Hong Kong Trade Development Council
During our visit with the Hong Kong Trade Development Council (HKTDC) Ms Cherry Lee spoke to us about the opportunities of doing business Hong Kong and China and why it is best to do business in China by going through Hong Kong. Ms Lee stated that the one country two system policy allows Hong Kong to be in a unique position by allowing business to be conducted under Hong Kong laws and to allow Hong Kong to be an arbiter for setting disputes between businesses from other countries and main land China.
The HKTDC was setup to facilitate matching companies between other countries and Hong Kong to encourage business in Hong Kong. The HKTDC is also focusing on facilitating business with mainland China however part of the supply chain must be in Hong Kong. An example may be that a US Company wishes to have control valves assembled in mainland China and shipped to North America and Europe. HKTDC will be able to assist the US company in finding a broker, wholesaler, shipper, etc. who are located in Hong Kong to help with the transaction.
Ms Lee gave us several advantages of doing business in Hong Kong, and in particular in doing business in mainland China through Hong Kong.
- Resilient Economy
- Hong Kong may be used for arbitration if the contract is signed in Hong Kong
- Low tax rate both personal and business
- Centrally located in the region
- Ability to travel to most major markets in the region within 4 hours
- Within 5 hours you are able to travel to ½ of the world’s population
- Dynamic People
- People speak multiple languages with most speaking English
- Communications – many people educated in the UK or US
Since Hong Kong was returned to China, Hong Kong has been in a unique position to help businesses understand how to do business in China and to provide unique services to bring foreign and mainland companies together. Ms Lee had a few slides which displayed how Hong Kong fits within the Value Chain. I was not able to capture the slides very well but I do recall that she pointed out at least three areas, two of which I was able to capture. The two areas were in finance and marketing.
I really enjoyed our visit there. I spoke with Ms Lee about some of the opportunities and services that HKTDC provides and intend to look into using some of HKTDC’s services in the future.
Team 2 and Aaron are ready for the first visit
Hong Kong University
Dr. Michael Enright gave us an overview of doing business in China and working with the Chinese Government. One of the first things that he impressed upon us is that things move very fast in China and the region. He stated that you can be out of touch with the US or Europe for a couple of months and you do not lose anything however if you leave the China and surrounding region for only two weeks up to 1/3 of what you knew is irrelevant so it is more important for businesses with business in the region to have a presence in the region.
Particularly China’s government may make changes to policy which is counter to previous initiatives. There are two main drivers for this behavior. First, China is driven by results not principles which mean that if something is not cultivating the desired result there is no hesitation to change things. The second thing is that there are three key areas which are nonnegotiable and must be protected. The first thing is that the Communist Party must remain in control of the government. Second, Taiwan must be part of China once again and the third is that Tibet must remain under Chinese control.
I want to thank Lee for putting Dr. Jacobina in touch with Dr. Enright. The meeting was very informative and it was clear that Dr. Enright is an authority on China's business climate.