Mainland China accounted for the largest share of the total stock at 35.1%. The British Virgin Islands and Bermuda took up another 33.8% and 6.1% respectively of the total stock.

Meanwhile, the stock of Hong Kong's outward direct investment grew 44.1% from a year earlier, to $5.26 trillion at market value. Its ratio to GDP was 357%.

Analysed by immediate destination of investment, the British Virgin Islands remained the most popular 'tax haven economy' for indirect channelling of direct investment funds, accounting for 46.9% of the total stock of Hong Kong's outward direct investment.

Apart from offshore finance centres, China was the most important destination for Hong Kong's outward direct investment, with a share of 40.2% of the total stock.

The Census & Statistics Department said the surge of inward and outward direct investment underlined Hong Kong's status as a hub for regional headquarters and businesses, as well as an international financial centre.

China continued to feature distinctly in the city's external direct investment, and the Hong Kong government said that it will continue to work on economic and financial integration between Hong Kong and the Mainland, with a sound foundation having been laid by the Closer Economic Partnership Arrangement and its four supplements.

The main cross-boundary infrastructure projects announced in the 2007-08 Policy Address, when completed, will also enhance the flow of people and goods between the Mainland and Hong Kong, which in turn will serve the cause of enhancing investment flows, the government concluded.