Hong Kong, the world’s freest economy, will be host to some 500 delegates attending the Asia-Pacific Economic Cooperation (APEC) Finance Ministers’ meeting (FMM) today (Tuesday).
It will be the forerunner to the 33rd APEC Economic Leaders’ meeting and the APEC CEO Summit, hosted by President Xi Jinping and attended by US President Donald Trump and Russian President Vladimir Putin in Shenzhen in November.
And in between these meetings will be the annual World Bank and International Monetary Fund meetings in Bangkok at the end of the month. A very busy time for the world’s economic powers, many of whom are struggling to make ends meet.
Yesterday, Chief Executive John Lee welcomed APEC delegate and President of the Asian Infrastructure Investment Bank (AIIB) Mrs Zou Jiayi to Hong Kong, noting that AIIB’s continued use of Hong Kong’s strengths as an international finance hub, and its mature and comprehensive bond market to connect with international investors.
The AIIB is expected to open an office in Hong Kong soon, serving both financing and operational functions. This will demonstrate Hong Kong’s role as a gateway connecting the country and the world.
Some 1,000 delegates at the Shenzhen meetings will see first hand how a sparsely populated farmland of five decades ago has been transformed into a thriving city of the future with a population of 18 million.
The series of meetings of the world’s leading economies highlight the 2026 APEC China Year, running under the overall theme "Building an Asia-Pacific Community to Prosper Together".
Finance chiefs and high-ranking senior officials include representatives from key observing bodies, such as the International Monetary Fund, the World Bank, and the Asian Development Bank, who will join representatives of all 21 APEC member economies in the high-level dialogues at the Hong Kong Convention and Exhibition Centre today and for the next two days. China’s finance ministry will chair the meeting in Hong Kong, while the city authorities handle the event’s logistics, such as arranging the venue, transport and accommodation.
Hong Kong has long been recognised as an events capital for hosting major international conferences, and has extensive experience in managing media affairs and promotional activities for such events.
There will also be special tours and cultural events for the visiting spouses. The city will leverage the FMM programme arrangements with incorporate elements of Chinese culture, as well as the unique characteristics of Hong Kong. This will include the venue set-up (including exhibition booths around the conference area) and the design of side events (including welcoming dinner, cultural performances, and site visits) to enable participants to experience and interact with these cultural elements first-hand, thereby effectively telling good stories of Hong Kong.
Hong Kong will surely take advantage of such a captive audience by demonstrating how it became the world’s freest economy announced recently by Canada’s Fraser Institute.
It will also be an opportunity to debunk false statements by some of the attending delegates that Hong Kong is dead. Instead, the delegates will see a vibrant city with a sound five-year plan to ensure continuity of its policies in the years to come.
These policies will include the massive Northern Metropolis project along the Shenzhen boundary. And when they cross the river to attend further APEC meetings they will marvel at the scale of high tech development driving China’s economy.
Artificial intelligence (AI), which is surely to be a key topic among APEC members in this highly charged environment, is key technology for enhancing industrial competitiveness and strengthening economic growth. Making effective use of AI as a valuable tool for innovation requires active coordination and adoption of both the public and private sectors. It is a subject discussed at previous APEC meetings, which found that to enable innovation and adoption, it is important to ensure that regulatory regimes are conducive to AI development and deployment.
Economies have been encouraged to ensure that such regimes are fit-for-purpose and safeguard consumer protection, which is safe, secure, reliable and accessible for all. The sustained development of the AI ecosystem requires the cultivation and strengthening of skilled AI talent.
In this context, the finance ministries can play an important role in supporting the AI ecosystem and creating the appropriate incentives for the market. This may include tax incentives, promoting AI-related industries, partnering with the private sector, or supporting investment in enabling infrastructure and AI talent development.
Hong Kong is known for its openness and minimum regulations for foreign businesses setting up shop here, attributes recorded in the 2026 Fraser Report. It is a role model for others to follow.
U.S. Treasury Secretary Scott Bessent will skip the Hong Kong gathering to focus on the follow up APEC meetings in Shenzhen. Instead, Treasury Undersecretary for International Affairs Erin Browne is to head the U.S. delegation. It is hoped that Browne (in Hong Kong), Bessent and Trump (in Shenzhen) will listen and not preach to their APEC colleagues. For a country, that is forty trillion US dollars in debt and on the verge of bankruptcy, it is in no position to lecture anybody about how to run their economy.
