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American companies looking to expand their markets overseas should consider Hong Kong as the springboard to access markets in Mainland China and Asia, said Director of the Hong Kong Economic and Trade Office, New York, Ms Anita Chan.
Speaking at a Boston breakfast event, organised by the Hong Kong Association of Massachusetts, today (November 19, Boston time), Ms Chan noted that many Massachusetts-based companies in various sectors, such as technology, financial services, legal, medical products, and insurance, have set up or expanded their presence in Hong Kong. These include Fortune 500 companies, listed companies and even start-ups.
These companies cited Hong Kong's attributes such as its strong rule of law and intellectual property protection, clean and efficient government, its central geographic location and efficient transportation network as well as the territory's close and unique economic link with the Mainland China as important considerations for setting up offices in Hong Kong.
"Whatever line of business you are in and whether it is big or small, Hong Kong has something attractive and unique to offer if you wish to tap the vast China and Asia markets," said Ms Chan.
Ms Chan highlighted that businesses in Hong Kong can benefit from the special free trade agreement called the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA), which is "nationality-blind" and does not impose any restriction over the source of capital. Thus, any overseas company, including those from the United States, that register in Hong Kong are eligible to enjoy the benefits under CEPA.
Under this arrangement, all products of Hong Kong fulfilling mutually agreed rules of origin can enjoy zero tariff treatment upon importation to the Mainland. To date, over 1,500 items of goods have been included. CEPA also liberalised 44 services sectors, enabling suppliers to enjoy preferential treatments to set up business in various sectors in the Mainland, among which are accounting, banking, convention and exhibition and logistics, to name a few.
Ms Chan added that CEPA is not a static arrangement with both the Mainland and Hong Kong authorities introducing further liberalisation measures that will make it easier for Hong Kong-based firms, including foreign firms, to enter the Chinese market.
American businesses can also benefit from transport development programme that will greatly enhance people and cargo flow between Hong Kong and the Mainland, said Ms Chan.
The Hong Kong-Zhuhai-Macao Bridge will trim the travel time from Zhuhai to the Hong Kong International Airport from four hours to 30 minutes. The bridge will also open up the Western Pearl River Delta consumer markets – a 50-million consumer base within a three-hour commuting radius from Hong Kong.
Another large-scale project is the Guangzhou-Shenzhen-Hong Kong Express Rail Link, a high-speed rail link that will cut travel time between Hong Kong and Guangzhou from 100 minutes to 48 minutes and will put Hong Kong on China's national railway map.
"This means not only faster, easier access to Mainland China from Hong Kong, but more importantly, bringing more Chinese businesses and consumers to Hong Kong, creating greater demand for all kinds of goods and services they wish to get in Hong Kong," said Ms Chan.
Noting that financial-services remains Hong Kong's forte, Ms Chan highlighted Hong Kong's new and widely-recognised role as an offshore Renminbi (RMB) trading centre. "We are now the largest RMB trade settlement centre for China, handling 75% of China's global cross-border trade in RMB," she said.
Ms Chan said Hong Kong will continue to work with the Mainland authorities to ensure the city plays an even stronger role in this regard. "This means more RMB business coming to Hong Kong, and greater ease in the use of RMB in our city," she said. "This 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."
Ms Chan also provided an update on Hong Kong's latest economic development, noting the brisk economic expansion in Hong Kong, registering a robust 6.8% growth in the third quarter of 2010. "Our GDP forecast for 2010 has been revised upwards to 6.5%, surpassing initial forecast projection of 5% to 6%," she said.
In her concluding remarks, Ms Chan said that more and more companies from around the world were interested in expanding their business in the Mainland. She encouraged US companies to use Hong Kong as a springboard, "for there is no city closer to the Mainland and so open, free, safe, and business-friendly."
Ends/Saturday, November 20, 2010
Issued at HKT 10:27
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