Is Taiwan the answer for firms leaving Hong Kong? It’s complicated

As Beijing tightens its grip on the city, Taipei says it will help Hongkongers who move over – though there are few details for foreign companies

The island has a similar culture to the city and cheaper labour, but barriers include scarcity of finance-sector talent and a lack of clarity over incentives

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Taiwanese lawmakers are reportedly asking the government to do more to entice firms that have their Asia-Pacific headquarters in Hong Kong. Photo: Shutterstock

Published: 8:00am, 27 Jun 2020Updated: 4:16pm, 27 Jun 2020

After 20 years working in Hong Kong, for multinationals as well as her own firm, Yee Ming Tan moved to Taiwan a decade ago for her partner. For global firms on the lookout for a regional office, Tan said, the cost of living there is lower, the quality of life higher and the cities safer. But Hong Kong makes it easier to do business, she says, requiring less research to set up a business and less work to follow all the rules.

“The runaround with the different government departments is pretty difficult. Of course, if you’re resourceful you would hire a lawyer, but normally it is quite a challenge,” said Tan, 53, the Malaysian-born operator of an executive coaching firm.

Taiwan has said it will help Hongkongers seeking to move over in the wake of Beijing’s tightening grip over the city, with a national security law set to be passed as early as this week. A government office due to open next month in Taipei will offer individual Hongkongers humanitarian assistance, including finding jobs or setting up businesses.

But Taiwan has not released too many details about whether it would offer special incentives for businesses considering leaving Hong Kong, especially foreign firms mulling over an exit strategy.

The government’s InvesTaiwan office leads foreign investors to some of the major incentives being offered. It lists 12 sectors, including green energy and biomedicine, where Taiwan particularly welcomes investment. There are tax breaks for companies that set up in special industrial zones around the island.

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