In the 2010-11 Budget, the Financial Secretary of the Hong Kong Special Administrative Region Government announced a wide range of initiatives with a view to consolidating the economic recovery, developing the economy and building a caring society. On the economic front, measures are introduced to ensure a stable and healthy development of the property market, develop the four pillar industries, promote the six new economic areas, and enhance regional integration. A relief package worth roughly HK$20 billion was announced to help support the recovery and relieve the burden of the community.
The economy improved further and resumed year-on-year growth of 2.6% in the fourth quarter, led by strong domestic demand and improving external sector. For 2009 as a whole, GDP fell by 2.7%. The outlook for 2010 is cautiously optimistic. GDP is forecast to grow by 4% to 5% in 2010, with headline and underlying consumer price inflation forecast at 2.3% and 1.5% respectively.
The economy continued to recover on entering 2010. Merchandise exports rose notably further in January by 18.4% in value terms over a year earlier, while headline inflation remained modest at 1.0%.
Hong Kong and the Mainland recently signed a co-operation agreement on customs facilitation measures for wine entering the Mainland market through Hong Kong.
Hong Kong’s Financial Secretary, Mr John C Tsang, the Secretary for Commerce and Economic Development, Mrs Rita Lau, and the Permanent Secretary for Commerce and Economic Development (Commerce, Industry and Tourism), Miss Yvonne Choi, witnessed the signing of the co-operation agreement by the Commissioner of Customs and Excise, Mr Richard Yuen, and the Vice Minister of the General Administration of Customs, Mr Sun Yibiao.
Speaking at the signing ceremony, Mrs Rita Lau said that against the backdrop of growing demand for wine on the Mainland, Hong Kong’s zero wine duty policy and favourable business environment helped create room for wine traders in the territory to tap the Mainland market. She also made reference to the large number of Mainland tourists visiting the city, who might buy in Hong Kong fine wines from different parts of the world.
She said that the signing of the agreement would enhance co-operation between the Hong Kong and Mainland Customs on wine-related matters, and fortify Hong Kong’s position as a regional wine trading and distribution hub. Continue reading ‘Hong Kong and Mainland sign agreement on customs facilitation measures for wine’
Invest Hong Kong, department of the Hong Kong Special Administrative Region (HKSAR) Government responsible for Foreign Direct Investment, supporting overseas, Mainland and Taiwanese businesses to set up and expand in Hong Kong, announced that the department assisted 265 overseas, Mainland and Taiwanese companies in setting up or expanding their business presence in Hong Kong in 2009. This achievement marked a record for the Hong Kong Government’s investment promotion arm in attracting Foreign Direct Investment (FDI) into the city. It also signified external investors’ strong vote of confidence in Hong Kong despite the challenging global economic environment.
Director-General of Investment Promotion at Invest Hong Kong, Mr Simon Galpin, said, “In the face of the global economic downturn, 2009 was a challenging year for Invest Hong Kong. The positive investment promotion results last year demonstrate that Hong Kong remains the base in Asia from which overseas, Mainland and Taiwanese companies prefer to expand their business.
“In these times of economic uncertainty, the enduring advantages of Hong Kong such as its rule of law, low and simple taxes, level playing field, free economy, world-class communications and transportation infrastructure, and available talent pool, have become increasingly important. They continue to enable the city to act as a stable and secure platform for companies looking to do business in the region and beyond,” Mr Galpin said.
Highlights of 2009
In total, the 265 companies that Invest Hong Kong helped last year planned to create more than 6,000 new jobs within the first two years of their operation or expansion in Hong Kong. Continue reading ‘Invest Hong Kong sets record in 2009 for completed investment projects’
Co-organized by Hong Kong Exchanges and Clearing Limited, Hong Kong Trade Development Council, Hong Kong Economic and Trade Office and Invest Hong Kong, a morning seminar on “Listing and Capital Raising in Hong Kong for Mineral and Natural Resources Companies” will be held March 8 at the Metro Toronto Convention Centre (Room 717B, South Building).
For mining and natural resources companies planning to raise funds, this seminar will provide them with an opportunity to better informed of Hong Kong’s securities market – one of the most active and liquid markets in the world. In 2009, US$31 billion was raised through new listings in Hong Kong, which was the top global IPO fund raising centre for the year.
Special guest speakers at the seminar include: Prof K.C. Chan, Secretary for Financial Services and the Treasury of the Government of Hong Kong Special Administrative Region, and Ronald Arculli, Chairman of HKEx.
Senior executives of HKEx and intermediary firm representatives and advisors will also be present to offer complimentary advice and insights on “Why and how mining companies can list in Hong Kong” including such practical subjects as “Preparing for IPO in Hong Kong: the process and common issues” and “How mining companies can attract investors in Asia through listing in Hong Kong”. On experience-sharing, the President & CEO of SouthGobi Energy Resources, Alexander Molyneux, will discuss with the audience the “Benefits of dual listing on HKEx”.
Pre-registration is required. For event details, please contact Andrew Yui, HKTDC Toronto Office at email: andrew.yui@hktdc.org or Tel: (416) 366-3594
Russian aluminum company Rusal has raised US$2.24 billion (HK$17.4 billion) from its initial public offering (IPO) in Hong Kong, making it the first Russian company to list in the city. It is not only the largest new listing in Hong Kong by an issuer from outside Greater China, but also the largest IPO globally year-to-date.
