As people reconnect and get back to normal, there seems to be a real buzz growing in Hong Kong. This was very evident at our very successful Business Summit last month. However, as the Chief Executive mentioned in his keynote luncheon address, many misperceptions about Hong Kong remain in the international business world. It is essential to let the world know that Hong Kong is one of the best business and financial hubs in the world.
There is no denying that the Covid challenges severely impacted businesses. Through the Chamber’s relentless lobbying efforts, we managed to help thousands of companies and convinced the Government to provide financial support, including employment subsidies and, ultimately, to axe all of the social distancing restrictions.
The Chamber also successfully lobbied the Government to relieve SMEs’ hardships through schemes like rebates on profits tax and rates, as well as extending applications and increasing the amount for the SME Financing Guarantee Scheme. The Government also adopted our suggestion to give out consumption vouchers to stimulate the economy.
The city was also hit by an exodus of businesses and talent. The loss of young professionals created a serious skills shortage and pushed up wages. Inbound tourism was badly hit and arrivals remain low, especially those from the Mainland.
But there were positives, too, with some recovery in the second half of the year after restrictions were removed. The Government is addressing skills shortages with the launch of the Hong Kong Top Talent Pass Scheme, which received over 10,000 applications seven weeks after its launch. Also encouraging was the message Hong Kong sent to the world last year with the Global Financial Leaders’ Investment Summit, Hong Kong FinTech Week, and the Hong Kong Sevens – we are open for business and tourists, and the future looks promising.
Throughout 2022, we worked very hard to maintain our full range of services and events for our members. While most talks were held online, we were able to hold some hybrid events as restrictions were eased. We also organized a “Meet the New Chairman” networking event, and a highly praised Gala Dinner to mark the Chamber’s 160+1 anniversary, which was an evening to remember.
With the closed border restricting visits, we conducted regular virtual talks throughout the year on policy changes within the GBA, and signed an MOU online with the Shenzhen Futian District. When border restrictions were lifted at the end of the year, we received the first visiting Mainland delegations in three years from Nansha, Sanya and Haikou. We also sent a delegation to the GBA led by the China Committee and the GBA Working Group, and also joined high-level trips to the Middle East and Thailand.
We met with many Consuls General in Hong Kong and kept up a healthy exchange of views with countries around the world. Zoom seminars connected us with countries and regions from Argentina to Italy, Tasmania to Nigeria. We held a high-level business seminar with senior Indonesian officials, and signed MOUs with Saudi Arabia, Italy and Peru to explore business opportunities.
We also organized joint happy hours with the Chile, Mexican and Spanish chambers of commerce and the European Chamber of Commerce, a networking luncheon with the Korean and Chinese chambers of commerce, and a cocktail gathering with all of the European CGs.
While I have been active in the Chamber and General Committee for years, being Chairman has been a challenging but rewarding chapter. As the Voice of Business in Hong Kong, the Chamber successfully secured the Government’s support to ensure the survival of the city’s businesses. Our efforts were reflected in our membership retention rate, which remained stable year-on-year. This would not have been possible without the support we receive from all members.
Going forward, we must all work harder to reconnect with the world now that Hong Kong is on the road to recovery. I would like to hear your views on how your Chamber can further support you, your business and Hong Kong’s growth as we move into a new, post-Covid environment.
Betty Yuen, Chairman, HKGCC
Striving Tirelessly to Support the Business Community
It goes without saying that 2022 brought the world a lot of uncertainty and disruption. Despite the social-distancing restrictions, the Chamber held over 350 events, as well as in-person meetings with Consuls General in Hong Kong and government officials.
We also continued to lobby the Government through 18 submissions and proposals, and also spoke with the media to explain companies’ plight.
We organized forums and worked with various committees to deliver a substantial Policy Address Submission with recommendations on relaunching Hong Kong, and addressing the housing shortage, among others. For our Budget submission, we proposed that the Government continue to help struggling businesses, and target issues to strengthen the economy, like e-HKD, family office tax concessions, and also the urgent need to stop the outflow of talent. We welcomed the short-term relief measures in the Financial Secretary’s Budget, which included many of our proposals.