Mark Pinkstone
** 博客文章文責自負,不代表本公司立場 **
Here is proof that Hong Kong has a freer economy than any of its doomsday prophets. In fact, it is the freest economy in the world.
Canada’s Fraser Institute ranks Hong Kong the leader among 165 jurisdiction in the world for having the freest economy at 8.53 points out of 10 despite the brickbats thrown at us by the naysayers. Switzerland knocked out Singapore for second place at 8.45 points, and Singapore third at 8.43 points. Hong Kong’s strongest critics, USA was 5th at 8.21, Australia 8th at 8.06 points and the UK 10th at 7.96 points.
The ratings evaluates countries across dozens of data points that are distilled into five core metrics: size of government, legal system and property rights, sound money (how well citizens protect their wealth from inflation), freedom to trade internationally, and regulations.
Of course, international trade and an absolute absence of capital control are the city’s key strengths, thus highlighting its structural resilience as a leading international financial hub.
The city’s regulatory framework minimises bureaucratic friction for corporate structuring, employment, and licensing, striking a stable balance between investor protection and market flexibility.
A hallmark of Hong Kong's institutional framework is its simple and low tax regime. Corporate tax is capped at an attractive 16.5 per cent, and personal income tax tops out at 15 per cent on the first $5 million and 16 per cent on the remainder. And, the system does not impose capital gains tax, withholding tax on dividends, or value-added taxes (VAT). This fiscal predictability offers an unmatched operating landscape for both multinational corporations and agile start ups.
A cornerstone of Hong Kong's financial ecosystem is the absolute absence of capital controls. Funds can be moved seamlessly into and out of the city. This liquidity is crucial for the foreign exchange, asset management, and equity markets that rely on instantaneous capital reallocation. Backed by the robust linked exchange rate system tying the Hong Kong dollar to the US dollar, the currency remains a stable bedrock for global trade settlement.
Furthermore, the territory remains highly receptive to global human capital. The free flow of information and international talent enables the city to consistently plug into global innovation networks. In the first eight months of 2026 alone, the government investment agency, Invest Hong Kong (InvestHK), successfully assisted 520 mainland and overseas enterprises to set up or scale their operations in the city, underscoring strong commercial confidence.
While the 2026 report reaffirms Hong Kong's top position, it also reflects longer-term challenges. Analysts point out that Hong Kong's total economic freedom score has experienced a slight decline since 2018, primarily due to shifting perceptions of its legal and judicial independence alongside tightening governance controls.
Nevertheless, the data—compiled primarily from trailing comprehensive baselines up to 2024—shows that the underlying commercial mechanics remain exceptionally open compared to global peers. While some argue that evolving national security laws alter the broader political environment, the business landscape operates with distinct legal continuity under the "One Country, Two Systems" framework. The city retains its common law system, distinct from mainland China’s civil law structure, which ensures contract enforcement remains highly efficient and legally predictable for international investors.
Hong Kong's economic model functions uniquely as a hyper-efficient bridge between the mainland and the global market. Through initiatives like the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) development, the city functions as a launch pad for overseas companies targeting the massive mainland consumer base, as well as a capital conduit for Chinese firms expanding internationally.
Amidst an international backdrop of intensifying trade protectionism and fracturing supply chains, Hong Kong’s commitment to multilateral open trade functions as an institutional competitive advantage. Its highly developed logistical infrastructure, elite maritime ports, and world-class international airport seamlessly complement its financial architecture to reinforce this gateway status.
Doomsday prophet Stephen Roach, former chairman of Morgan Stanley Asia and who should know better, has predicted the end of Hong Kong and that it is too dependent on China. As an example, he cites: “Beijing’s hostile takeover following the pro-democracy demonstrations of 2019–20 has transformed Hong Kong into just another big Chinese city. Today, its Mandarin name is Xianggang”. His ignorance shows. Ever since China introduced pinyin as the romanization of its language in the 1950s, Hong Kong has always been known as Xianggang in the official Mandarin language. For international and everyday use, Hong Kong is still Hong Kong. Moreover, Hong Kong was returned to Beijing in 1997, not 2020!
Hong Kong’s top ranking in the 2026 Fraser Institute report underscores the structural durability of its almost laissez-faire economic model. By fiercely preserving its core policies of unrestricted capital movement, low tariffs, a minimal tax burden, and business-friendly regulations, the special administrative region continues to counter macroeconomic headwinds. While navigating a complex geopolitical and legal transition, Hong Kong remains an elite, highly competitive arena for international business, proving that its foundational free-market design is built to endure.
