Hong Kong hosted 9,960 firms with parent companies located outside of the city this year, a record-high number and a 10 percent increase on the previous year, government data shows.

The number of people employed by such firms reached nearly 500,000, an increase of 5 percent year-on-year, according to the latest annual survey jointly conducted by Invest Hong Kong (InvestHK) and the Census and Statistics Department.

The figures demonstrate that Hong Kong's business environment has fully regained its strong growth momentum following the COVID-19 pandemic, said InvestHK Director-General of Investment Promotion Alpha Lau Hai-suen.

Due to uncertainty in the global economic situation, many companies are taking a cautious approach to expansion, she said, adding that the latest numbers indicate Hong Kong is a pragmatic choice of location as it remains a very good place to do business.

READ MORE: HK crowned world’s freest economy

Analyzed by parent company location, the top five sources of firms from outside Hong Kong are: the Chinese mainland (2,620), Japan (1,430), the United States (1,390), the United Kingdom (720), and Singapore (520).

The top 10 locations, which include traditional markets in the Americas and Europe and the Asian markets, all recorded increases in 2024, according to the government data.

“Facts speak louder than words. Companies expand their business here and use Hong Kong as a springboard to enter into the Chinese mainland, into Asia, or for Chinese companies to go out and expand into the rest of the world,” said Lau.

Notably, the number of regional headquarters in Hong Kong increased to 1,410, representing a 5.5 percent increase.

The figures not only reflect Hong Kong's attractiveness but also indicate that InvestHK’s efforts to draw investment to the city are bearing fruit.

InvestHK is a government department founded in July 2000 to facilitate overseas businesses to set up and expand in the special administrative region.

ALSO READ: HK sees record highs in registry of local, non-local firms in H1

As of November, it had assisted over 500 companies in setting up or expanding their operations in the city in 2024, an increase of more than 50 percent year-on-year.

Companies that have established their headquarters in Hong Kong believe that the city's advantages as a hub for capital, talent and technology are self-evident.

Lucas Kong, general manager of KN Group Hong Kong Treasury Centre, highlighted that the city maintains its status as one of the world's leading financial centers, boasting a mature and open financial market environment.

“As a fintech company leveraging artificial intelligence in the financial sector, establishing our headquarters in Hong Kong significantly facilitates the expansion of our international operations,” he said.

The robust economic incentives provided by the HKSAR government have been instrumental both in attracting businesses and fostering technological innovation, he said.

READ MORE: HK sees over 130,000 newly registered companies in 2023

While the company’s expansion has led to its liquidity structure becoming more decentralized, resulting in increased management costs, establishing a global corporate treasury center in Hong Kong has allowed the business to centralize fund management and allocation, thereby reducing costs and enhancing efficiency, said Kong.

“This move is made possible by Hong Kong's transparent and open business ecosystem, coupled with its favorable tax regime,” he added.

Many family offices are also zeroing in on Hong Kong as the government’s various high-value talent attraction schemes make the city an enticing choice for such operations. One such example is the family office Glory, which engages in insurance and trusts.

ALSO READ: HK's confidence grows with record presence of multinationals, startups

Gao Yang, global CEO of Glory, said while it operates in both Hong Kong and Singapore, many of its clients favor Hong Kong, due to the SAR government's introduction of a range of flexible and practical talent admission policies for Chinese high-net-worth individuals.

These initiatives provide a variety of pathways, enhancing Hong Kong's appeal as a premier financial hub, she added.