ENG-2020 — Page 119

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Commerce and Industry

Inward Direct Investment

According to the World Investment Report 2020 issued by the United Nations Conference on Trade and Development, Hong Kong was the world's third largest destination for inward direct investment in terms of total stock at the end of 2019. The vast stock of external direct investment in Hong Kong demonstrates its status as an international centre for finance and commerce, and its attractiveness as a base for multinational corporations to manage their investment and business round the world. Hong Kong's foreign direct investment (FDI) inflow in 2019 amounted to $456.7 billion. At the end of 2019, the total stock of inward direct investment' amounted to $16,186.9 billion. Chart 2 shows selected major investor countries and territories of inward direct investment. The British Virgin Islands and the Mainland were the two largest, accounting for 33.9 per cent and 28.1 per cent of the total respectively. Chart 3 shows the major economic activities of Hong Kong enterprise groups2 having received inward direct investment. Those engaged in investment and holding, real estate, and professional and business services took up the largest share, at 65.7 per cent of the total.

The latest survey covering some 9,000 companies in Hong Kong with parent companies located outside Hong Kong found 3,983 of them had regional headquarters or regional offices here in 2020.

Chart 2

Stock of Hong Kong's Inward Direct Investment at Market Value by Selected Major Investor Country/Territory* at end-2019

Other countries/territories

14.4% ($2,100.5 billion)

Bermuda

5.9% ($851.4 billion)

United Kingdom

8.2% ($1,197.8 billion)

Cayman Islands

9.5% ($1,376.8 billion)

British Virgin Islands

33.9% ($4,936.3 billion)

The Mainland of China 28.1% ($4,081.0 billion)

#Selected based on the stock of Hong Kong's inward direct investment

from individual investor countries/territories in recent years.

Note: Individual percentage shares may not add up to 100 due to

rounding.

1 According to international statistical standards, the total stock and flow of inward direct investment presented in this paragraph is compiled based on the asset/liability principle, while detailed inward direct investment figures analysed. by country/territory and by major economic activity of Hong Kong enterprise groups presented in charts 2 and 3 respectively are based on the directional principle. Owing to the adoption of different presentation principles, the total stock of inward direct investment is different from the sum of the detailed inward direct investment figures by country/ territory or by major economic activity of Hong Kong enterprise groups.

2

A Hong Kong enterprise group consists mainly of a Hong Kong parent company and its Hong Kong subsidiaries, associates and branches.

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