Letter to Hon Dan Tehan MP, Minister for Trade, Tourism and Investment
The Hon Dan Tehan MP
Minister for Trade, Tourism and Investment
PO Box 6022
House of Representatives
Canberra ACT 2600
By email: Dan.Tehan.MP@aph.gov.au
On behalf of The Australian Chamber of Commerce in Hong Kong (“AustCham”) I am writing to thank you for the meeting you held with us on 27 August, 2021.
Your comments on the need for a positive and strong business relationship between Australia and China were well received by our members. Your recognition of the role AustCham plays in developing and supporting business-to-business relationships is appreciated. We will continue in our mission to connect, engage and represent Australian business in this region, as well as support Hong Kong companies investing in and doing business in Australia.
Hong Kong remains an important market for many Australian businesses operating throughout Asia. It is the leading financial centre in Asia and a key source of capital, being the second largest IPO market globally in 2020. Hong Kong remains the largest international asset management hub in Asia; largest private wealth and hedge fund centre in Asia, and is second only to China as a centre for private equity.
Our members remain committed to Hong Kong, despite the Australia-China trade tension, economic impacts of the Covid-19 pandemic and local social and political turmoil. Hong Kong is resilient and Australians working overseas are used to operating in challenging environments.
The opening of markets in the Greater Bay Area, and a focus on technology and innovation, provide significant opportunity for future business growth. AustCham is seeking to work with local associations in Hong Kong to expand business to business engagement in the Greater Bay Area. This engagement may include virtual delegations, business introductions and networking events in Hong Kong. In terms of technology and innovation, AustCham can act as a bridge to support Australian technology and innovation companies seeking pathways to the investment and market opportunities in Hong Kong and the Greater Bay Area.
Hong Kong and Australia have a long-standing and unique relationship. Hong Kong is home to over 100,000 Australian nationals and an estimated 70,000 dual nationals. With the largest number of Australian businesses based outside Australia here in Hong Kong, our presence is substantial and well recognized by the Hong Kong Government and other stakeholders. In addition to the Australian presence in Hong Kong, Australia remains an attractive destination for Hong Kong businesses to invest, and for its people to take up education and tourism opportunities.
AustCham applauds the Australian Government’s goal to vaccinate 80% of Australians by year’s end and supports initiatives that open international travel in a safe and beneficial manner. Ongoing border closures have a significant impact on Australia’s attractiveness for business, investment and education. AustCham recommends the Minister proactively encourage the opening-up of travel and quarantine facilities for international businesspeople, investors and students.
We felt encouraged at your comments that international travel to Australia may open by Christmas and are optimistic for successful trials of home quarantine. For Australians in Hong Kong who are caught between the tough entry restrictions in Australia, and the significant quarantine requirement in Hong Kong, we ask that the Minister advocate for a travel corridor from Hong Kong to Australia for vaccinated Australians.
Australia and Hong Kong have had a longstanding trade and investment relationship. Hong Kong is Australia’s seventh largest trading partner and fifth largest source of direct foreign investment. Hong Kong remains the gateway for capital to and from China for many Australian businesses.
Recent changes to Australia’s Foreign Investment Review Framework have created a sentiment of concern among our members about the receptiveness in Australia to investment from Hong Kong. In response, the Greater China Chambers (Beijing, Shanghai, Hong Kong) have convened a working group to provide a forum for communication on Australia’s foreign investment regime with investors, supporting businesses and government representatives. The forum aims to:
- cultivate a deeper understanding of domestic and international considerations for investment
- provide feedback on specific issues that are not well understood
- discuss future draft legislation governing foreign investment into Australia, and
- develop an understanding of the investment appetite for particular industry sectors.
We note that many international investors from Europe, North America and Asia have already made, or wish to make, significant investments in Australia and manage those from Hong Kong. Accordingly, Hong Kong’s unique position as an international gateway and facilitator for capital and investment means that international investors together with Australian or Hong Kong companies are seeking this advice. We hope the initiative from the Greater China Chambers can increase understanding of Australia’s attractiveness as an international investment destination. AustCham stands ready to support the Australian Government and the international business community to promote and encourage inbound investment to Australia.
AustCham recently wrote to the Treasurer about potential impacts of changes to Australian Tax Residency Rules. A copy of our correspondence is included for your reference. Hong Kong could be uniquely affected given the lack of a comprehensive tax treaty between the two jurisdictions. We strongly recommend that Australia begins discussions with counterparts in Hong Kong on a Double Tax Agreement.
Thank you again Minister for your time with AustCham. We view this meeting as a foundation to build on and we look forward to a future opportunity to discuss these issues with you.
Cc: Elizabeth Ward, Australian Consul General to Hong Kong and Macau
Inc: Letter to Australian Treasurer from AustCham Hong Kong, dated 24 August 2021