Hong Kong's economic success has and will continue to be built upon doing business with the Mainland. As such, Hong Kong firms should look to expand their presence in the Pearl River Delta to drive their business and the SAR's economic growth forward, Secretary for Commerce, Industry and Technology Henry Tang said.
"For Hong Kong, the opportunities arising from an expanding Mainland economy are magnified because of the symbiotic economic relationship between our two economies," he told the audience at the Chamber's 9th Annual Hong Kong Business Summit on November 27.
With a population approaching 50 million and an overall GDP of US$258 billion, it is also a huge market for consumer goods and a destination for investment. Hong Kong, on the other hand, is a premier business and service centre, with well-developed clusters of bankers, lawyers, accountants and consultants.
"With the strength of the PRD in terms of its manufacturing power and the depth and breadth of its economic activities, Hong Kong and the PRD together represent a total solution for overseas companies hungering for a taste of the Mainland market. This is an area of our strength that we should promote to the world," he said. "So, in attracting foreign investment, we should look at Hong Kong and the PRD as a whole."
This September, InvestHK joined with the Bureau of Foreign Trade and Economic Co-operation of Guangzhou Municipality to hold the first-ever joint promotional investment seminar in Tokyo. InvestHK will continue to organise joint promotions with Guangdong authorities to promote the Hong Kong/PRD region as the preferred business platform for overseas investors, with Hong Kong as the preferred service centre, Mr Tang said.
Despite a positive medium- and long-term outlook, Hong Kong first has to get over its short-term problems, he said. As an open and externally-oriented economy, Hong Kong tends to catch colds from the performance of its trading partners and the world economy. The current heavy deflationary pressure and the economic restructuring has lifted unemployment. The SAR's economic woes have affected the confidence of Hong Kong people, and presented challenges to the business sector.
To overcome the difficulties, Hong Kong must continue to further strengthen its economic ties with the Pearl River Delta. Mr Tang said he is trying to accomplish this through building partnerships with the PRD in attracting foreign investment, providing support to Hong Kong businesses in the PRD, and the proposed Closer Economic Partnership Arrangement (CEPA).
"China's accession to the WTO presents tremendous, and I dare say, once-in-a-lifetime opportunities for us. Our businessmen are in an unparalleled position to capture them but the government must also do our part to facilitate them," he said.
Given Hong Kong's strong fundamentals and its undiminished, historic role as the gateway to China, Mr Tang said the territory's crisis of confidence was unjustified. Other economies in the region are envious of the SAR's position, so Hong Kong needs to keep focus of its many advantages.
"We are a major player in the international business scene. We are the world's 10th largest trading economy... both our port and our airport are the busiest in the world in terms of international cargo throughput. We are also the second largest exporter of services in Asia after Japan ... not bad for 6.8 million people.
"Our competitive advantages lie in our ability to integrate our knowledge of the market needs, our understanding of the global trends and also our ability to make the best use of the most cost-effective technologies. Our proximity to the vast manufacturing base in the Pearl River Delta enables quick response to market demand and quick time-to-market. All this helps maintain Hong Kong's position as the world's major exporter of toys, textiles, clothing and footwear, watches and clocks, and jewellery. We want, and we must, capitalise on innovation and technology to upgrade our industries, enhance our competitiveness and create business opportunities," he concluded.