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in the Asia Pacific Region Ladies and gentlemen, 1. I am delighted to have the opportunity to speak to you tonight. Heading an office called the Hong Kong Economic & Trade Office, I have often been asked the question: "If a Canadian company wants to expand its business in the Asia Pacific Region, why should it consider setting up its regional office in Hong Kong?" This is a valid question - and I would like to provide some answers. A case study of a Canadian biotech enterprise 2. But before I do, let me first of all tell you the experience of a Canadian company. A bio-tech company based in Edmonton became interested in expanding in the Asian market. The company is interested in applying its technology in the identification and extracting of active ingredients in traditional Chinese herbal medicines. When the founder visited Hong Kong two years ago, he considered that Hong Kong was the prime location for the development of the company because of Hong Kong's strong ties with the TCM institutions in China and Hong Kong's developed business infrastructure and stable investment environment. Through our office, the company was introduced to various TCM research institutions in Hong Kong. Eventually, it entered into two collaborative programs with the Hong Kong University of Science and Technology and the Chinese University of Hong Kong. These programs also received funding from the Hong Kong Government through the Innovation and Technology Commission, a government agency whose responsibility is to promote the development of advance technology. The company has registered in Hong Kong and will move into the Science Park of Hong Kong in Pak Shek Kok in Tai Po. 3. The case study is interesting in that it illustrates several advantages Hong Kong has, namely,
4. In Hong Kong, we welcome companies from all over the world to do business here because we believe more competition will bring better service and price to the end-users. In the year 2000, for example, the Government Supplies Department of Hong Kong Government purchased almost 10 million Canadian dollars' worth of Canadian goods and services. This was not the result of any quota for Canadian companies but because these Canadian companies beat the others through open, fair and transparent tender exercises. It is the Hong Kong Government's policy, when purchasing products for all government departments, to adopt an open and fair procurement policy by purchasing the products that represent best value for money, irrespective of country of origin. 5. In the private sector, government strategy has always been that we create a suitable business environment and impose minimum constraints to facilitate the flow of goods, capital and talents. While we place no barrier on any company, neither do we favour companies of any nationality. The highly competitive environment of Hong Kong will ensure that the fittest will prosper. Our regulatory regime is there to protect the investors and the public from abuses, not to interfere with the free market economy. Our law enforcement agencies are vigilant in making sure that commercial activities are carried out in accordance with the law. Canadian companies, like any others, are free to register in Hong Kong, and will be treated like any other Hong Kong based company. Professionals with skills which are needed in Hong Kong are always welcome, so long as they can provide proof of an employment offer. We do not have quotas on talents from overseas, and will soon lift restrictions on Mainland talents to be admitted into Hong Kong. Hong Kong - the Gateway to China 6. Still, you may ask, why should Canadian investors invest in Hong Kong rather than other Asian economies? The biggest asset Hong Kong has is our huge business potentials as a result of our close economic relationship with the Mainland. Ever since the Mainland adopted the open-door policy in the eighties, Hong Kong businessmen have been actively doing business in the Mainland. Some moved their factories to Southern China while many were involved in "China trade". A large number of Hong Kong corporations also participated in real estate developments and infrastructural projects in China. During the past two and a half decades, Hong Kong businessmen have successfully established themselves in the Mainland and have developed an extensive business network in China. Indeed the bulk of direct foreign investment in Southern China came from Hong Kong businessmen. 7. On the other hand, with growing prosperity in the Pearl River Delta, the investment from Mainland companies into Hong Kong has been on the increase. The Mainland market has become more mature and the scope for joint ventures has grown substantially. The economic integration of Hong Kong, Shenzhen and Guangdong province presents tremendous business opportunities for overseas investors. 8. Hong Kong's niche is our understanding of the Mainland system and regulations, our linguistic abilities in both Chinese and English, and our long-established business relationship with the Mainland business sectors. The marriage of Hong Kong's world class financial, marketing and technical expertise and sophisticated infrastructure with the Mainland's rapidly developing manufacturing and service base have created a winning formula. 9. For Canadian companies who want to develop the Chinese Mainland market, Hong Kong is the natural base. We in Hong Kong have the common law legal system, the language and cultural capabilities to bridge East and West, a pro-business environment, an efficient government and an extensive business network in the Mainland and the rest of the world. 10. Geographically, Hong Kong provides the ideal base for any company's Asian opportunities. It is within easy reach of East Asia - Korea, Japan and Taiwan. A trip to South East Asian destinations, such as Malaysia, Vietnam or Thailand will only take a few hours. Even Australia and New Zealand are easily accessible by air. Hong Kong is one of the best-connected cities in Asia, with its world-class container port and airport working 24 hours a day to whisk passengers and goods to their final destinations. In this era of information technology, Hong Kong also boasts our high Internet connectivity. No wonder in a recent survey of 8,000 international corporations, Hong Kong is ranked the most desirable place for these corporations to set up their regional base with command of business covering the entire Asia Pacific Region. 11. Canadian International Trade Minister Pierre Pettigrew told us in late March that in the year 2000, export of goods and services accounted for 45.6% of Canadian gross domestic product. Canadian exports increased by 15% in 2000, to a record $474 billion. At the same time, Canadian direct investment abroad rose by $31.2 billion to $301.4 billion. Admittedly, the bulk of Canadian trade is with the United States but with the slowing down of the US economy, Asian markets provide an attractive alternative for Canadian companies who want to diversify and develop. I hope my earlier analysis demonstrates clearly that Hong Kong is the obvious choice for your expansion into the Asia Pacific Region. We look forward to our partnership with you for further growth. Thank you. 6 April 2001 The Mississauga Board of Chinese Professional event Back to "Speeches" |