Following is a speech by the Secretary for Commerce, Industry and Technology, Mr John Tsang, at the "Best under a Billion" - Forbes Global's 200 Best Small Companies Award Ceremony tonight (November 4) (English only):
Distinguished Guests, Ladies and Gentlemen,
It is a great pleasure for me to be here today at the "Best under a Billion" Forbes Global's 200 Best Small Companies Award Ceremony. I would like to congratulate all of you for being selected to join the exclusive company of the "Best Under a Billion." This is an outstanding achievement for you and the companies that you represent.
For those of you who have come from overseas, I would like to welcome you all to Hong Kong, a city where economic development has been driven by the innovation, energy and commitment of our small and medium-sized enterprises.
We have some 300,000 SMEs in Hong Kong. They constitute over 98% of our business establishments, and they employ about 60 % of our workforce. Their vitality and success are of crucial importance to the development of our economy. They are the true backbone of our success.
Hong Kong is an attractive location for SMEs to establish their base camps for investment and expansion of their operations throughout the region. In fact, many of our foreign investors are SMEs.
Hong Kong offers sound economic fundamentals, combined with a regulatory environment that helps companies to prosper. Built around the cornerstones of free enterprise, free trade and free markets, Hong Kong is one of the most open, most externally orientated economies in the world.
Our city is a duty-free port, where no quotas or tariffs apply. Money, goods and services flow without friction. A strong financial system underpins the economy.
Hong Kong taxes are among the lowest in the world. The city also offers an abundance of skilled labour, as well as a pool of professional service providers, who are unrivalled in the region.
Life in Hong Kong is based on the rule of law, providing a level playing field for individuals and enterprises. This guarantees a safe and predictable investment environment. Intellectual property rights are well protected through a sophisticated legal framework and effective enforcement regime.
These fundamentals have helped to establish Hong Kong as one of the most attractive business hubs in the region. It is the second largest recipient of FDI in Asia after China, and 15th in the world, according to the World Investment Report 2003 published by the United Nations Conference on Trade and Development (UNCTAD). Hong Kong is also the chosen base for over 3,200 regional headquarters and regional offices representing multinational companies from around the world.
On 29 June 2003, the Central People's Government and Hong Kong SAR Government signed the Closer Economic Partnership Arrangement (CEPA).
This Arrangement is basically a free trade agreement between two WTO members, and covers three main areas: Trade in Goods, Trade in Services, and Trade and Investment Facilitation. On trade in goods, 273 Hong Kong products will enjoy zero tariffs in the Mainland market starting from 1 January 2004. On trade in services, 18 sectors will gain greater market access in the Mainland.
This free trade agreement is the first for both Mainland China and Hong Kong. It creates immense potential for Hong Kong to become a centre for value added manufacturing and high quality services for a vast domestic market of 1.3 billion people. It also offers new opportunities for SMEs using Hong Kong as the springboard to expand into the Mainland China market.
With China's accession to the WTO and the signing of CEPA, Hong Kong's role as an international trade and business centre and the gateway to China will be further strengthened. The emergence of Mainland China as one of the most dynamic economies in the world has also offered a range of additional opportunities, especially in the Pearl River Delta.
The PRD is the fastest growing region of the fastest growing large economy in the world, with a population of 41 million and double-digit average annual growth for more than a decade. Each day, an estimated US$300 million worth of goods are produced by thousands of factories in the region.
For companies looking to profit from a Hong Kong/Pearl River Delta strategy, Hong Kong-based companies are ideal partners. They provide considerable value, including capital, resources and long-standing relationships on the Mainland based on decades of experience.
This is just a brief overview of the advantages Hong Kong has to offer. Over the next few days, I am sure you will have a lot of opportunities to meet with people, discuss business and see for yourselves what Hong Kong is all about.
I wish you all an enjoyable stay in Hong Kong, and I hope that in the near future, we can welcome some of you back as new investors in Asia's World City.
Ends/Tuesday, November 4, 2003