To address the growing interest in the Greater Bay Area by members and the business community, we launched a service centre in January 2022 to answer members’ questions about doing business in the GBA. During the year, the group also held many useful seminars, including on how to attract talent to the GBA. We also conducted several member surveys, allowing us to provide valuable updates to the Government on the business environment.
While many get-togethers were postponed in the first few months of 2022 due to social distancing curbs, we organized a digital “New Member e-Networking Session” to introduce new members to our services. Later, as Covid measures were relaxed, we held the HKGCC 160+1 Anniversary Gala Dinner in September, at which the Chief Executive, Financial Secretary and several Secretaries were among the 120 guests who enjoyed the fantastic evening.
Another big event was our 160th Anniversary Photography Competition, which received more than 1,300 entries on the theme “The World’s Greatest Business City.” We also cheered the return of Happy Hours, and hosted signature events like the Joint Business Community Luncheon with the Chief Executive, as well as our Christmas Cocktail Reception at The Hong Kong Club.
The Good Citizen Awards Presentation Ceremony was held in August, where 40 citizens were awarded for helping the Police Force maintain law and order. We also continued with our Business School Partnership Programme, as well as our Business Case Competition, which attracted more than 450 students from various universities in Hong Kong. And we launched the Pitch Perfect Programme – now an annual event – to help university students develop their careers.
In August, the Women Executives Club gave out packages to underprivileged families through the Society for Community Organization. Thanks to our members, close to $650,000 was received in donations. The Young Executives Club participated in a BreadRun to tackle food waste and hunger in the city, and a Lifewire Run to help children with rare diseases.
The Chamber was also severely impacted by constrained business operations. Demand for business services, training programmes and venue rental fell last year. The restrictions and border closures resulted in a sharp decline in demand, and reduced the Chamber’s income. We have worked hard to cut costs to help narrow the deficit without resorting to staff retrenchment.
Despite the hurdles, we continued to provide a full range of services, and I believe the results are there for all to see, especially with the good membership renewal rate.
As normalcy returns in 2023 and the economy begins to recover, normal operations are in full swing. We look forward to continuing to serve members and to lend our unflagging support to the business community.
George Leung, CEO, HKGCC
Serving the Needs of Members
Over the past three years, quarantine requirements in Hong Kong, the Mainland and around the world made international travel difficult – if not impossible. Hong Kong experienced severe hardships, and our people, society and economy inevitably suffered. The business community was not immune either.
I repeatedly urged the SAR Government to formulate a roadmap for reopening the border. I also put forward various proposals, such as cutting the hotel quarantine period for incoming visitors, allowing home quarantine for returning residents, and removing the pre-boarding PCR test requirement for visitors.
Besides staying connected with members to understand the difficulties of various sectors, I proposed to the Government various measures to help tide businesses over, such as extending the Preapproved Principal Payment Holiday Scheme and the launch of the Employment Support Scheme.
These and other recommendations were included in the 2023 Budget. For instance, the application period of all guarantee products under the SME Financing Guarantee Scheme was extended to March 2024, and a new round of electronic consumption vouchers were handed out to the public.
Since the new Administration assumed office in July, Chief Executive John Lee has led delegations to Thailand, the Middle East and the Mainland. By leveraging our advantage as a bridge between the Mainland and the world, businesses in these countries can gain deeper insights into the GBA and the Mainland. Hong Kong businesses are also keen to explore investment opportunities in these emerging markets.
I have also been paying close attention to the Government’s support measures to help SMEs and start-ups facing challenges so they can capture opportunities in the post-pandemic world. HK$550 million will be allocated to the Hong Kong Trade Development Council over the next five years, helping the Council host the annual Belt and Road Summit, organize business delegations to other Belt and Road economies, establish GBA service centres for Hong Kong enterprises, and help SMEs take part in overseas exhibitions and events.
