mainland, followed by the United States and Taiwan. A summary of external merchandise trade statistics is in table 13 of Appendix 6. In 2018, Hong Kong was the world's seventh largest trading entity in terms of value of merchandise trade.

Total Exports

In 2018, electrical machinery, apparatus and appliances and electrical parts thereof worth $1,585.6 billion were the principal commodities exported, followed by telecommunications and sound recording and reproducing apparatus and equipment ($777.3 billion) and office machines and automatic data processing machines ($448.3 billion). The Mainland, the US and India were the main destinations, accounting for 55 per cent, 8.6 per cent and 3.2 per cent respectively of the total value of total exports.

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