It must carry out an essential activity, the proof of which is, through an analysis of four distinct criteria: the nature and extent of the activities carried out in Hong Kong, the responsibility for hong Kong`s income tax, at least three years of existence and commercial activity (five years in the construction and mechanical engineering sector, but no conditions imposed on real estate agencies). , and the presence of 100% or leased offices, excluding only “mailboxes” from the benefits of the agreement. 14 Six months after the implementation of the agreement, projects are still progressing slowly, although some interest has been shown. Neither the business community nor the authorities have been under any illusions about this. For example, in November 2003, the Hong Kong Trade Development Council, the organization that promotes Hong Kong`s foreign trade and is a strong supporter of the EPA, stated that “the creation of production activities through the EPA is likely to be limited and the impact on job creation or trade flows should be moderate.” HKGCC draws attention to the existence of projects in the fields of textiles (Ralph Lauren), biotechnology (CK Life Sciences), chemicals, Chinese medical devices, perfumes and even the steel industry. The creation of a specific cross-border zone, in which Hong Kong companies could employ Chinese workers on the mainland, would undoubtedly increase the benefits of the EPA in this area. 4 Unilateral concessions accepted by mainland China are of limited practical scope. Tariff reductions affect only a very small part of bilateral trade that has been rapidly reduced in recent years. The preferential measures have enabled Hong Kong service providers to benefit from certain benefits, which in most cases are concrete and time-limited, as they advance in the timetable the liberalization measures required by China`s WTO accession protocol. Such an advantage is even questionable in some sectors, due to the acceleration of China`s openness. The symbolic significance of this agreement is more important. He first stressed the Chinese authorities` commitment to maintaining Hong Kong`s prosperity, although strengthening that commitment may seem to offset a very conservative approach to political reform. In particular, Hong Kong took advantage of the image by reminding all concerned that, on the one hand, Hong Kong`s economy would be one of the main beneficiaries of China`s accession to the WTO and, on the other hand, the “one country, two systems” principle has considerable benefits for the special administrative region.
The region is an important goal for U.S. legal and accounting services. In 2018, the largest bilateral trade surplus in the United States was with Hong Kong at $31.1 billion. 10Plus two-thirds (70%) In addition, these trade flows are linked to outsourcing operations or capital changes in companies that are already largely duty-free. Thus, the overall “static” (i.e. export-based) benefit of tariff reductions appears to be generously estimated by the Hong Kong government at HK750 million ($100 million), or less than 2% of Hong Kong`s total domestic exports to the PRC. In the size of Hong Kong`s economy, this benefit is not significant. “If there`s a new trading system, it changes the calculation for companies,” said Dr. Tim Summers, senior fellow at Chatham House, based in Hong Kong. Trump said he was about to call for an immediate end to privileges, but said the measures would cover the full range of U.S. agreements with Hong Kong, from an extradition treaty to export controls for dual-use technologies and more “with a few exceptions.” 21 It is striking, however, that the benefits of opening up the profession of lawyer and actuaries are reserved for Hong Kong residents, Chinese citizens (a condition necessary for Hong Kong nationality), which excludes residents of foreign origin, who are very numerous in these occupations.