According to the Director of the Hong Kong Economic & Trade Office (ETO) in New York, Anita Chan, an influx of American companies are “pinning potential on markets overseas, and especially China.” She urged those who want to embrace China’s growth potential to use Hong Kong as a “springboard” because “there is no city so close to China and so open, free, and business-safe.”
Regional Senior Vice President & General Manager of Cathay Bank Johnny Ip welcomed guests and speakers at the Ritz Carlton Hotel in Boston for a “Breakfast Talk” hosted by the Hong Kong Association of Massachusetts on November 19th to discuss opportunities for business in Hong Kong. Attendees included a small audience of bankers, educators, importers, and lawyers.
In her talk, Chan addressed the reasons why Hong Kong has attracted so many U.S. companies and discussed Hong Kong’s economy, which just registered a 6.8% GDP growth in the third quarter of 2010.
Hong Kong is an attractive choice for many companies because of its intellectual property protection, its transportation network directly linked with Mainland China through both the Hong Kong-Zhuhai-Macao Bridge, and the upcoming Guangzhou-Hong Kong Express Rail link. Furthermore, its geography and economic tie with Mainland China under the Closer Economic Partnership Arrangement (CEPA) make it an important point of commerce.
Many Massachusetts companies and Fortune 500 companies have already taken advantage of Hong Kong as a means to expand business into China, according to Chan.
She noted also that Hong Kong is the largest Renminbi trade settlement Center for China, handling 75% of China’s global cross-border trade.
The influx of RMB businesses in Hong Kong will “benefit not just the large companies raising funds, the financial houses and asset management companies, law firms and accounting firms in Hong Kong, but also all companies using RMB for their business transactions and investors wishing to benefit from this increasingly important currency,” Chan said.
Chan outlined the business opportunities Hong Kong offers, noting that Hong Kong’s tax rates are among the lowest in the world, with no sales tax and capital gains tax and that Hong Kong remains a free and open society where human rights are respected.
The ETO’s mission is to strengthen Hong Kong’s economic and trading ties with the 31 states east of the Mississippi River and to serve as the primary source of information on Hong Kong for the east coast of the U.S.A.
Chan served as the Chief Interpreter for the Sino-British negotiations on the transition of Hong Kong from 1994 to 1997 before working in various government offices.
She explained that there are a lot of risks and challenges for companies that do not have prior experience conducting business in China. These include a lack of familiarity with both the language and culture as well as the bureaucracy.
“Hong Kong has accumulated many decades of experience dealing with Mainland China – many people know the market very well and know how to maneuver and navigate through the system – these people with connection to China make it easier and safer for a small and medium size companies,” Chan said.
Director of the New York Hong Kong Trade Development Council Byron Lee discussed further how Hong Kong helps manage opportunities and challenges in China. Lee noted that China has the largest car market in the world, over 800 million cell phone subscribers, and more than 380 million Internet users and that “China’s continued growth” will be “indispensable for economic growth of world in the upcoming years.”
Natalie Ornell is a Sampan correspondent.
