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1.
GENERAL
The Governor, Sir Murray MacLehose, said at the annual dinner party of the General Chamber of Commerce on December 17, 1980 that increased investment in Hong Kong by China-based companies would carry Hong Kong through the economic recession.
He expected that relations between Hong Kong and China would continue to grow and said increased investment in Hong Kong by China-based companies would be welcomed.
2.
It was reported on January 22, 1981 that following China's adoption of an open policy in foreign trade, more and more Chinese provincial and local companies have set up offices in Hong Kong. In November 1980, the China Building Development Company Limited was set up and registered here as an independent firm. At the end of December, the Techscien Engineering Company Limited was established. Most recently, the Guangdong Enterprises Limited, sole agents of all Guangdong economic organisations in Hong Kong, was officially opened.
3.
A special programme titled "China Investment" in RTHK's "The Common Sense" was broadcast on March 8, 1981. People in charge of the Bank of China, China Resources and Kiu Kwong Development were interviewed and it was said that China's investment in Hong Kong was increasing and that this would boost overseas investors' confidence in Hong Kong.
At present, Hong Kong has become China's main outlet for its exports and re- exports. According to sources, statistics for 1980 showed that the total value of meat, vegetables, garments, textile products and other consumer products imported from China was $22 000 million. China gained HK$20 000 million in foreign currencies for the whole year through Hong Kong. This represented only earnings from the visible trade. Earnings from the invisible trade could not be estimated.
Earnings from the invisible trade came mainly from the massive investment by Hong Kong branches of firms in China in various trades and industries of Hong Kong.
A spokesman for the Bank of China said the Chinese Government had ordered that firms representing China could invest in any profitable trade in Hong Kong.
A spokesman for China Resources Company and Kiu Kwong Development disclosed that China's plans for investment in Hong Kong included land investments, a cement factory, a tin-making factory and general trade.
At present, firms representing China in Hong Kong invest heavily in land developments and they co-operate with other consortia to develop Tin Shui Wai in Yuen Long, the Lu Yang Sun Tsuen () residential development project above the Tsuen Wan Mass Transit Railway station, the high-class residential complex above Sha Tin's Kowloon-Canton Railway depot and other commercial projects.
Business dealings of the 13 Chinese banks are wide-ranging. The Bank of China in Hong Kong has received orders from China to expand its business. The bank started using computers two years ago, and these were jointly operated with the other 12 Chinese banks here. Up to the present, apart from expanding its financial services, the bank has taken a step forward in participating in international loan activities.
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Basically, industrial investments are slower in yielding returns for capital and interest. In a bid to absorbing advanced technology, China co-operated with other
consortia to develop a cement factory by investing HK$1 200 million, the largest investment made in local industry from overseas so far.
Coal ashes are used to produce cement. At present, the two power companies are buying coal from China to generate electricity and coal ashes are used by the cement factory for the production of cement, thus making full use of the raw material.
China's representative firms in Hong Kong set up a tin-making factory in the
Tai Po Industrial Estate to aid production of tinned food.
In addition, China invests heavily in Hong Kong's manufacturing and storage industries, shopping services and the manufacture of oil products through these organi- sations.
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3
COMMERCE
1.
China Corporation of Shipbuilding Industry
In March, 1980 the company (2) signed a joint
中國船舶工業公
venture agreement with Hong Kong's World-Wide Shipping Group (W)
and the China National Ship Chartering Corporation to form the International United Shipping and Investment Company Limited.
The new company has a paid up capital of $250 million, with the Chinese companies contributing 45 per cent and the World-Wide Shipping Group 55 per cent of the capital.
The company would concern itself with the purchase, acquisition, sale and management of all types of ships and shipboard equipment, dealing in the shipping business and investment management and all other shipping-related business.
It would have offices in Hong Kong and Bermuda.
(See also SEA LINKS-2E in CNR No. 32)
2.
Guangdong Shipbuilding Company
It was reported on December 28, 1980 that Guangdong Shipbuilding Company (###) had signed an agreement with Wah Cheong International Group
#AK) to form a joint venture company called the Wah Cheong International Vessel Company Limited (華昌國際船舶有限公司) to handle its business in Hong Kong and overseas.
Contributions towards capital investment by the two partners is on a 50-50 basis. The joint venture agreement was for three years, subject to renewal.
(See also SEA LINKS-2C in CNR No. 32)
3.
Bank of China
China Resources
It was reported on April 25, 1980 that a joint venture agreement among the Bank of China, the First National Bank of Chicago, the Industrial Bank of Japan and China Resources was reached.
The paid-up capital of the new venture was $10 million, of which China Resources would hold a 10 per cent stake and the others 30 per cent each.
The new company, known as the CCIC Finance Limited, was aimed at promoting commerce and investment in the Pacific basin and the shareholders' countries.
The company was planning to participate in loan syndicates, underwrite and deal in stocks and bonds, finance trade and issue letters of credit, make equity investment, engage in foreign exchange and money market transactions, and provide financial advisory and consultancy services.
CCIC Finance Limited was the first joint venture among China, Japan and the United States.
4. Guangdong Enterprises Limited
The Guangdong Enterprises Limited (RA), sole agents in Hong Kong for various economic organisations in Guangdong, was officially set up on January 6, 1981.
Speaking at the opening ceremony, a vice-governor of Guangdong, Mr. Zeng Dingshi, said the company would forge closer economic ties between Hong Kong and the province.
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