CODE 18-77
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1
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REMARKS BY THE SENIOR BRITISH TRADE COMMISSIONER (HK) AT THE PEKING COMMERCIAL CONFERENCE 13 OCTOBER 1988
Reference
I'm delighted that Hong Kong is on the agenda. Let me say at the outset that I don't see the choice between tackling the' China market from Peking or Hong Kong as any sort of a contest. Companies will decide for themselves how to approach it and some will decide on Peking; some on Hong Kong; some will go for both or one after the other or somewhere else (Shanghai perhaps). Its a matter for their commercial judgement.
I think we should be encouraging companies to look at the market from every possible angle. Having made that clear I have to say British companies are doing well in Hong Kong. Last year, they placed a record £1bn worth of merchandise in or through the territory. About ten percent, by value, was re-exported to the PRC. If that ten percent is taken off the Hong Kong figure and added to British exports to China, the respective figures are:
£516m sold in the PRC £9001sold in Hong Kong
So Hong Kong is very important to British companies and becoming more important. In the last ten years it has climbed up the league table of our markets from No. 28 to No. 18.
Of course our performance in Hong Kong needs to be kept in perspective. The territory trades on a very large scale and Britain supplies only three percent of total imports. The PRC dominates the scene, supplying 30 percent of everything Hong Kong buys. Most of Hong Kong's other major suppliers, including Britain, have lost market share to China though all of us are selling more in an expanding market. And all of us are selling more through Hong Kong into the PRC.
The territory's economy is doing better than most. GDP is growing at 6-7pc, down on the 12pc of the last few years but still impressive. It continues to be a place of considerable business opportunity in its own right and as a trading post.
A
I'm pleased to say British companies are showing a lot more interest in Hong Kong. The larger groups remain active; our profile is being raised by more British stores opening; and many more smaller companies are entering the market for the first time. Its not a walk-over for them Hong Kong is very competitive - but many of them are bringing new ideas, new products and they are competing. They are landing impressive orders. The larger groups are doing quite well, especially in winning sub-contracts for larger projects. important attraction is, of course, that cash is available in Hong Kong. Also English is widely spoken and business procedures are much the same as in Britain.
An
Although politically, all eyes are on 1997, commercially Hong Kong is already consolidating its connections with the mainland. In fact the impetus is in both directions: Hong Kong manufacturers are expanding their facilities into Guangdong and PRC authorities are setting up more offices in Hong Kong, looking for business. Between one and two million people in Guangdong are on the payrolls of Hong Kong companies supplying the labour that is in short supply in Hong Kong. Its an arrangement of mutual benefit to Hong Kong and the PRC. Most of the new factories are on the eastern side of the Pearl river. As communications are improved and more power becomes available, there's no doubt
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