HONG KONG Turning China into Opportunity Peter Woo Chairman Hong Kong Trade Development Council...
Transcript of HONG KONG Turning China into Opportunity Peter Woo Chairman Hong Kong Trade Development Council...
HONG KONGTurning China into Opportunity
HONG KONGTurning China into Opportunity
Peter WooChairmanHong Kong Trade Development Council
Peter WooChairmanHong Kong Trade Development Council
January 2006
I. WHY CHINA?
II. WHY HONG KONG?
III. A TALE OF 3 CITIES
IV. TIME FOR ACTION
I. WHY CHINA?
II. WHY HONG KONG?
III. A TALE OF 3 CITIES
IV. TIME FOR ACTION
I. Why should you go to China?
Fast Growing Economy:• Out performed expectations in past 25 years
• GDP growth at 8.5% over 10 years
• GDP at US$2,000 billion - will double in next 10 years
• Out performed expectations in past 25 years
• GDP growth at 8.5% over 10 years
• GDP at US$2,000 billion - will double in next 10 years
The China story
Expanding Consumption Power
• Total retail sales at US$760 billion a year
• 250 million people in the “middle-class” (20% of population)
• This group will increase to 25% by 2010
• Total retail sales at US$760 billion a year
• 250 million people in the “middle-class” (20% of population)
• This group will increase to 25% by 2010
Expanding Luxury Market
The China story
• Huge consumption power of the new rich
• US$ 2 billion on luxury items in 2004
• 29% of the world's luxury market by 2015
• Huge consumption power of the new rich
• US$ 2 billion on luxury items in 2004
• 29% of the world's luxury market by 2015
Diverse China Markets
BEIJING
SHANGHAI
HONG KONG
The China story
• Beijing and Bohai Area
• Shanghai and Yangtze River Delta
• Greater Pearl River Delta
• Beijing and Bohai Area
• Shanghai and Yangtze River Delta
• Greater Pearl River Delta
China’s future direction:
• Balanced growth among different regions
• Further urbanization to lift living standards
• Move 200 million rural dwellers to cities in next 20-30 years
• Build/Expand 200 cities of 3 million people each
• Balanced growth among different regions
• Further urbanization to lift living standards
• Move 200 million rural dwellers to cities in next 20-30 years
• Build/Expand 200 cities of 3 million people each
II. Why Hong Kong?
Why should you go to Hong Kong for China business?
The Hong Kong Connectivity:
• Connectivity with the world markets
• Connectivity with the China markets
The Hong Kong Connectivity:
• Connectivity with the world markets
• Connectivity with the China markets
60 years ago, Hong Kong was nobody
Now, we are No. 11 in world trade
60 years ago, Hong Kong was nobody
Now, we are No. 11 in world trade
The Hong Kong Connectivity
Hong Kong’s core business – International Trade and Commerce
• Finance
• Trade and business services
• Transportation and logistics
• Finance
• Trade and business services
• Transportation and logistics
The Hong Kong Connectivity
Hong Kong – the international platform for:
Hong Kong – the marketplace for goods and services
The Hong Kong Connectivity
• Close to 100 international trade fairs a year
• Eight of them going for world No. 1
• Over 250,000 out of town buyers in 2005 (only TDC’s trade fair), half of them from Chinese mainland
• Close to 100 international trade fairs a year
• Eight of them going for world No. 1
• Over 250,000 out of town buyers in 2005 (only TDC’s trade fair), half of them from Chinese mainland
Hong Kong – the unrivalled platform for China business
The Hong Kong Connectivity
• First-mover advantage
• 50% FDI came from/through HK into China
• Experiences and business connections
• Risk management
• First-mover advantage
• 50% FDI came from/through HK into China
• Experiences and business connections
• Risk management
Mainland Private Enterprises – an added reason for foreign businesses to come to Hong Kong
The Hong Kong Connectivity
• 4 million MPEs and growing.
• 30% growth in their number p.a. – compounded over last 10 years
• Hong Kong is their platform under the “going out” policy
• 4 million MPEs and growing.