I also encouraged the Government to develop family office business to attract capital. Recently, the Government issued a statement on Developing Family Office Businesses in Hong Kong, which set out eight policy measures. Among these is offering profits tax concession to family-owned investment holding vehicles (FIHVs) managed by single family offices in Hong Kong. The bill was passed in the Legislative Council, where I am honoured to serve as the Chairman of the Bill Committee. The proposal will help attract more capital and talent to Hong Kong.
Building on the Central Government’s commitment to “One Country Two Systems,” Hong Kong enjoys the unique advantage of leveraging on the Mainland while engaging with the world. The SAR Government and business community can join hands and tell good stories to further boost our status as an international business and trading hub in the post-pandemic world.
Jeffrey Lam, HKGCC LegCo Representative
Helping Members Understand Developments in Europe
2022 started under a cloud of pessimism for Europe, as coronavirus restrictions continued to drag down the economy. Conflict, food shortages, rising inflation and geopolitics further added to the gloom. Thankfully, many of the challenges were quickly overcome as European countries lifted Covid restrictions.
Despite the social distancing restrictions, the Europe Committee worked tirelessly to help members understand these developments, and had a busy year organizing talks with business executives, economists, lawyers, researchers as well as Consuls General in Hong Kong.
We also hosted a webinar with the renowned French author David Baverez, who gave a thought-provoking analysis of Europe-China relations. We also had an excellent panel of thought leaders discussing the consequences of the Ukraine crisis and the possible impact on businesses, as well as the repercussions to the multilateral trade system.
On a brighter note, we signed an MOU with Italy’s Cassa Depositi e Prestiti, which has developed an online business matching platform to help connect Italian buyers and sellers with Hong Kong companies. This was followed by another webinar focused on the food and beverage sector, and we arranged business matching sessions to help link members and Italian companies.
Walter van Hattum from the European Union Office in Hong Kong gave members an update on Europe’s post-pandemic economic recovery. We organized talks on France’s economic reforms, aimed at helping the country attract more investment and increase its importance as a key financial hub. We also held talks on business opportunities in the Czech Republic, Hungary and Poland, and had a lively discussion on NFTs, with two art law experts speaking from Milan.
To help members reconnect as social gatherings were again permitted, we organized happy hours with the European Chamber of Commerce in Hong Kong and the Spanish Chamber of Commerce, and I am very pleased to report that our Cocktail Reception with European Consuls General in Hong Kong made a comeback in May at The Hong Kong Club.
Wilhelm Brauner, Vice Chairman, Europe Committee
Raising Awareness of Land and Housing Issues
Housing continues to dominate the city’s policy agenda and the Real Estate & Infrastructure Committee attaches great importance to tackling this longstanding issue. To develop workable solutions for the incoming new Administration, last year the Committee established the ad hoc Land & Housing Supply Working Group. It comprises not only committee members but also practitioners, experts and researchers, who assist the Chamber in formulating recommendations on recurring issues of land and housing.
Our proposed solutions, which focused largely on “quick-wins” that can be implemented expeditiously to increase supply, restore affordability and shorten public housing waiting time, were incorporated into the Chamber’s Policy Submission to the Government. A number of our recommendations were adopted in the Chief Executive’s Policy Address.
As part of its advocacy work, the committee regularly engages with the Government to facilitate exchanges and provide timely updates on policy developments. During the past year we hosted the Secretary for Development Bernadette Linn and her team to brief members on the Government’s preliminary proposals for the reclamation and development of Kau Yi Chau Artificial Islands. Officials from the Development Bureau were also invited to share on the legislative proposals on streamlining statutory procedures to expedite land and housing supply. We have also invited industry experts and practitioners to discuss such key topics as 5G application and data centre development.
To help members stay abreast of the latest market developments, the committee organized a wide range of seminars on evolving market trends and emerging business opportunities, including the use of proptech in urban regeneration and incorporation of ESG in real estate.
Looking ahead, the committee will continue to advocate for and promote awareness of land and housing issues. We will continue to make the utmost of every opportunity to work with like-minded stakeholders on issues of common interest.
