The recent drastic drop in the Shanghai and other stock exchanges worldwide did not cause panic in Hong Kong, where Georgia companies can find mainland Chinese companies that are increasingly investing there to meet Western partners, said Margaret Fong.
“Luckily, Hong Kong has a robust stock market, so the drop did not cause panic,” Ms. Fong, Hong Kong Commissioner in Washington, told GlobalAtlanta during her first visit to Atlanta for the Hong Kong Information Center’s 13th annual Chinese New Year celebration held at the Woodruff Arts Center on March 2.
Until the current upset, which Ms. Fong called an “expected adjustment,” the Hong Kong stock market has been “going through the roof,” she said. She noted that Hong Kong reported $42 billion in initial public offerings in 2006, surpassing the New York Stock Exchange with the second most IPOs in the world after London.
In this healthy economic environment, Ms. Fong said her Hong Kong Economic & Trade Office can help Georgia companies with regional headquarters in Hong Kong match up with Chinese partners there. She recommended Hong Kong as a “good place to link” up before the Chinese partner decides to invest in Georgia or the Georgia partner decides to invest in China.
“If you have a company branch in Hong Kong, you will have [Chinese firms] coming to you, knocking on your door, asking, ‘Is Georgia the place for me?’” she said.
Mainland Chinese companies in Hong Kong already have a taste of what business is like in a Western environment, and many mainland firms are in Hong Kong specifically to find international partners, Ms. Fong said.
Hong Kong is playing an important role in helping Chinese companies go international, she added, noting that Hong Kong attracts business expertise from around the world. Some 3,800 foreign companies have regional operations in Hong Kong, offering “the best pool of talent” when Chinese companies need partners to expand overseas.
Hong Kong’s business environment is transparent and is based on free trade, which are “elements that mainland companies will find useful in China’s liberalization road,” Ms. Fong said.
Georgia companies will find Hong Kong useful also, she said, adding that foreign companies have faith in the special administrative region’s rule of law system where contracts are honored, intellectual property is protected and companies have a history of dealing with international partners.
When Hong Kong was transitioning back to Chinese control in 1997 after 150 years of British rule, there was considerable concern over the preservation of civil freedoms, rule of law and open trading, said Ms. Fong, who, at the time, was working in Hong Kong’s constitutional affairs office that was overseeing the transition.
But the process went extremely smoothly, she said, noting that the British rule-built infrastructure remains integrated into Hong Kong’s international trading and economic systems.
In the 10 years since the transition, Hong Kong’s economy has grown robustly, said Ms. Fong, who began her current post July 31.
Following the Asian financial crisis in 1997-8 when Asian stock markets plunged, and the SARS health scare in 2003, Hong Kong has rebounded well, experiencing 25 percent cumulative gross domestic product growth in the past five years, she said.
Hong Kong “learned lessons the hard way” in the financial crisis, so for the past 10 years, it has been strengthening its regulatory regime in its financial markets, heralding this sector as its “main niche for the future,” Ms. Fong said.
Story Contacts, Links and Related Stories
Hong Kong Economic & Trade Office in Washington (202) 238-6336
Hong Kong Information Center: Gene Hanratty, senior consultant (404) 238-0875