Great article about Hong Kong and why it's still the most business-friendly place in the world, despite becoming part of China 10 years ago: http://www.american.com/archive/2007/march-april-magazine-contents/still...

The secret of Hong Kong’s success isn’t hard to find. It’s economic freedom, and everywhere a visitor is struck by how much of it there is. Red tape is almost unknown; registering a company requires only a one-page form. “A businessman can walk off a plane in the morning and start operating a firm in the afternoon,” reports The Economist. [...] Local entrepreneurs agree. “The top income tax rate is 16 percent, the top corporate rate is 17.5 percent [half that of the U.S.], and there are no capital gains taxes or sales taxes and complete free trade,” says Jim Thompson, the American-born chairman of the Crown Worldwide Group, a logistics company. Thompson, a Hong Kong resident for 28 years, says, “There’s no better place in the world to do business.”

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Government in Hong Kong remains much smaller than in most countries; public spending is only 18 percent of GDP, less than half the average of the developed nations that are members of the Organization for Economic Cooperation and Development (OECD). The government has announced plans to reduce the number of civil servants to 160,000 from 172,000. “We adhere to the principles of free enterprise and free competition,” says Chief Executive Donald Tsang, who recently had to retreat from hints that he favored a future Hong Kong government that took “a pro-active yet pro-market approach.”

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“I sat and asked myself what I could want from the government of Hong Kong,” Cheung told me. “I concluded that what I really wanted was the freedom I already had, and, what’s more, I didn’t think the Hong Kong official had the power to really pull strings for me in any meaningful way.”

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Henry Tang, the financial secretary, last month bluntly warned a visiting group from Canada that North Americans should worry first about government intervention in their own backyard. He noted that Wall Street’s relative decline as a financial trading center—in 2005 only one of the 25 largest initial public offerings took place there—can be directly traced to the Sarbanes-Oxley corporate accountability rules that were put in place following the Enron and WorldCom scandals. “Our success is giving [Treasury Secretary] Hank Paulson a few raised eyebrows,” he told the group. “Thank you, Mr. Sarbanes and Mr. Oxley!”