*********************************************************
Canadian companies have today (April 5, Hong Kong time) been urged by the Chief Executive, Mr Tung Chee Hwa, to seek new business opportunities in Hong Kong and Asia.
Speaking at a high-powered dinner organised by the influential Business Council on National Issues and attended by more than 200 of Canada's top business executives, Mr Tung said Canadian companies had products and expertise that would be of interest in the Asian market.
"I know well, your major markets are right close by home in North America. The United States is too big a market, too close to home and too easy to sell to," Mr Tung said.
"I would urge you to come to Asia and do a whole lot more there because the market is a very big one. In 10 years' time, the combined GDP of the Asian countries will be as large as NAFTA or the European Union.
"So the market is out there. I have to tell you I am very impressed by the range of products that Canada has to offer. Come and sell. And let me say one more time, promoting Hong Kong, use Hong Kong as your base."
Asia market potential could be gauged by the combined size of the nine East Asian economies, excluding Japan, which stood at US$2,350 billion in 1999. China's economy alone accounted for US$991 billion - or 42 per cent of East Asian GDP in 1999. Canada's GDP, by comparison, stood at US$639 billion in 1999.
Mr Tung said Canada and Hong Kong had always had a special relationship. This gave Canadian companies a strong existing base from which to expand operations in Asia or build new ones.
About 100 Canadian companies have branches or subsidiary operations in the SAR, while another 450 are represented by distributors, agents or joint ventures.
"You have almost C$3 billion worth of investments in Hong Kong. But more importantly, you have the people-to-people contacts. It is estimated that there are about 150,000 Canadians living and working in Hong Kong," he said.
The Chief Executive briefed the business chiefs on Hong Kong's economic recovery and the challenges stemming from increasing globalisation, advances in technology, continued reform and opening up of the Mainland economy and competition from within the East Asian region.
"We are faced with great challenges. But we are also seeing great opportunities," he said.
"According to the World Bank, China's gross national product currently ranks seventh in the world, and will rise to third or fourth by 2020, with an enormous cumulative growth in the interim.
"As China's economy grows, Hong Kong stands to benefit greatly if we can play an active part in this process."
Mr Tung said Hong Kong was strongly aware of the need to constantly improve competitiveness.
He said that Hong Kong was consolidating its strengths through reforms in the financial markets, new tourism initiatives, the expansion of the container port and the development of the international air cargo sector.
Much was being done to improve competitiveness, which would help attract multi-national corporations to establish regional operations in Hong Kong.
"We are acutely conscious of Hong Kong's high costs compared with some of the other cities in the region," he said.
"Fortunately, housing costs have reduced substantially and greater efficiency is being gained by the wider use of information technology."
He said Hong Kong was pressing ahead with a far-reaching reform of the education system to prepare young people for the challenges of the knowledge-based society of the 21st Century.
"I am determined to make Hong Kong one of the most attractive cities in the world in which to live and work," he said.
End/Wednesday, April 5, 2000
NNNN