HK Economy- Highlight
12 Jan 2018
US President Trump signed the biggest overhaul of the US tax system in more than 30 years into law on 22 December 2017. It’s estimated that the newly-enacted Tax Cuts and Jobs Act will give the bulk of US households a tax cut for the next decade and deliver to most US corporations a lower after-tax cost of capital. However, it is being criticised for adding US$1.5tn to the current US national debt of US$20tn in the coming 10-year budget window.
Hong Kong and the Chinese mainland inked two new agreements on 28 June 2017, namely the Investment Agreement and the Economic Technical Cooperation Agreement (Ecotech Agreement) to progressively enrich the CEPA content over the years. The Ecotech Agreement does not cover market access commitments or substantive liberalisation measures, but set forth the direction for closer future co-operation between Hong Kong and the Chinese mainland.
Hong Kong is the third biggest financial centre according to The Global Financial Centres Index 22. Although Shanghai ranks sixth on this list and has no shortage of financing channels, many Shanghai companies carry out project financing through Hong Kong. They hope to make use of the city’s convenient capital movement to develop international business, and access cost-effective resources to optimise their financing structure.