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China was a land of opportunity for Canadian companies, and Hong Kong was the gateway to this emerging economic and industrial powerhouse, the head of Canada's largest trade and industry organisation said today (May 18, Toronto time).
In a keynote speech entitled "Hong Kong: Canada's Partner in Prosperity", President and CEO of the Canadian Manufacturers & Exporters Mr Perrin Beatty told the 170 political and business leaders at a Parliament Hill breakfast meeting in Ottawa that China and India were fuelling the "next-generation industrial revolution" and rewriting the rules of the game. "Simply put, business as usual is not an option," Mr Beatty said.
The power breakfast is an annual event in the Canadian capital presented by the Ottawa Section of the Hong Kong-Canada Business Association, with the support of the Hong Kong Economic & Trade Office (HKETO) in Canada.
Mr Beatty encouraged Canadian business people to make use of gateway position of Hong Kong, which advocated and practised free trade ©¤ a free and liberal investment regime, the absence of trade barriers, no discrimination against overseas investors, freedom of capital movement, well-established rule of law, transparent regulations, and low and predictable taxation.
The former federal minister recalled his impressions after his first visit to Hong Kong ¡ª "millions of people living in an area not much larger than my constituency whose only resources were geography and ingenuity, but who had become world leaders in a wide range of areas."
"It left me feeling that if Canadians could combine the advantages that come from our natural bounty and diverse population with the creativity and work ethic that typify Hong Kong the result would be a world-beater," he said.
Mr Beatty pointed out that there were 250,000 Canadians living and working in Hong Kong, and more than 150 Canadian companies operating there, ranging from Canada's big banks and insurance companies to locally incorporated service companies. Direct investment from Canada reached C$2.9 billion last year.
Hong Kong offers excellent commercial opportunities to Canadian firms. Last year, Canada exported almost C$2 billion in goods to Hong Kong, making it Canada's 14th largest export destination for goods. Hong Kong companies have cumulative investments in Canada of C$5 billion.
Mr Beatty said China's nine per cent per annum compounding growth over the last two decades already had a profound effect on Hong Kong, "where people now talk, not about goods being 'Made in Hong Kong', but being 'Made for Hong Kong'. While the actual production of goods may be taking place across the border in the Pearl River Delta or beyond, Hong Kong manufacturers have focused on high value-added elements of their business, such as design, distribution, promotion, sales, financing, service and brand management."
The new opportunity in China has also spawned a host of new challenges, according to Mr Beatty. "But with a population of more than 1.3 billion, the Asian giant represents a potentially colossal market for Canadian companies."
China is fast becoming the world's manufacturing and exporting giant. China's Gross Domestic Product now exceeds US$1.3 trillion ¡ª about 40% more than Canada¡¯s. China's exports are now eight times larger than they were only 10 years ago. The country is now Canada's third largest trading partner and Canada is China's 10th. Total two-way trade totalled over $8 billion last year - 50 times higher than it was in 1970.
"China is a land of opportunity for Canadian companies and Hong Kong is positioned as the gateway to emerging economic powerhouse. We speak the same language, have a better appreciation for the Western-influenced culture and share similar values," he said, adding that those who once saw China's growth as a threat, now saw it as the key to their prosperity. "We must look at globalisation and international competition as an opportunity to make ourselves stronger."
Mr Beatty said the World Trade Organisation provided the cornerstone of Canada's trade policy and the foundation for Canada's relations with its trading partners, including emerging markets and developing countries. "And, in this uncertain and tumultuous economic era, we must enhance our relationship with Hong Kong. For well over a century, Hong Kong has served as the gateway to Mainland China. Obviously, there is nowhere better to obtain the expertise, information and facilities needed to tap in to the Chinese market, especially as economic expansion is fuelled through trade due to its entry in the WTO."
The Director of the HKETO, Mr Bassanio So, also added that Hong Kong was now playing a role as Canada's beachhead in China. He said Hong Kong benefited from riding on the intense China wave ¡ªthat Hong Kong was not only the biggest investor in China but also the largest recipient of China's foreign direct investment. "We are the window through which Chinese companies invest in or do business with foreign countries," he said.
Last year's parliamentary breakfast was attended by some 100 people. The increase of participants for this year indicated a growing interest among Canadian companies in doing business with Asia, particularly, Hong Kong and China, according to Mr So.
Ends/Friday, May 19, 2006
Issued at HKT 10:43
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