HONG KONG Turning China into Opportunity Steve Alexander Deputy Executive Director, HKTDC

China Opportunity All eyes are on China! Massive market Beijing Hong Kong Shanghai 1.3 billion population 2,000 km

China Opportunity Companies are concerned about Making money… getting paid! Mitigating business risk Sourcing and keeping quality people

Turning China into Opportunity Hong Kong Advantages Turning China into Opportunity Vibrant Economy Dynamic People Ideal Location

Vibrant Economy China’s two-way trade platform Hong Kong Advantages Vibrant Economy China’s two-way trade platform ~ “One Country, Two Systems” Legal system based on common law International financial centre Infrastructure, shipping and logistics

Dynamic People The Chinese city that speaks your language! Hong Kong Advantages Dynamic People The Chinese city that speaks your language! Generations of entrepreneurial spirit Unrivalled experience in the Chinese market Bullet point 2: 100+ years of China experience, first to move into China after “opening-up” in 1978 BP 3: 500,000 expatriates Diverse workforce with international background

Dynamic People Creative, Innovative, Trendsetting Hong Kong Advantages Hong Kong is the lifestyle trendsetter of Asia At the forefront of innovation in Movies, Design, and Fashion HK movies – one of the largest and most dynamic film entertainment industries, outside of the US Hong Kong designers are renowned for their excellence both internationally and in China’s leading cities – Products bearing the Hong Kong brand are valued for their style, quality and creativity. Fashion – HK is one of the world’s key suppliers of clothing and clothing accessories; HK Fashion Week is the largest fashion event of its kind in Asia

Hong Kong’s Advantages Ideal Location Beijing Seoul Osaka Tokyo Changchun Harbin Shenyang Dalian Tianjin Nanjing Fukuoka Shanghai Hangzhou Nanchang Fuzhou Guangzhou Taipei Jinan Shijiazhuang Taiyuan Zhengzhou Xian Hefei Wuhan Chengdu Chongqing Changsha Guiyang Kunming Gulin Haikou Manila Ho Chi Minh City Bangkok Hanoi Kuala Lumpur Singapore Jakarta Dhaka Delhi Chennai Mumbai Bangalore Colombe All of Asia’s key markets within Hong Kong from half the world’s population 4 hours 5 hours

Ideal Location China’s dynamic south Hong Kong Advantages BEIJING SHANGHAI To do successful business in China, need to realise it is not just one market, but a series of regional markets 3 key regions: Bohai region (Beijing) Yangtse River Delta region (Shanghai) Pearl River Delta region (Hong Kong + part of Guangdong province) HONGKONG

Ideal Location Massive impact: 40 million people Hong Kong Advantages Ideal Location Massive impact: 40 million people 1/3 of China’s imports/ exports 16% annual GDP growth Pearl River Delta is the most important region in terms of manufacturing and export strength: With 40 million people, responsible for 1/3 China’s imports and exports, and 16% annual growth (compared to 12% YRD, 12% Bohai) Home to China’s wealthiest consumers and highest spenders Quality manufacturing at low costs Double digit GDP growth Excellent IT and R&D facilities 70,000 HK companies operating in the Pearl River delta employing 10 million people HONGKONG

Ideal Location Looking forward: A dynamic logistics hub Hong Kong Advantages Ideal Location Looking forward: A dynamic logistics hub Guangzhou Dongguan Shenzhen Foshan Shunde Zhongshan Zhuhai Macau Nanshai HONG KONG Pearl River THE FUTURE HK – Macau Zhuhai bridge: Beyond 2005 – all roads lead to Hong Kong! Further market integration with new infrastructure projects such as HK Macau Zhuhai bridge: Brings the Western region closer to the Pearl River delta Shortens distance from HK to Macau and Zhuhai to 30km from 60km and journey time to under half an hour Linking the entire Pearl River Delta

…So what does this mean? Hong Kong Advantages Vibrant Economy Dynamic People Ideal Location …So what does this mean?

