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Invest Hong Kong (InvestHK) had a very active and productive year in 2002. Over the past 12 months, the department attracted and successfully assisted 117 foreign companies to set up or expand existing operations in Hong Kong -- the highest ever number of projects. Between them the projects generated total investment of more than HK$1.36 billion (US$174 million) and created over 2,070 jobs.

The Director-General of Investment Promotion at InvestHK, Mr Mike Rowse, said today (January 6): "I am delighted to report that 2002 was the most successful year in the history of investment promotion in Hong Kong -- despite very considerable regional and global economic challenges."

"The SAR remains foreign companies' launch pad for international brands and new products. It is also their preferred Asian base to tap the huge potential of the Mainland market," continued Mr Rowse.

"Companies are still coming in and expanding their operations in Hong Kong. Last year, Philips Electronics relocated its Asia regional headquarters (RHQ) from Singapore, BT Ignite moved its Asia Pacific RHQ from Australia, Swiss Re moved its Asia RHQ from Zurich, British American Tobacco relocated its Asia RHQ from Malaysia, and the Armani Group opened its largest flagship store in the world outside Milan."

Mr Rowse cited findings of the "World Investment Report 2002" published by the United Nations Conference on Trade and Development (UNCTAD).

"In terms of Foreign Direct Investment (FDI), we continue to be second only to Mainland China in the entire Asia Pacific region. And the number of RHQs set up by foreign-owned companies in the SAR reached another all-time high -- at 948," he said.

Mr Rowse commented, "It is encouraging that Hong Kong has maintained its position as a major destination for FDI. This is particularly important in times when overall FDI flows to the Asia-Pacific declined by 24% to US$102 billion. Even so, the SAR's FDI at US$22.8 billion was larger than the total of the next four Asian markets on the list, namely, Singapore, Japan, Taiwan and Thailand, added together.

"Being named the best-performing host economy for FDI in Asia and second in the world after Belgium/Luxembourg clearly confirms that Hong Kong's business environment and its fundamentals remain highly attractive to international investors."

For the first three quarters of 2002, the Census and Statistics Department reported FDI inflow of HK$105.24 billion (US$13.49 billion) in Hong Kong.

A survey conducted by the Census and Statistics Department showed that as at June 1, 2002, the total number of RHQs, regional offices and local offices established by foreign-owned companies in the territory reached 4,867, a nine per cent rise when compared with the 2001 survey.

"During the period from June to December 2002, we noted from media reports that at least another 27 new RHQs were under planning or have been set up here," he added.

Mr Rowse said: "I look forward to further progress on several major projects that will contribute substantially to investment here and bring economic benefits. The ground-breaking ceremony for Hong Kong Disneyland will take place in a few days' time. A site on Ma Wan Island for another major tourism project is now under tender. We will be seeking proposals from the private sector for a tourism and entertainment project in Central in the first quarter of 2003. And we expect to invite tenders for the new International Exhibition Centre at Chek Lap Kok later this month."

"I am confident that 2003 will be another very busy and successful year for foreign investment in Hong Kong," he said.

Referring to increased co-operation with the Mainland, Mr Rowse said: "While foreign investors of all sizes consider Hong Kong as a strategic partner for accessing the Mainland market, Mainland private enterprises regard the territory as a springboard to 'go international'."

To attract Mainland enterprises to invest in the SAR, a Mainland Team and two Investment Promotion Units (IPUs) were created within InvestHK. The Shanghai IPU targets Mainland firms headquartered in Shanghai and the Jiangsu and Zhejiang Provinces, whereas the Beijing IPU covers Beijing and Tianjin. Besides, an IPU was set up in the Guangdong Economic and Trade Office in Guangzhou.

During the past 12 months, InvestHK worked with the Ministry of Foreign Trade and Economic Co-operation (MOFTEC) to organise two Mainland private enterprise delegations to Hong Kong. The department held investment promotion seminars in Jinan (Shandong), Chengdu (Sichuan) and Nanjing (Jiangsu). It also took part in the 6th China International Fair for Investment and Trade in Xiamen (Fujian).

In September, InvestHK and the Bureau of Foreign Trade and Economic Co-operation (BOFTEC) of Guangzhou Municipality jointly held the "Hong Kong-Guangzhou Investment Environment Seminar" in Tokyo. It was an unqualified success, attracting more than 160 senior representatives from over 100 Japanese companies.

Last year, InvestHK sponsored and participated in several major international and regional events and conferences. These included the 11th Annual BusinessWeek Asia Leadership Forum in June, the 2002 Forbes Global CEO Conference in September, the CNBC/TNT Asia Business Leader Awards in October, the 16th World Congress of Accountants in November and the International Telecommunication Union's convention in December.

Mr Rowse said: "These prestigious conferences and business events put Hong Kong, as the host city, in the international spotlight and remind the participants that this is the place to be if they consider establishing operations in Asia.¡¨

InvestHK also sponsored the yacht "Spirit of Hong Kong" in the Challenge Transat 2002 and the "Hong Kong Clipper" in the Clipper 2002 Round the World Yacht Race, as part of its strategy to sustain its brand building and international investment promotion efforts.

InvestHK received outside recognition for its efforts in 2002. In the July/August edition, the magazine "Strategic Direct Investor" named the government agency as Number 1 in Asia for the speed and quality of its responsiveness to foreign investors. And in November, Hong Kong's top advertising and marketing professionals selected Invest Hong Kong as one of the SAR's "Superbrands".

The year 2002 saw frequent overseas visits by InvestHK's directorate and investment promotion staff. They called on companies with an interest in Hong Kong and promoted the territory as a destination for inward investment.

In conjunction with some of these visits, InvestHK launched a new Community Programme covering the Netherlands, France and Japan, in co-operation with Consulates and business organisations to attract overseas companies to establish a local presence.

To provide useful information and a further point of contact for potential investors, InvestHK improved its online presence through a revamp of its website (www.InvestHK.gov.hk).

Mr Rowse said: "We are very pleased with the achievements of 2002. At the same time, InvestHK regards them as an incentive to devote more efforts to make Hong Kong the preferred business hub for companies setting up or expanding operations in Asia. Facing strong competition for FDI in the region, we can help realise our objectives by continuing to enhance our advantages to ensure that we remain Asia's best business environment.

"We look forward to expanding our relationships with the international business community, and to the opportunity to contribute to the success of their operations in Hong Kong, China and the Asian region."

Mr Rowse added: "We also see great opportunities to co-operate with our Mainland counterparts in promoting the advantages of Hong Kong and the Mainland, especially the Pearl River Delta - separately and jointly - as an investment destination following China's accession to the World Trade Organisation.

"In April, we will hold the 'Hong Kong - Shenzhen Investment Environment Seminar' in San Francisco jointly with the Shenzhen BOFTEC."

InvestHK will continue to host and participate in international events, for example, the Rugby 7s in March and the BusinessWeek Conferences in Hong Kong and throughout Asia during 2003. In April, the "Hong Kong Clipper" and seven other yachts competing in a six-leg, 16-port round the world race will arrive at Hong Kong.

End/Monday, January 6, 2003

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