We opened our very first hotel in Asia in Hong Kong in 1989. This was really a big jump for us all the way across the Pacific Ocean. Many asked me why we didn't get there earlier and why it took so long. I said we had to get to San Francisco first as we were an East Coast company and it took a long time to cross the United States and even longer to get to China.
I recently returned from a 9-day trip to Asia and again visited the Hong Kong JW Marriott hotel. Each time, I’m impressed with the tremendous vitality and energy of this phenomenal city of Hong Kong.
To me, it is the pinnacle of free enterprise. In my opinion if all the world’s economies performed like Hong Kong the world would not be suffering its current economic malaise and difficulties.
On my recent visit I learned that Hong Kong is the world’s third largest financial center after New York and London. There are 1400 US firms located in Hong Kong and the U.S. trade surplus to Hong Kong is our largest.
When I talk to business leaders there in that wonderful city, they believe that Hong Kong thrives because the government is small, there is less regulation and, most importantly, taxes are very low.
For instance, there is no sales tax, no capital gain tax, no tax on dividends, and no VAT tax. Business profits tax is 16.5% compared with 35-40% in the United States. But now here’s the big deal – individual income tax is 15% maximum. Middle income families pay 5% or less in taxes. So is the city going broke? No. In fact, in 2011 the city did so well they gave a distribution of US $900 to every citizen.
Hong Kong growth is slowing this year – primarily due to lower growth in Europe and the U.S., their major trading partners. But unemployment was only 3.4% last year. And that really represents full employment. That compares, of course, to over 8% in America. Is this any way to run a country? Well, you can be the judge.
I’m Bill Marriott and thanks for helping me keep Marriott on the move.