Your preferred entry point into the PRD What it means for you… Technology Marketplace Sourcing high-tech products What HK has to offer: International experience in tech market PRD Strong IP protection HK Low taxation rates Focus on SOURCING Financial expertise Your preferred entry point into the PRD Preferential treatment on goods under CEPA

What it means for you… Tailored business models Model A Producing in China for global markets Value Chain Strategic development Design Sales In Home Market Financing Research Transport IT Marketing Distribution In Hong Kong Sourcing QC Manufacturing Inventory Post Production In China If you decide to use Hong Kong as your platform, you can choose an unlimited number of flexible business models. Let me give you two examples. A company can organize strategic development, design, and eventually sales from their Home Market In China, they can do their sourcing, QC, Manufacturing, inventory and post production. Hong Kong adds value in many areas, including financing, research, transport, IT, marketing and distribution. By keeping certain functions in your own market, and service operations in HK, you have the ability to protect proprietary info and IP.

What it means for you… Tailored business models Model B Producing in China for China markets Value Chain In Home Market Strategic development In Hong Kong Financing Research QC IT Sales In China Sourcing Design Transport Manufacturing Inventory Post Production Marketing Distribution An increasing trend that we’re seeing is one of companies producing in China and selling into China, as China heads towards becoming the largest consumer market in the world. You may still carry out strategic development in your home market – for instance, using China for design, transport and also sales. Hong Kong adds value in financing, IT, QC and Research.

A statutory organisation established by Government mandate 40 years ago Mission is “to create opportunity for HK companies by promoting trade in goods and services – connecting the world’s SMEs through HK’s business platform.”

Providing Information Matching Business Partners HK Trade Development Council Creating opportunities in international trade Providing Information Matching Business Partners Connecting Customers Here’s HOW we do it...

Providing Information Hong Kong Trade Development Council Providing Information In person 12 offices in China, more than 40 worldwide Beijing Hong Kong Frankfurt London Tokyo New York Bangkok Global network We offer services in person Our teams are already in your market – and ready to help. Visit an office near you!

Providing Information Hong Kong Trade Development Council Providing Information Online International market intelligence Unrivalled China market information Award winning trade portal - “Best in Asia”

Providing Information Hong Kong Trade Development Council Providing Information Research publications Analysis on various topics and industries Excellent sources for developing business models TDC’s Research department published a series of publications offering in-depth insight and analysis on international markets and industries. They are aimed at providing Hong Kong companies with information about the latest business opportunities and industry trends. Upcoming titles include: “Guide to doing business in the US” “India – A Challenging market with enormous potential” The Future Position of HK as a regional distribution centre

Providing Information Hong Kong Trade Development Council Providing Information tdctrade.com express SME News Flash Hong Kong Trader tdctrade.com express Fully-customized weekly e-newsletter that allows selection of regional news and industry events in your interest areas SME News Flash Offers “breaking news” that may have significant implications to your business News include changes in trade regulations of Hong Kong’s major trading partners Hong Kong Trader Monthly e-newsletter features the latest developments in Hong Kong’s business environment Includes success stories of international companies in the region Subscribe now for free at www.tdctrade.com

Matching Business Partners Hong Kong Trade Development Council Matching Business Partners Identifying suitable partners Customised business matching In-person and Online In person (customised business matching)

Matching Business Partners Hong Kong Trade Development Council Matching Business Partners Connect with 100,000+ quality suppliers 600,000+ registered buyers, over half from Europe and the Americas http://sourcing.tdctrade.com Product Magazines: 14 titles a year from a variety of industries Worldwide circulation of 2 million annually

Connecting Customers Leading trade fairs in Asia Hong Kong Trade Development Council Connecting Customers Leading trade fairs in Asia TDC organises close to 30 international trade fairs per year Many are the largest of their kind in Asia – (toys, gifts & premium, watches & clocks, electronics, optical, fashion) Attracted over 245,000 overseas buyers in 2005, including almost 65,000 mainland buyers (20,000 buyers from US) Open to exhibitors from around the world

Connecting Customers www.worldsmeexpo.com 50,000+ visitors Hong Kong Trade Development Council Connecting Customers 50,000+ visitors 5,000+ mainland companies 80+ industry-specific seminars and workshops www.worldsmeexpo.com

to Business Opportunities HK Trade Development Council Services Spectrum HKTDC: Connecting you to Business Opportunities

Lore Buscher Frankfurt, Germany Office Tel: 069-95772-0 Fax: 069-95772-200 Email: frankfurt.office@tdc.org.hk www.tdctrade.com