Eric Ma, Chairman, Real Estate & Infrastructure Committee
Keeping Abreast of the Tax Landscape
Hong Kong recently took a strategic step forward by positioning itself as a leading player in the wealth management sector, through the introduction of the new Family Office regime. This initiative, which offers a concessionary tax rate of 0% to qualifying Family Offices, underscores Hong Kong’s commitment to diversifying its financial services industry and enhancing its competitiveness in the region.
In response to this new regime, our committee submitted recommendations to the Government to expand the definition of “family office,” clarify the eligibility criteria for tax concessions, and streamline the application process to facilitate the establishment of family offices in Hong Kong. This new regime presents a significant opportunity for Hong Kong to become a hub for family office activities in the region.
Our committee also focused on the refined foreign-sourced income exemption regime, or the “FSIE” regime, which came into effect on 1 January 2023. This was in response to concerns raised by the European Union about Hong Kong’s treatment of offshore passive income. We submitted recommendations to enhance the clarity of the regime, particularly regarding the interpretation and application of covered income and economic substance requirement, and the eligibility criteria for the proposed participation exemption for offshore dividends and disposal gains. To that end, we organized seminars on navigating the challenges arising from such reforms. We also closely monitored the developments of the BEPS 2.0 framework and the impact of Global Minimum Taxation rules on all in-scope enterprises in Hong Kong.
We also organized seminars on other timely topics, such as taxation of crypto assets and mitigating tax risks through property transfer arrangements. These seminars provided valuable insights on the latest trends and developments from a tax and business standpoint.
The committee led the preparation for the Chamber’s annual Budget Submission, which included recommendations on measures to support businesses in the face of the pandemic. We contributed to the monthly Joint Liaison Committee on Taxation meetings, a platform for the Chamber and others to engage in constructive dialogues with the government on Hong Kong tax policies and issues. Going forward, we will continue to keep our members well prepared in the fast-changing tax landscape.
Wayne Lau, Chairman, Taxation Committee
Betty Yuen Re-elected HKGCC Chairman
Betty Yuen, Group Director, CLP Holdings Ltd, has been re-elected Chairman of the Hong Kong General Chamber of Commerce (HKGCC) for the coming year.
The election was held at the inaugural meeting of the new General Committee immediately after the HKGCC’s Annual General Meeting on the evening of 19 May. Agnes Chan, Senior Advisor, Chairman Office, Greater China, Ernst & Young, was re-elected as Deputy Chairman, while Guy Bradley, Chairman, John Swire & Sons (HK) Ltd; Victor Li, Chairman and Group Co-Managing Director, CK Hutchison Holdings Ltd; and Douglas Woo, Chairman & Managing Director, Wheelock and Co Ltd; were re-elected as Vice Chairmen.
At the AGM, members elected a total of six members to fill the seats on the General Committee – the governing body of the Chamber – who were required to step down this year. Five of them were re-elected, respectively: Guy Bradley, Chairman, John Swire & Sons (HK) Ltd; Victor Li, Chairman and Group Co-Managing Director, CK Hutchison Holdings Ltd; David Liao, Co-Chief Executive, The Hongkong & Shanghai Banking Corp Ltd; Edmond Yue, Director, Innopipe Engineering Co Ltd; Betty Yuen, Group Director, CLP Holdings Ltd.
Pansy Ho, Group Executive Chairman and Managing Director, Shun Tak Holdings Ltd, was newly elected as a General Committee member.
HKGCC General Committee
Chairman: Betty Yuen
Deputy Chairman: Agnes Chan
Vice Chairmen: Guy Bradley, Victor Li, Douglas Woo
LegCo Representative: Jeffrey K F Lam
General Committee Members:
Jennifer Chan, Oscar Chow, Eric Fok, Allen Fung, Aron H Harilela, Pansy Ho, Benjamin Hung, Jacob Kam, Peter K N Lam, David Liao, Eric Ma, Nikki Ng, Roy Ng, YK Pang, Neville S Shroff, Sun Yu, Emil Yu, Yu Pang Chun, Edmond Yue