HSBC chairman David Eldon says Hong Kong, which was ranked the freest economy in the world for the 11th consecutive year, is constantly changing and constantly enhancing its business environment

Much of Hong Kong's success and its attraction for many multinational companies is due to the city's multiple personalities, according to chairman of the Hongkong and Shanghai Banking Corporation Limited (HSBC) David Eldon.

"To numerous companies from China, Hong Kong will always be, first and foremost, a place to raise capital," Mr Eldon said. "This is not surprising given the Hong Kong stock market ranks amongst the tenth largest in the world.

"To many other mainland firms, Hong Kong is more - much more - than just a prime funding raising centre. It is also a source of talented managers with international experience. It's a place where Chinese companies can access market intelligence and access other markets: a window to the world."

Mr Eldon was speaking to a Canadian trade delegation in Hong Kong on 24 January.

Regional hub second to none

He added that for multinational companies, Hong Kong is the ideal base for their regional headquarters and offices but said the best description of Hong Kong was summed up by a Canadian newspaper columnist.  He described the city as "a congested, crazy, wall-to-wall skyscraper piece of capitalistic ingenuity" that is "with neon lights ablaze playing midwife to an economy of more than one billion people".

Mr Eldon said in reality there are many things which make Hong Kong special and why the city continues to be an ideal business platform. "The rule of law is not the only thing that makes Hong Kong special. We also have a stable currency, robust banking system and a low-cost, highly predictable tax system."

He said there are many misconceptions about Hong Kong and there are some who think the city is about to be surpassed by Shanghai as China's financial centre.

"The reality is that Shanghai is indeed making enormous strides. However, it still has considerable ground to make up to match Hong Kong. This is in terms of the underlying legal system and the attitudes towards corporate governance, and in terms of the free flow of information that is so vital to financial decision-making and the confidence of international markets. And, of course, in terms of having a convertible currency.

"In the meantime, Hong Kong can be expected to continue to enhance its capabilities and its infrastructure," added Mr Eldon.

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