Is it profitable to register a trading company in Hong Kong in 2019?
In the first quarter of 2018, Hong Kong’s economic growth rates were particularly noticeable - more than 4%. Experts predict that in 2019 the economy is expected to slow, but it is expected that sales will remain at the same level.
According to forecasts, sales in Hong Kong during the year will either slightly increase or remain at the current level. At the same time, it is not denied that the policy of protectionism may intensify, which may disrupt the flow of investments.
Benefit from company registration
The growth trend of export performance is continuous. Compared to 2016, in 2017, total exports increased by 8%, domestic exports - by 1.4%, re-exports - by 8.1%.
The main export destinations are the USA, the European Union, Japan, China, Asian countries. The most popular exported goods are electronics, as well as clothing, watches, precious items.
Export forecasts for Hong Kong are positive. Thus, in 2019, exports are expected to grow by 5%, according to surveys of exporters, most of them expect growth in sales or maintain indicators at the same level. Also, more than 50% of respondents suggest that the value of their goods will not decrease.
The highest rates are expected for exporters of electronics - their goods are in considerable demand. The growth of the cyber market - sports and games for modern mobile devices is noticeable; sales of smart watches have increased, which can be combined with the phone.
Possible risks and problems during company registration
The biggest threat to Hong Kong’s exports is protectionism, a policy that seeks to temporarily restrict imported products and support the production of domestic goods. There is a risk that uncertainty will arise with respect to investment flows.
The main obstacle to growth is the China-American conflict. It is likely that the United States of America will increase customs duties on imports of Chinese products. This situation may adversely affect the economy of China.
The advantages of registering a company are that trading is one of the main activities among companies in Hong Kong. This special administrative region has many double tax avoidance agreements, as well as free trade agreements with some countries that offer favorable conditions for business.
Some entrepreneurs choose Hong Kong for doing business due to the fact that the country has a corporate taxation. The income tax rate is quite low - 16.5%, in 2018 a 2-step system was introduced - the first 2 million are taxed at the lowest rate - 8.25%. In addition, if there is no activity in the territory of the administrative district itself, the company can receive a tax-free status.
The registration process in Hong Kong is fast. If you plan to register an organization that does not have legal entities in its structure, it is sufficient to submit a minimum set of documents. Otherwise, all corporate documents per legal entity will be required.
It can be concluded that registration is a promising solution if you plan to work in the direction of trade. Our experts at IT-OFFSHORE will help to collect documents for the opening of the company, provide advice and answer questions regarding the registration of the company.