Strong economic ties and growing corporate confidence continue to position Hong Kong as an important partner for Japanese business in Asia. Gillian Lam, principal representative of the Hong Kong Economic and Trade Office in Tokyo, shares how the city’s legal framework, financial connectivity and access to Greater China are supporting Japanese companies, while new areas of cooperation take shape in innovation, ESG, wealth management and cross-border investment.

Bridges: How would you characterize the current state of Hong Kong–Japan relations, and what factors are driving the strength and resilience of this partnership in today’s evolving regional and global landscape?

Lam: The economic and business partnership between Hong Kong and Japan has evolved far beyond a standard trading relationship; it is now a highly complementary, strategic economic lifeline in East Asia, stronger and more vital than ever before. For Japanese companies, Hong Kong serves as a premier strategic stronghold in Asia, fully leveraging the unique advantages of the “One Country, Two Systems” framework.

This deep integration is powerfully backed by robust, resurgent economic and human ties. In 2025, Japan was Hong Kong’s sixth-largest merchandise trading partner, while Hong Kong was Japan’s ninth-largest trading partner, fifth-largest export market and second-largest overseas market for food, agricultural and fishery products. Bilateral merchandise trade surged by 9.2% year on year to $43.1 billion.

Structurally, Hong Kong acts as a critical regional supply chain conduit, with 10.4% ($34.1 billion) of the total merchandise trade between the Chinese mainland and Japan routed through the city in 2025.

This economic synergy is mirrored by flourishing societal bonds: Visitor arrivals from Japan witnessed a remarkable 32.4% year-on-year jump to 741,900 in 2025, seamlessly supported by an extensive aviation network operating more than 500 combined weekly passenger flights as of May 2026. In an era of global economic uncertainties, this enduring trust and complementary synergy remain a powerful engine driving sustainable growth across the entire Asia-Pacific region.

How does Hong Kong continue to serve as a stable and effective platform for Japanese companies looking to access opportunities across Greater China and the wider Asia-Pacific region?

Amid structural shifts in the global economy, Hong Kong continues to offer Japanese companies an exceptionally stable, legally insulated, and highly predictable platform for expansion, anchored by three unwavering pillars:

• Institutional Safeguards Under “One Country, Two Systems”: Hong Kong’s distinct judicial independence, rule of law, common law system, free flow of capital and low tax regime, with corporate tax capped at 16.5%, remain fully intact. The World Investment Report 2025 by the United Nations Conference on Trade and Development showed that Hong Kong’s foreign direct investment inflows rose to third place globally in 2024.

Ranked again as the world’s freest economy by the Fraser Institute in 2025, Hong Kong is one of the most liberal and easiest places to do business in the world. Long-term business predictability is further anchored by foundational bilateral agreements, including the Investment Promotion and Protection Agreement and the Comprehensive Avoidance of Double Taxation Agreement.

• The Ultimate Gateway to the GBA: As the core international city of the Guangdong-Hong Kong-Macao Greater Bay Area, a massive market of more than 86 million people, Hong Kong seamlessly bridges the Chinese mainland with global networks.

Japanese corporate trust in this environment is clear: Japan remains the second-largest place of origin among companies in Hong Kong with parent companies located outside the city, with the total number of Japanese enterprises growing to about 1,510 in 2025, up from 1,410 the previous year.

• Resilient Growth: The World Competitiveness Yearbook 2025 by the International Institute for Management Development indicated that Hong Kong’s global competitiveness rose two places year on year to third globally and topped the rankings in “business legislation” and “tax policy.”

According to the latest report published by the World Trade Organization, Hong Kong ranked as the world’s fifth-largest trading entity in merchandise trade in 2025. Total merchandise trade amounted to $1.585 trillion, accounting for 3% of the world’s total.

With the number of nonlocal companies exceeding 11,000 and startups surpassing 5,200, Hong Kong’s corporate clustering has reached record highs. According to the Global Wealth Report 2026, Hong Kong’s cross-boundary wealth under management grew by 10.7% year on year to approximately $23 trillion in 2025, enabling Hong Kong to become the world’s largest cross-boundary wealth management center.

• Economic Integration: Furthermore, as a pioneer in free trade and a staunch advocate of a rules-based multilateral trading system, Hong Kong has actively promoted global and regional economic integration throughout its history.

We have played an active role as an independent member of the World Trade Organization and Asia-Pacific Economic Cooperation. We are fully ready and eager to accede to the Regional Comprehensive Economic Partnership, with a view to contributing to greater integration in the Asia-Pacific region through the world’s largest free trade agreement.

Which areas of cooperation between Hong Kong and Japan do you see gaining the most momentum, particularly in finance, innovation, regional headquarters operations, ESG and cross-border investment?

Driven by proactive Hong Kong SAR Government initiatives, such as the “Finance+” and “AI+” strategies, collaboration is experiencing explosive forward momentum, concentrated in high-value innovation and corporate command operations:

• Expansion of Regional Command Centers: Rather than utilizing Hong Kong purely for local distribution, Japanese corporations are expanding their strategic oversight. Out of the Japanese firms surveyed in 2025, Regional Headquarters (RHQs) climbed to about 220, complemented by 420 regional offices and 900 local offices.

• Finance, Family Offices & RMB Connectivity: Driven by the “New Capital Investment Entrant Scheme,” or New CIES, Hong Kong now hosts more than 3,300 single-family offices. It remains Asia’s premier financial hub, with deep institutional roots that include 10 authorized Japanese institutions, eight Japanese-incorporated banks and 11 participating banks on Hong Kong’s RMB clearing platform as of March 2026, placing them at the center of cross-border currency clearing.

• Innovation, ESG & Capital Markets: The development of the Northern Metropolis is evolving into world-class R&D clusters for AI and life sciences. This tech ecosystem connects seamlessly with Asia’s green finance capital through innovative initiatives such as the “Green Technology Project Accelerator,” which the government is actively exploring with multilateral financial institutions.

Supported by a robust capital market ecosystem, including 10 Japanese corporations listed on the HKEX and 32 licensed corporations as of April 2026, Hong Kong provides an immediate springboard for fundraising, cross-border mergers and pioneering ESG ventures.

What message would you like to share with Japanese companies and investors about Hong Kong’s long-term value as a business, financial and regional hub?

In a global economy defined by macroeconomic fragmentation, Hong Kong stands as your most reliable, high-yield, and capital-fluid anchor for long-term growth.

Hong Kong’s long-term value lies in its irreplaceable dual advantage: a direct, friction-free gateway to the Chinese mainland paired with robust international market structures, including global legal standards and strong direct investment ties. As global businesses actively seek to diversify risk, Hong Kong’s institutional certainty shines brighter than ever.

In addition, the government will continue to step up its efforts to attract foreign investment. We will formulate preferential policy packages covering tax incentives, land premiums and other measures to attract high-value industries and enterprises from around the world, including Japanese companies. We will also make the best use of the Northern Metropolis, a massive 30,000-hectare strategic development in Hong Kong, to drive industrial development and propel economic growth.

Currently, Hong Kong is moving forward with its strategic five-year plan, tightly integrated with China’s macroeconomic planning, to solidify its position as an international hub for finance, trade and innovation. Hong Kong in this new era is not merely a doorway to the Chinese mainland but an essential, future-proof global partner for Japanese companies aiming to pioneer innovation, capture immense regional opportunities and create unmatched enterprise value for decades to come.