Accounting Why is Hong Kong considered a tax haven? Hong Kong defers to mainland China in two primary areas: military defense and international relations. This coincided with the provisional MFN tariff rates being abolished for 39 import items, while the existing MFN provisional tariff rates remained in force for all goods unaffected by this latest round of cut. Second, absence of capital controls and greater international exposure, which allows Hong Kong to serve as an anchor point for global expansion. According to Hong Kong Securities and Futures Commission, as at end December , the market capitalisation of Shanghai Stock Exchange is the second-largest in Asia after Japan and the fourth largest in the world. As of Dec. Both share the President of China as their chief of state.