The United Nations Conference on Trade and Development (UNCTAD) has unveiled its 2025 World Investment Report, revealing Hong Kong's ascent to the third position globally for foreign direct investment (FDI) inflows during 2024. FDI inflows into the territory surged to $126 billion, marking a 2.6% year-on-year increase. Concurrently, Hong Kong's total FDI stock climbed to $2.35 trillion, securing its status as the world's fifth-largest FDI destination.

Serving as China's premier gateway to global markets, Hong Kong functions as both a strategic entry point for international capital targeting mainland opportunities and an observation hub for market dynamics. Key patterns in foreign capital distribution emerged:

1. Accelerated Capital Inflows Global investors increasingly accessed mainland capital markets through Hong Kong's financial infrastructure. Bond Connect's Northbound Trading segment recorded RMB1.0089 trillion in transactions during April alone – the highest monthly volume in 2024. From January to April, offshore investors channeled RMB3.7399 trillion into mainland bonds via Hong Kong.

2. Evolving Investor Profiles European and American institutional capital, particularly long-term funds, flowed into Hong Kong starting September 2024, drawn by attractive equity valuations and safe-haven positioning. Simultaneously, Middle Eastern investors expanded their footprint: - Primary markets saw strategic investments in joint ventures and digital/logistics infrastructure with mainland partners, aiming for economic diversification beyond financial returns. - Secondary markets benefited from enhanced connectivity, with the Hong Kong Exchange adding Saudi, Abu Dhabi, and Dubai bourses to its recognized exchange list over the past two years, facilitating cross-border product flows.

Hong Kong's unique "one country, two systems" framework and global financial hub status underpin its sustained appeal. Core competitive advantages include:

1. Economic Resilience Hong Kong's economy grew 3.1% year-on-year in Q1 2025, driven by robust goods and services exports. The government forecasts 2%-3% GDP expansion for the full year.

2. Global Leadership Across Sectors - Finance: Ranked third in the Global Financial Centres Index and fourth in global IPO fundraising for 2024; maintains Asia's fifth-largest equity market. - Logistics: Home to the world's busiest international air cargo airport and fourth-ranked global shipping center. - Innovation: Ranked 18th in WIPO's 2024 Global Innovation Index, signaling rapid tech ecosystem development.

3. Unparalleled Trade Architecture As one of the planet's most open economies, Hong Kong holds separate WTO membership status and actively champions free trade. The upgraded CEPA agreement now spans services, goods, investment, and technical cooperation with the mainland.

4. Mainland Integration Bilateral trade reached $309.7 billion in 2024, representing 5% of China's total foreign trade. Hong Kong remained the mainland's second-largest export market with $291.14 billion in shipments.

Looking ahead, Hong Kong will further refine its business environment, leveraging its distinctive strengths to bridge global capital with China's economic opportunities, fostering mutual prosperity and regional advancement.