Entrepreneurship is a set of ideas that require capital and finances to commence and create economic value. Generally, entrepreneurship is referred to as the art of doing business. People often confuse it with the businessman.
Although both serve the same purpose of economic activity; however, entrepreneurship involves the new ideas to explore different things.
The concept of entrepreneurship evolves with the introduction of new and modern business practices. A business is not confined to one location or location-dependent, especially in entrepreneurship, required to execute different business activities more efficiently and effectively.
Entrepreneurs worldwide are looking for countries and territories that are entrepreneurship friendly and encourage it. Similarly, Russian entrepreneurs are flocking to Hong Kong to pursue their careers; the reasons and things that make these Russian entrepreneurs move to Hong Kong and why they are leaving Russia are as follows:
Hong Kong’s government understands and supports different business and entrepreneurial models and has hosted many entrepreneurial ventures; these small, impactful steps place Hong Kong in a more progressive state.
Hong Kong understands and recognizes that these entrepreneurial activities are necessary for economic growth; they also initiated several development programs. All these initiatives and practices put Hong Kong on the map of lucrative markets for doing business.
In recent years, the development in the Southeast Asia region also helped attract several Chinese and other nationals to enter Hong Kong and expand their overseas market. One of the major advantages of doing business in Hong Kong is that it allows startups and businesses to set up and operate with the lowest investments.
They incorporate lower investment policies. Besides that, Hong Kong is also known for its progress and advancement in commercial sectors, especially in maintenance and logistics; these factors also boost the region’s overall business ecosystem and entrepreneurs.
The 21st-century entrepreneurs also place the Hong Kong fair trade policies and corporate legal framework as a reason to successfully attract investments and provide a suitable environment for the entrepreneur’s business lineup. Moreover, lower entry and operating costs compared to other global markets also benefit Hong Kong entrepreneurs.
The foreign direct investment rules are also designed to support, encourage, and increase the foreign entrepreneurs; it brings more opportunities and stability for the new and existing entrepreneurs. A development like this made Hong Kong the 8th largest economy globally and the 15th largest in commercial exporting.
Last but not least, a stable political and legal environment and its consequences also play it partly in the making, involving and increasing the entrepreneurial businesses in Hong Kong. Other potential factors include Hong Kong’s financial strength, which comprises FOREX reserves, 344.8 Billion US dollars as of June 2015, ensuring the optimal funds required for a consistent GDP growth rate.
Russia has been criticized for its national business environment for a longer period, influenced by political and strong bureaucratic interventions. The legal structure and stiff governmental attitude are other main reasons criticized for discouraging entrepreneurship and scope in the nation.
Due to its rigid, strict, and controlled business environment, the Russian economy has created a situation of confusion, especially before the 2007-08 economic recessions. But recent changes positively affect small and medium enterprises (SMEs sector) and increase the number of entrepreneurs within the nation.
Despite the recent growth and development in the SME sector, it remains sluggish compared to other BRICS nations. It is mainly due to the restructuring of the business environment, which impacts the economic activity and results in economic and social instability. These conditions increase the challenges for entrepreneurs and other businesses to carry out their operations and thrive in Russia.
The local entrepreneurs are less prone to these challenges due to their understanding and way of doing things. Still, for international and overseas businesses, the Russian business culture differs from the norms of the world economy.
Due to this difference, international entrepreneurs are refraining from entering the market. Also, they can face a lack of resource mobilization advantage.
These reasons are responsible for the lack of innovative ideas; therefore, more entrepreneurs migrate to other nations or territories with more favorable business-friendly environments, such as Hong Kong.
We discussed business environments in Russia and Hong Kong; it is pretty clear that the core difference between them is how things work for entrepreneurs and small businesses.
The main difference between these two territories is the ease of doing business and resource mobilization opportunities. Both these factors impact on growth and implementation of innovative ideas.
Hong Kong was ranked 2nd place on the ease of doing business index in the world in 2014; it shows Hong Kong’s commitment and steps to entertaining entrepreneurial ideas and providing the right place and opportunities for businesses to explore new horizons.
Russia stands at 92nd position in the ease of doing business index in the same year; in the case of Russia, its standing shows the rigidity and lack of policymaking for welcoming international entrepreneurs and providing a sustainable business environment.
Further, a more critical analysis of the business environment in both countries depicts that Hong Kong is a more suitable and friendly place for businesses than Russia. The socio-economic policies in Russia are conventional and lack innovation.
In contrast, in the case of Hong Kong, the socio-economic environment is more diverse and welcoming, which attracts global entrepreneurs.
Hong Kong developed an efficient system to facilitate businesses over the years; the legal constraints and requirements for setting up a business are straightforward; compared to Russia, the same applies to consumer behaviors and market response.
Due to business-friendly systems and choices for customers, their behavior is more open and accepting, which eventually turns in favor of entrepreneurs and consumers.
Many factors are responsible for entrepreneurs moving from Russia to Hong Kong; they have many advantages that benefit the entrepreneurs in Hong Kong and help them establish and implement their ideas and minimize any obstacles.
Ease of Doing Business: One of the main reasons entrepreneurs are shifting from Russia to Hong Kong. The relaxation in the trade affairs, economic benefits, and more beneficial socio-economic benefits attract Russian Investors to invest and implement their ideas in a business-friendly environment.
Gateway to South Asian Markets: Hong Kong’s strategic location and access to other south Asian markets also play a huge role in making Hong Kong the economic Hub of South East Asia. Hong Kong’s business-friendly nature and support from the government also ease attaining their goals.
Economic Benefits: In the end, it’s all about economic benefits; any country that offers such benefits and offers a certain environment to businesses and refrains from any interference reaps the fruits and improves their socio-economic conditions and initiates developments in all sectors. These benefits are transferred to entrepreneurs, and they make a substantial amount of return on their investments.
Entrepreneurship demands a supportive and business-friendly environment. Due to the inclusion of new ideas and their implementation, every country or territory does not accept those ideas or provide effective opportunities.
Hong Kong is one country that has developed a robust and effective system to support and welcome entrepreneurs from around the world. Their ease of business environment, impressive socio-economic indicators, and gateway to other markets make it lucrative for Russian entrepreneurship and investors.
Russian business environment and stagnant policies make it difficult for new businesses and ideas to implement and thrive. Hong Kong is one of the best countries for Russian Entrepreneurs to start their journey.