Economic Outlook for Hong Kong Entrepreneurs

Published on October 5, 2025 and written by Cyril Jarnias

Hong Kong, a dynamic crossroads between East and West, continues to attract entrepreneurs from around the world despite recent challenges. This vibrant metropolis offers a unique environment where innovation and business opportunities abound. Let’s explore together the economic prospects available to entrepreneurs in this fascinating city-state, where tradition and modernity harmoniously coexist.

A Promising Economic Recovery

After a period of turbulence, Hong Kong’s economy is showing encouraging signs of recovery. In 2024, real GDP showed moderate growth of 2.5%, continuing the momentum from 2023 which recorded a 3.2% increase. This positive trend demonstrates the resilience of Hong Kong’s economy in the face of global challenges.

The fourth quarter of 2024 was particularly dynamic, with real GDP expanding by 2.4% year-over-year. On a seasonally adjusted quarterly basis, the economy returned to growth, showing a 0.8% increase. These figures suggest a promising future for entrepreneurs choosing to establish themselves in Hong Kong.

Exports, a traditional driver of Hong Kong’s economy, experienced a significant rebound. Goods exports increased by 4.7% over the year, while services exports grew by 4.8%. This recovery is largely due to sustained external demand and improved cross-border economic activities, offering new opportunities for internationally-oriented entrepreneurs.

A Proactive Government to Stimulate Entrepreneurship

The Hong Kong government plays a crucial role in creating an environment conducive to entrepreneurship. Aware of the challenges posed by regional competition and geopolitical tensions, the authorities have implemented a series of measures aimed at strengthening Hong Kong’s position as an international business hub.

Government initiatives focus on several strategic areas to support entrepreneurs:

• Tax relief for startups and SMEs
• Support programs for innovation and R&D
• Simplification of administrative procedures for business creation
• Strengthening economic ties with mainland China and ASEAN countries

These measures aim to create a dynamic entrepreneurial ecosystem capable of attracting and retaining talent and investments. The government also strives to diversify the economy by encouraging the development of new sectors, thereby reducing traditional dependence on financial services and real estate.

Monetary policy also plays a key role in supporting the economy. Although Hong Kong maintains its fixed exchange rate system with the US dollar, monetary authorities remain vigilant and ready to adjust their policy based on the evolving global economic situation.

Emerging Sectors: A Wealth of Opportunities

Hong Kong, long considered a leading financial and commercial center, is seeing the emergence of promising new sectors that offer exciting opportunities for visionary entrepreneurs.

Technology and Innovation at the Heart of Growth

Artificial intelligence (AI) is emerging as the vanguard of innovation in Hong Kong. According to a recent survey, 62% of entrepreneurs consider AI as the technology offering the greatest business opportunities for their industry. This trend is particularly marked in the technology and healthcare sectors.

Entrepreneurs in the technology sector see AI as a means to significantly increase productivity. Within five years, more than two-thirds (67%) expect this technology to substantially improve efficiency in businesses within their sector.

Healthcare and Biotechnology in Full Bloom

The healthcare and biotechnology sector is experiencing rapid growth in Hong Kong. The pandemic highlighted the importance of medical innovation, and the city-state is well-positioned to become a regional hub in this field. Entrepreneurs in the sector benefit from a cutting-edge research ecosystem and facilitated access to Asian markets.

Green Finance and Sustainable Technologies

Hong Kong is firmly committed to transitioning toward a greener economy. Opportunities abound in the areas of sustainable finance, renewable energy, and clean technologies. Entrepreneurs positioning themselves in these markets can benefit from government support and growing investor interest in projects with positive environmental impact.

Navigating Between Risks and Opportunities

Entrepreneurship in Hong Kong also means knowing how to balance the inherent risks of any dynamic business environment with the unique opportunities offered by this Asian hub.

Challenges to Overcome

Political instability and regulatory uncertainty rank among entrepreneurs’ primary concerns. According to a recent survey, 53% of entrepreneurs consider these factors as the greatest risks for their sector in the coming 12 months. Geopolitical volatility, particularly tensions between China and the United States, adds a layer of complexity to the business environment.

Regulatory changes also constitute a major challenge. Nearly half (46%) of entrepreneurs worry about evolving sector regulations and compliance requirements. This concern is particularly acute in highly regulated sectors like finance and technology.

Opportunities to Seize

Despite these challenges, Hong Kong offers unique competitive advantages:

• Favorable taxation and a common law-based legal system
• Strategic position as a gateway to the Chinese and Asian markets
• A sophisticated financial ecosystem facilitating access to capital
• A skilled and multilingual workforce

The Greater Bay Area (GBA) initiative represents a major opportunity for entrepreneurs based in Hong Kong. This project aims to integrate Hong Kong, Macao, and nine cities in Guangdong province into a world-class economic and technological hub. Entrepreneurs can leverage this initiative to access an expanded market and complementary resources.

Long-term Outlook: A Promising Horizon

Despite short-term uncertainties, the long-term prospects for Hong Kong remain broadly positive. Economic analysts forecast sustained, though moderate, growth for the coming years.

Stable but Moderate Growth

For 2025, growth forecasts hover around 2.7%, according to IMF estimates. This projection, though slightly revised downward from previous forecasts, demonstrates confidence in Hong Kong’s ability to maintain a positive growth trajectory.

In the medium term, growth is expected to stabilize around 2.5% per year. This moderation is partly explained by structural factors such as population aging and slowing capital accumulation. Nevertheless, this growth remains solid in the context of developed economies.

Drivers of Future Growth

Several factors should support Hong Kong’s long-term growth:

• Increasing integration with the Chinese economy, particularly through the Greater Bay Area initiative
• Continuous development of the service sector, especially in finance and technology
• Investments in innovation and R&D, supported by proactive government policies
• Strengthening Hong Kong’s role as a hub for international investments in Asia

Challenges to Overcome

To fully realize its potential, Hong Kong will need to address several long-term challenges:

Regional competition is intensifying, with cities like Singapore and Shanghai seeking to attract talent and investments. Hong Kong will need to continuously innovate and improve its business environment to maintain its competitive advantage.

The issue of affordable housing remains a major challenge. High real estate prices can hinder the attraction and retention of talent, a crucial element for entrepreneurship and innovation.

Finally, Hong Kong’s ability to navigate a complex geopolitical context will be decisive. Maintaining its status as an international financial center while further integrating with the Chinese economy will require a delicate balance.

Conclusion: Hong Kong, A Land of Opportunities for Bold Entrepreneurs

Hong Kong continues to offer a dynamic environment conducive to entrepreneurship, despite the challenges it faces. The city-state benefits from a resilient economy, a proactive government, and promising emerging sectors that open new perspectives for visionary entrepreneurs.

Opportunities are numerous, whether in artificial intelligence, biotechnology, green finance, or within the ambitious Greater Bay Area initiative. Hong Kong’s strategic position, favorable tax system, and sophisticated financial ecosystem remain major assets for entrepreneurs looking to expand in Asia.

Certainly, challenges abound, from political instability to regulatory changes and increasing regional competition. However, for entrepreneurs capable of navigating this complex environment and seizing the opportunities that arise, Hong Kong offers considerable potential for growth and success.

In the long term, Hong Kong’s economic prospects remain encouraging, with stable growth expected and continuous investments in innovation and future sectors. For entrepreneurs ready to meet challenges and embrace opportunities, Hong Kong remains a prime destination to launch and develop a business on an international scale.