Riots don’t distance HK firms from Chinese mainland

By Xie Jun in Shanghai Source:Global Times Published: 2019/11/7 22:28:40

Ties get closer as entrepreneurs seek new fields for growth in Chinese mainland

A view of Hong Kong's exhibition area on Thursday during the 2nd China International Import Expo Photo: Yang Hui/GT

Graphics: GT

Hong Kong businesses are increasingly interested in tapping the market in the Chinese mainland, partly pressured by riots in the city that are pushing them to look for markets that are more stable, said a high-level official from Hong Kong at the 2nd China International Import Expo (CIIE).

Jacky Chung, regional director for eastern and central China for the Hong Kong Trade Development Council (HKTDC), said that the Chinese mainland market is evolving in a way that makes Hong Kong entrepreneurs feel more confident. 

"For example, some Hong Kong businesses had concerns over the issue of intellectual property rights (IPR) infringement in the Chinese mainland, but their worries have eased a lot as the mainland has stepped up the protection of IPR in recent years," Chung told the Global Times at the Hong Kong food section during the CIIE, which is being held in Shanghai from Tuesday to Sunday. 

Their need to bank on the mainland market is also increasing as Hong Kong's overseas trade is being hit by the China-US trade war, he said. 

"Hong Kong needs to explore some new overseas markets such as Europe and Southeast Asia, as orders from the US have decreased. The mainland market is important. We used to export and distribute products to the world, so why not export to the mainland market right now?" Chung said. 

According to data from the HKTDC, Hong Kong's total exports in the first three quarters stood at HK$2.93 trillion ($374.6 billion), down 4.6 percent year-on-year. Its total imports were HK$3.27 trillion in the same period, slumping 6.5 percent year-on-year.

Hong Kong enterprises' rising interest in the mainland market is reflected by their active participation in the CIIE. More than 200 Hong Kong-based enterprises have applied for a presence at this year's CIIE, up 40 percent compared with last year. They occupy a total exhibition area of 22,000 square meters, up 60 percent year-on-year. 

On Thursday, the Global Times saw that the Hong Kong food company exhibition section at CIIE was crowded with visitors tasting food samples and talking with representatives. 

Howard Wong, general manager at Hong Kong food company Kampery, said the response from the mainland clients at the CIIE is even stronger this year. "We really can get in touch with clients that we didn't manage to contact before, as the expo helps us to contact clients on a national basis, while some past exhibitions only helped us to get in touch with more 'local' clients like in southern China or eastern China," he told the Global Times, saying that his company hoped to push supply chain cooperation with mainland partners. 

According to him, the mainland's rising consumption power is propelling the company's business to rise at a fast speed, with the major beverage section seeing sales growth of more than 20 percent almost annually in the past several years. 

Hong Kong businesses' access into the mainland is growing at a time when the city is mired in months of riots. Chung said the situation is not distancing Hong Kong enterprises from mainland markets but rather pulling them closer, as the mainland offers a safer and more stable environment. 

But he stressed that despite the social unrest, Hong Kong's economy is still resilient.

Wong also said that he hoped the social environment in Hong Kong would be more stable. "For businessmen and/or people working for others, the most important thing is a stable society. 

Chinese President Xi Jinping met Hong Kong Chief Executive Carrie Lam in Shanghai on Tuesday, and he emphasized that ending violence and chaos and restoring order remains the most important task for Hong Kong at present. 

Lam also visited the exhibition zone of Hong Kong companies at the CIIE.

Song Lin also contributed to this story

Newspaper headline: Riots don’t distance HK firms


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