Hong Kong is currently one of the fastest growing international financial centers in the world. Between 2008 and 2013, Hong Kong’s wealth management industry witnessed a growth rate of 146 per cent. There has also been estimation about Hong Kong’s offshore wealth sector growing by approximately 10 percent annually to 2020 – the fastest for any major center.
The jurisdiction is thus widely used by corporations to shift profits to escape paying their fair share of taxes, an abusive tax practice termed “transfer mispricing.” Hong Kong is also a major round-tripping jurisdiction for Chinese capital that illicitly fled the country, to be reinvested as foreign direct investment back into mainland China through Hong Kong. The Tax Justice Network ranks Hong Kong in the second place on its Financial Secrecy Index, only behind Switzerland. A large part of these practices is possible because of the wonders of anonymous companies.