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CEPA Adds to HK's Charm for Luring Overseas Investment

Invest Hong Kong assisted 127 foreign and Chinese mainland companies in establishing or expanding operations in Hong Kong in the first half of this year and these projects have brought in more than 3.36 billion Hong Kong dollars (US$430 million) for Hong Kong.

 

According to Invest Hong Kong, about 20 percent of the newly-investing overseas companies claimed that the Chinese mainland/Hong Kong Closer Economic Partnership Arrangement (CEPA) was an important factor in their decision to invest in Hong Kong.

 

Hong Kong Chief Executive Tung Chee Hwa held a reception Monday afternoon to express the thanks of the Hong Kong Special Administrative Region government to the new investors at Government House.

 

He stressed that Hong Kong has become even more attractive after China entered the World Trade Organization in 2001 and the implementation CEPA at the beginning of this year.

 

CEPA opens up new and exciting opportunities for companies based in Hong Kong in the areas of trade in goods, trade in services, and trade and investment facilitation, Tung added.

 

"All of you certainly have played a part in Hong Kong's recovery," he said. "Our business sectors, including overseas investors, have once again demonstrated their skills, drive and resilience -- and ability to take advantage of opportunities. The companies here today have helped inward investment reach record levels during the past 18 months."

 

He said 2003 was Hong Kong's most successful year ever for investment promotion. Invest Hong Kong assisted 142 overseas and Chinese mainland companies to set up or expand operations in Hong Kong -- an increase of 21 percent compared with 2002.

 

These projects brought in more than 2.5 billion HK dollars and created over 2,450 jobs for the city. The target for 2004 is 200 completed projects, over 40 percent more than last year.

 

Tung believed that Hong Kong remains an unrivaled hub for doing business in Asia and the gateway to expand into the Chinese mainland market. Hong Kong had already registered more than 3,200 regional headquarters and regional offices by the end of June 2003,and the number is growing each year.

 

On average, one foreign-owned company is setting up one regional headquarters in Hong Kong every week.

 

Tung explained that one of Hong Kong's main attractions to international companies is as the gateway to the Chinese mainland and, particularly as part of the Pearl River Delta region. Hong Kong provides capital, management, technology, market knowledge and access to international markets while the Chinese mainland cities offer world-class low-cost manufacturing, and access to a new, demanding consumer base.

 

Just last month, he said, Hong Kong took another important stepby establishing the Pan-Pearl River Delta Regional Cooperation and Development Forum to work towards a unified and open market in the region.

 

"Through CEPA and promotion of Pan-Pearl River Delta regional cooperation, we are breaking down obstacles to trade, while attracting more foreign capital, technology, management and talent, to reinforce the status of this region as one of the most dynamic economic centers of China and the world in the 21st century."

 

Director-General of Investment Promotion at Invest Hong Kong Mike Rowse said "your presence here sends a strong message -- that Hong Kong is the premier business hub in the region."

 

He said the retail sector continues to be strong. The influx of the international brands to Hong Kong in the past few months shows that Hong Kong's reputation as a leading consumer market in Asia is only getting stronger.

 

Apart from retail sector, his department also noted strong interest from the business and professional services, IT and technology sectors.

 

John Rutherford, associate director-general of Invest Hong Kong, told Xinhua that about 16 percent of the new projects were invested by Chinese mainland companies, and Invest Hong Kong noted the increased interest from Chinese mainland companies in using Hong Kong as a springboard to overseas markets.

 

He listed a number of newly registered companies from the Chinese mainland from financial software giant -- "Ufsoft," Kingdee International Software Group, to electronic products retailer "Guomei" and famous chain restaurants as "Tanyutou," adding that the Chinese mainland companies would enter the international market via Hong Kong.

 

Lavin Mok, managing director of the US-headquartered Oppenheimer Funds (Asia) Limited, said the United States and China are two major drivers of the world economy. His company came to Hong Kong for catching greater opportunities, a gateway to the Chinese mainland.

 

With the smooth implementation of CEPA, he is confident that overseas investors could have more chances in both Hong Kong and the Chinese mainland.

 

(Xinhua News Agency July 13, 2004)

 

 

 

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