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The Director-General of the Hong Kong Economic and Trade Office, London, today (September 19) spoke on how global community could ride on the competitive advantages of Hong Kong for success in Mainland China, the largest ever emerging market in the world.

Mr Andrew Leung opened his speech at a business seminar organised by the Hong Kong Trade Development Council in Croatia by cataloguing what he described as sets of "stunning figures" characterising the China market.

"The size of the China market is estimated at US$1.2 trillion, growing at an annual average of 7 per cent.

"Targeted growth will amount to one third of Japan's projected GDP in 2005, and exceed that of Germany by 2010," he said.

On manufacturing, Mr Leung noted, China was becoming the "Factory of the World", accounting for 29 per cent of the world's production of colour television sets, 32 per cent of air conditioners, 50 per cent of photocopiers and 21 per cent of personal computers, with "rising levels of quality and sophistication".

Mr Leung made a special reference to the rapid growth of China's huge domestic market, adding that the rising disposable income of an expanding middle-class would be immense business opportunities to the world.

"The pace of development in China is almost breathless, especially in the wake of its accession to the World Trade Organisation (WTO)," he said.

"Hong Kong has all the way played a pivotal role in fuelling this breakneck development.

"We are the dynamo behind the Pearl River Delta powerhouse, a key logistic portal for the flow of its multifarious goods and services, and a leading international banker to the entire China market," he added.

Hong Kong accounts for 48 per cent of the total foreign direct investment in the whole of China.

In Guangdong, Hong Kong enterprises have invested more than US$70 billion, about three-quarters of all foreign direct investment in the province. About 5 million people are employed by more than 40,000 companies wholly or partly owned by Hong Kong concerns.

"In particular, the 'Factory of the World' is situated in the Pearl River Delta, the powerhouse of Guangdong, a vast megapolis with a population of 48 million and a GDP of US$258 billion, larger than Switzerland, Sweden or Austria," Mr Leung added.

"The whole world is competing to move into Mainland China.

"The synergy of Hong Kong and the Mainland, based on a unique ethnic relationship and an increasing economic interaction and integration, makes the city well poised as a strategic partner for international enterprises to establish a foothold in that vast market," Mr Leung said.

In his speech, Mr Leung also outlined Hong Kong's competition edge over other cities.

"Hong Kong's unique blend of rule of law, transparency, freedoms, financial sophistication and business efficiency, concentration of over 100,000 companies proficient in China trade, coupled with a multitude of fully networked multinational companies and Mainland enterprises, cannot be easily replaced.

"Added to the list is our pool of expertises, in finance, international commerce, law, accounting, insurance, marketing, freight, and logistics," he said.

Mr Leung noted that international trade was not a zero-sum game.

"Large markets like the United States, the European Union and China definitely require more than one business portal," he added.

Mr Leung told leading Croatian businessmen attending the seminar that the number of international enterprises setting up regional headquarters in Hong Kong had continued to increase even at a time of global economic downturn.

The number of new US companies set up in Hong Kong has grown by 33 per cent, Japanese companies by 44 per cent, Australian by 53 per cent and those from Europe increased by 23 per cent during the past two years of world recession.

A just published United Nations Conference on Trade and Development's World Investment Report for 2002 ranks Hong Kong second in attracting global foreign investments.

In this regard, Mr Leung noted, it was vital for Hong Kong to further enhance its economic and infrastructural links with the Mainland.

Measures implemented or planned include:

* To invest US$75 billion in rail and urban infrastructure in 15 years;

* To introduce multi-entry business visas for investors;

* Extended boundary operational hours at Lo Wu until midnight.

In addition, an Economic and Trade Office has been set up in Guangzhou to service Hong Kong entrepreneurs.

"The government will strive to foster closer economic partnership with the Mainland, not least the Pearl River Delta," he said.

During his two-day visit to Croatia, Mr Leung held meeting with senior government officials from the Croatian Ministry of Economy.

He also took the opportunity to meet media representatives to brief them on the latest political and economic development of Hong Kong.

This seminar on the business environment and investment opportunities in Hong Kong was the first of its kind ever held in Croatia.

Other speakers included the Managing Director, International Relations Department, Croatian Chamber of Economy, Mrs Dunja Konjevod; and Regional Director, Central and Eastern Europe, Hong Kong Trade Development Council, Ms Lore Buscher.

Chinese Ambassador to Croatia, Mr Zhi Zaolin, and Ambassador of Croatia in Beijing, Mr Zeljko Kirincic, also attended the seminar.

End/Thursday, September 19, 2002

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