The Rusal offering was priced at HK$10.80 per share, which was the mid-point of the original price range, but the bottom of the slightly tighter guidance range of HK$10.80 to HK$12 that the bookrunners went out with towards the end of the bookbuilding. It was reported that more than 350 institutional investors had came into the deal, which was more than two times covered.
Meanwhile, Mongolia-based coal miner SouthGobi Energy Resources has also raised HK$2.89 billion (US$373 million) from a separate share sale that was very well received. While SouthGobi has all its mining operations in Mongolia, the company is Canadian and it is already listed in Toronto. The Hong Kong stock exchange has worked hard in recent years to broaden the line-up of new listings beyond companies from Greater China.
This year February 14th is not only Valentine’s Day, but also marks the beginning of the Chinese New Year or Spring Festival as it is sometimes called. As with the Chinese calendar, the new year coincides with the first day of their first lunar month and according to it, 2010 is the year 4707.
Parades and festivals will be on the top of every one’s list, but it is also a time for traditions and customs. According to our friends over at the Hong Kong Tourism Board, flowers are a mainstay for looking ahead and encouraging good tidings for the next 12 months. Narcissus and peonies signify prosperity, kumquats in offices point to success in business, plum blossoms encourage romance, and tangerines strengthen marital bliss. Purchasing new clothes and shoes are also encouraged to bring on new starts. The color red will also be ubiquitous as it is believed to be lucky in the Chinese culture. To find out what 4707 has in store for you, visit the HK Tourism Board’s website to see your horoscope.
The official Chinese New Year falls on February 14, 2010 while festivities have been taking place leading up to the New Year, and more will come. Here in Toronto, the Hong Kong Canada Business Association holds its New Year’s ball on February 20.
Your Chinese horoscope can provide insight for your personal and professional lives. In an article on their website, The Mandarin School provides some advice:
“The emerging industries in 2010 are related to earth (think real estate), fire (think energy, communications and entertainment) and metal (think automotive industry).”
To learn more about the Chinese New Year and how it can affect your business, read this column from The Mandarin School.
Photo by yewenyi.
The World Bank revised upwards its forecast on the global economic growth for 2010 to 2.7% from the 2% announced in June 2009, but the World Bank also warned that the global economic recovery may lose momentum in the second half of 2010 given that the impact of fiscal stimulus wanes, credit conditions remains tight and high unemployment persists.
In Hong Kong, seasonally adjusted unemployment rate came down further to 4.9% in October-December 2009. Sentiments among the large private businesses also improved further, with general optimism across all sectors surveyed as indicated by the latest Quarterly Business Tendency Survey. Meanwhile, Hong Kong was named the world’s freest economy for the 16th consecutive year by the Heritage Foundation.
In Asia-Pacific, Singapore’s non-oil domestic exports jumped for the second straight month in December, by 26% over a year earlier, amid rising global demand for its electronic and pharmaceutical output. Thanks to the strong Chinese demand, the value of Taiwan’s export orders surged by a record 52.6% year-on-year in December 2009.
A report in the Ottawa Citizen said Canada steel fabricator Canam Group is strengthening its ties with Asia. The company, based in the Beauce town of St. Georges, Quebec, said recently its Technyx division has bought the assets and trademark of InteliBuild Ltd. of Hong Kong. InteliBuild is best known for its consulting services in Asia, China and the Middle East. The new company formed from the acquisition will operate as InteliBuild Technyx Asia, a joint venture in which Canam will hold a majority stake. Canam, a major producer of steel joists and other building products, did not disclose the cost of the acquisition.
For the first time since 1975, Canada posted an annual trade deficit in 2009 as imports grew at a greater rate than exports. Commentary on the implications of this news are mixed.
CBC’s Michael Hlinka said in his broadcast this morning that it is a sign of a whole different environment for doing business. In the past, Canadian exports were protected by a weaker Canadian dollar, giving our companies a competitive edge. Hlinka argues that Canadian companies need to adapt to a new world where our dollar is almost at par with the American dollar. They’ll have to find other ways to be competitive.
In the Montreal Gazette, an article argues that the growing trade deficit is a good thing since it shows that the right policy decisions were made to cushion Canada from a global recession.
And in the Toronto Star today, some promising facts that show our exports grew in December when compared to November, and that automotive products supplied much of that growth.
At the same time, the Ontario Chamber of Commerce has been trying to help small and medium sized companies in Ontario seize global opportunities for exports. Through our Export Market Access program, we provide cost-sharing grants that cut a company’s costs of reaching new markets by half! Support from the federal and provincial governments has enabled us to support over 220 companies since the launch of the program and we are eager to assist many more.
One thing is certain, as the global economy recovers, Ontario companies must be ready to seize opportunities overseas. For too long we have been reliant on the United States market – an important market to be sure, but not the only one. Canadians and our products are well regarded around the world. Countries like China and India are growing at much greater rates, fueled in part by the growing middle class in these countries. Ontario companies have excellent products and quality services that could be better marketed to the world. It’s time we more aggressively pursued these opportunities.
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