Invest Hong Kong (InvestHK) announced Wednesday it had helped 232 foreign companies set up or expand operations here in 2005, an increase of 13 percent over 2004 on record.

At a press briefing on InvestHK's year-end results, the department's Director-General Mike Rowse noted that these companies have created more than 2,500 jobs and will add 5,400 jobs in the next two years. They already have invested more than 8. 9 billion HK dollars (1.15 billion US dollars), an increase of 91 percent over the 2004 record, Rowse said.

"The year 2005 was another year of growth for investment promotion in Hong Kong," said Rowse, who attributed the encouraging results to respected international organizations' recognition of Hong Kong's advantages.

The Heritage Foundation and Wall Street Journal have commended Hong Kong, the world's freest economy for the 12th consecutive year.

Hong Kong was also selected as the overall winner of "Asian City of the Future 2005/6" by fDi Magazine among over 60 cities and regions in the Asia Pacific.

According to the World Investment Report 2005 released by the United Nations Conference on Trade and Development, Hong Kong remained the second-largest foreign direct investment recipient in Asia, after the Chinese mainland.

In 2004, foreign direct investment here reached 34 billion US dollars, up 150 percent from 106.3 billion HK dollars (13.6 billion US dollars) in 2003, and ranked 7th on a global scale, the report said.

In the first three quarters of 2005, Hong Kong attracted more than 208.4 billion HK dollars (26.7 billion US dollars) in direct foreign investment, 14.6 billion HK dollars (1.9 billion US dollars) more than in the same period last year.

The number of regional headquarters and regional offices in Hong Kong also reached all-time highs in 2005.

As of June 1, 2005, there were 1,167 companies with regional headquarters and 2,631 companies with regional offices here, according to the government's statistics department.

InvestHK, a department under the Hong Kong Special Administrative Regional (SAR) government to spearhead Hong Kong's efforts to attract in vestment to the city, has also strengthened its marketing efforts targeting Mainland investors.

During the year, the department organized 10 joint investment- promotion activities with mainland provinces and cities including Guangdong Province and its Dongguan, Guangzhou, Shenzhen, Zhuhai and Jiangmen cities, Fujian Province and Shanghai, and completed 38 projects related to Mainland investments in Hong Kong. The influx of projects from the Mainland shows that these companies have regarded Hong Kong as a springboard to expand their development regionally and internationally.

According to Rowse, Hong Kong's fundamental advantages such as the rule of law, free flow of information and low tax regime have contributed to its attractions to overseas investment.

The Closer Economic Partnership Arrangement (CEPA) between Hong Kong and the mainland is another major consideration for foreign investment.

Since its inception in 2004, InvestHK has organized or participated in seminars in North America, Europe and Asia Pacific to promote the benefits of setting up operations in Hong Kong under CEPA to foreign, Mainland and Taiwan investors.

Of the 232 finished projects, 32 cited CEPA as the reason for their investment, while 31 named CEPA as an additional reason for setting up in Hong Kong.

Rowse noted that InvestHK plans to set up two investment promotion units in the new Hong Kong Economic and Trade Offices in Chengdu and Shanghai this year. It will also expand its presence in the Beijing Office and the Guangdong Office.

"The target for this year is in the range of 240 to 250 completed projects," Rowse said.

A survey shows that a number of companies show interest in making investment in Hong Kong. Included is UK home improvement retailer B&Q, which expects to invest 200 million HK dollars (25.8 million US dollars) and create 200 jobs for the opening of its first store in Hong Kong in 2007.

Global restaurant chain KFC made known plans for an additional investment of over 150 million HK dollars (19.4 million US dollars) to be devoted to increasing the number of outlets from 52 to 90 by 2009, employing another 1,500 staff.

"The target is challenging but accessible, and we are reasonably confident of achieving this," Rowse said.

Source: Xinhua