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Citing Hong Kong's strengths as an international air, sea and logistics hub, Hong Kong Commissioner for Economic and Trade Affairs, USA, Mr Donald Tong, said that Hong Kong was the natural choice for US and Tennessee companies to access the growing Mainland and Asian markets.
As the 18th largest market for Tennessee exports, Hong Kong imported US$333 million worth of goods from Tennessee in 2010, an increase of 15% over 2009. Major imports were chemical products, computers and electronics. A number of Tennessee companies such as Fedex, International Paper and Eastman Chemical have offices in Hong Kong.
Speaking at The Traffic Club of Memphis business luncheon today (April 19, Tennessee time), Mr Tong said the Hong Kong Special Administrative Region Government was committed to enhancing the city's position as the preferred regional logistics hub - providing critical infrastructure to enhance connectivity all along the supply chain.
Tennessee firms incorporated in Hong Kong can also enjoy the full benefits of the Closer Economic Partnership Arrangement (CEPA). In addition, goods of Hong Kong origin can enjoy tariff-tree entry into the Mainland market.
He noted that under CEPA, freight forwarding agencies set up by Hong Kong companies in the Mainland could open branches once they had fully injected the registered capital. Other foreign companies were only permitted to do so one year after they had set up the relevant Mainland enterprises. "One important element of CEPA is that it is nationality blind," he said.
Leading service suppliers such as DB Schenker, Yusen Air & Sea Service Company Ltd, NYK Group and K Line Logistics Ltd have leveraged on CEPA and set up wholly-owned transport and logistics operations in the Mainland.
He also pointed out new growth areas such as the medical, environmental and educational sectors, which provide ample opportunities for Tennessee entrepreneurs.
Highlighting Hong Kong's unique role as China's global financial centre, Mr Tong said that Hong Kong had recently witnessed spectacular growth in Renminbi (RMB) trade settlement, bond issue and banking services in a short span of time. Overseas companies, including US firms, have been able to settle trade with eligible Mainland companies using RMB since July 2009.
Mr Tong urged Tennessee businesses to consider leveraging Hong Kong's experience to settle Mainland trade in RMB with over 67 000 Mainland enterprises. "This would help Tennessee companies offset the risks of exchange rate fluctuations and give more certainty to business transactions," he said.
To maintain Hong Kong's competitiveness, Mr Tong told the guests that the 10th container terminal was being planned and a study was underway to look into meeting the draught requirements of the next generation of ultra-large container vessels.
On air services, "We are developing the midfield area between our two existing runways to meet the medium-term needs of the airport up to 2020," said Mr Tong. "Upon completion of the first phase in 2015, the annual handling capacity of the airport will reach 70 million passengers.
"We are also building a new air cargo terminal which will increase our handling throughput by 2.6 million tonnes a year. With its commissioning in early 2013, we expect further improvement in our cargo handling business in terms of costs, service and efficiency."
During his visit to Nashville on April 18, Mr Tong called on the Governor of Tennessee, Mr Bill Haslam; Mayor Karl Dean of the Metropolitan Government of Nashville and Davidson, and local business leaders. Mr Tong stopped at County Lipscomb University and Vanderbilt University, where he spoke to students on the strengths of and challenges for Hong Kong.
Ends/Wednesday, April 20, 2011
Issued at HKT 12:17
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