• 30% growth in their number p.a. – compounded over last 10 years
• Hong Kong is their platform under the “going out” policy
Hong Kong = Location, location, location
The Hong Kong Connectivity
• At the heart of Asia
• Three-hour flight to key mainland cities
• Air routes connect with 150 world cities + 45 cities in mainland
• At the heart of Asia
• Three-hour flight to key mainland cities
• Air routes connect with 150 world cities + 45 cities in mainland
Hong Kong – the ideal regional base
The Hong Kong Connectivity
• About 6,300 international businesses have set up offices in HK, up 5.5% in 2005
• Of these, 3,800 are regional headquarters or regional offices
• Number of Italian companies – 300 (53 are RHQs or ROs)
• All adopting the “Hong Kong Business Model” !
• About 6,300 international businesses have set up offices in HK, up 5.5% in 2005
• Of these, 3,800 are regional headquarters or regional offices
• Number of Italian companies – 300 (53 are RHQs or ROs)
• All adopting the “Hong Kong Business Model” !
The Hong Kong Connectivity
The Hong Kong Business Model
• Low cost and effective
• High value-added processes maintained in Hong Kong
• Other processes moved into the mainland
• 60,000 Hong Kong-controlled factories in the PRD
• Low cost and effective
• High value-added processes maintained in Hong Kong
• Other processes moved into the mainland
• 60,000 Hong Kong-controlled factories in the PRD
A tale of three cities:
Hong Kong + Shenzhen + Dongguan
III. A tale of three cities – HK Plus
= A regional economic powerhouse
= The best entry point to China's markets
= Combined consumer market of 25 million people
= A regional economic powerhouse
= The best entry point to China's markets
= Combined consumer market of 25 million people
China’s innovation & technology centre
New “Silicon Valley” – IT + R&D
Manufacturing base
China’s innovation & technology centre
New “Silicon Valley” – IT + R&D
Manufacturing base
A tale of three cities – HK Plus
Shenzhen
Dongguan
Quality and competitive production base
Clusters of all kinds of manufacturing
Ample supply of low cost labour
Quality and competitive production base
Clusters of all kinds of manufacturing
Ample supply of low cost labour
A tale of three cities – HK Plus
Average real GDP growth, 2000 - 2004
Compared with
Shanghai 11.5%
Compared with
Shanghai 11.5%
Shenzhen 15.8%
Dongguan 18.7%
Shenzhen 15.8%
Dongguan 18.7%
A tale of three cities – HK Plus
GDP per capita 2004 (US$)
Shenzhen 7,160
Dongguan 8,698
Shenzhen 7,160
Dongguan 8,698
A tale of three cities – HK Plus
Compared with
Shanghai 6,682
Compared with
Shanghai 6,682
PRD's Export Strength
Compared with
Shanghai 73.5
Compared with
Shanghai 73.5
US$ billion (2004)
Shenzhen 77.8Dongguan 35.2
US$ billion (2004)
Shenzhen 77.8Dongguan 35.2
A tale of three cities – HK Plus
• "Wait-and-see" no longer a viable strategy
• Now is the opportune moment
• China’s markets will be further open under WTO commitments
• Your competitors are going, what about you?
• "Wait-and-see" no longer a viable strategy
• Now is the opportune moment
• China’s markets will be further open under WTO commitments
• Your competitors are going, what about you?
Hong Kong
PRDPRD
IV. Time for Action!
• HKTDC is the conduit
• We match-make businesses the world over, specially SMEs
• HKTDC is the conduit
• We match-make businesses the world over, specially SMEs
Time for Action!
Time for Action!
• Find business partners
• Participate in 20 international trade fairs
• Log onto tdctrade.com
• Find business partners
• Participate in 20 international trade fairs
• Log onto tdctrade.com
HKTDC Services
HKTDC Credo :
“Anyone using the Hong Kong platform ~ is our client”
We are at your service !
“Anyone using the Hong Kong platform ~ is our client”
We are at your service !
Via Orefici, 2, 20123 Milan, Italy
Tel 39-(02)-865405
Fax 39-(02)-860304
Email: [email protected]
Via Orefici, 2, 20123 Milan, Italy
Tel 39-(02)-865405
Fax 39-(02)-860304
Email: [email protected]
Contact us at our Milan Office :
Thank You!Thank You!