Slide1 : Consulate General of Canada, Hong Kong Presentation to
HKCBA Forum in Toronto
23 April, 2007
HONG KONG - A MACRO LOOK : HONG KONG - A MACRO LOOK 7 million population within 5 hours of half of the world’s population
GDP of US$ 189 billion in 2006 (up 6.8%)
91% of GDP is generated by services (40% by comparison in China)
Per capita GDP US$ 27,500 in 2006 (Canada US$ 38,757)
In 2007, HK will raise more $ by IPOs than London or New York
HONG KONG IS THE WORLD’S … : HONG KONG IS THE WORLD’S … 8th largest banking centre
2nd largest source of outward foreign direct investment (FDI) in Asia
Largest investor in every Province of China
2nd largest FDI recipient in Asia
2nd largest stock market in Asia (Tokyo #1)
HONG KONG: A GATEWAY TO CHINA AND ASIA : HONG KONG: A GATEWAY TO CHINA AND ASIA Rule of law, solid regulatory regime
Ranked as the world’s freest economy every year since 1970 (Fraser Institute, 2006)
Entrepreneurial energy
Effective civil service
Open and transparent purchasing practices
HONG KONG: A GATEWAY TO CHINA AND ASIA : HONG KONG: A GATEWAY TO CHINA AND ASIA Financial centre and IPO capital of Asia
Freedom of the press
Low tax rates (corporate profits tax - 17.5%)
Free flow of capital
Free movement of people
Skilled and highly productive workforce
HONG KONG - A REGIONAL CENTRE : HONG KONG - A REGIONAL CENTRE 6,354 overseas companies have operations in Hong Kong
1,228 are regional headquarters
2,617 are regional offices
2,509 are local offices
Twice as many insurers than Tokyo
25% more international banks than Tokyo Source: HKSAR government survey, 2006
HONG KONG - INFRASTRUCTURE : HONG KONG - INFRASTRUCTURE World’s busiest airport in terms of international cargo throughput
World’s 2nd busiest container port
One of the most open telecommunication markets in the world
One of the world’s highest penetration levels for mobile phones (120%)
Broadband to all commercial buildings and 90% of households
WiFi access to be installed in all government buildings and public areas
HONG KONG - TRADE : HONG KONG - TRADE Total exports US$315 billion in 2006 (up 9.4%)
Total imports US$333 billion in 2006 (up 11.6%)
Re-exports US$298.3 billion in 2006 (up 10%)
15th largest Canadian export market (CAD$1.59 billion in 2006)
HONG KONG - SMEs : HONG KONG - SMEs Easy to do business
Most Canadian clients are SMEs
1,755 Canadian companies interested in or selling to Hong Kong, mostly SMEs
Most Hong Kong partners are also SMEs
Great local interest in finding Canadian partners
HONG KONG AND CHINA : HONG KONG AND CHINA Leader in providing value-added financial and management services to China
Principal source of international equity funds for Chinese companies
Largest investor in every province and region of China
Hong Kong has 56,000 trading firms dealing with import and export from China, employing 477,000 in Hong Kong
HONG KONG AND CHINA (CONT.) : HONG KONG AND CHINA (CONT.) Hong Kong concerns own or control 80,000 factories employing 13 million people in China
Up to 12% of HK’s GDP derives from repatriated profits from operations in China
Closer Economic Partnership Arrangement (CEPA), a free trade agreement with China launched in 2003, offers many opportunities
Hong Kong is a preferred location for new to market SMEs to tackle the Chinese market
The city provides an excellent platform to demonstrate to Chinese buyers (e.g., Thales, Delcan)
HONG KONG AND PEARL RIVER DELTA : HONG KONG AND PEARL RIVER DELTA One of the most affluent and fastest growing regions in China
Population of 47 million within a 150 km radius of Hong Kong
Hong Kong enterprises have invested US$78.9 billion in Guangdong
Hong Kong work program integrated closely with Guangzhou
MACAO - A MACRO LOOK : MACAO - A MACRO LOOK Population: 513,400
GDP: US$15 billion (2006)
GDP per capita: US$ 29,168
GDP grew 16.6% (2006)
Massive increase in overseas investment since 2001
MACAO – MERCHANDISE TRADE : MACAO – MERCHANDISE TRADE Total Exports (2006) = US$ 2.62 billion
Total Imports (2006) = US$ 4.68 billion
Growing rapidly
MACAO – A BOOMING ECONOMY : MACAO – A BOOMING ECONOMY Gambling revenues amounted to US$ 7 billion in 2006, up 22% compared to last year
Overtaken Las Vegas as the world top casino hut
Growth fuelled by surge in tourist arrivals since travel restrictions were lowered in the Chinese mainland
US$ 25 billion committed to building some 20 new hotel-casino complexes over the next few years in anticipation of tourist arrivals in excess of 20 million
CANADA IN CHINA : CANADA IN CHINA
Slide17 : Beijing
Shanghai
Chongqing
Guangzhou
Hong Kong
PRIORITY SECTORS – HONG KONG : PRIORITY SECTORS – HONG KONG Information and Communication Technologies
Processed Food, Fish and Agricultural Products
Transportation
Energy/Environmental Equipment and Services
Life Sciences
Construction Products and Services
Canada: The Pacific Gateway : Canada: The Pacific Gateway
HONG KONG AND CANADA : HONG KONG AND CANADA 15 Canadian companies have regional headquarters in Hong Kong
29 Canadian companies have regional offices in Hong Kong
Over 150 Canadian companies have offices in Hong Kong, another 600 have representatives
The Canadian Chamber of Commerce is the largest outside Canada (over 1,000 Members)
HONG KONG AND CANADA : HONG KONG AND CANADA Over the past century almost one million people have immigrated to Canada from Hong Kong
250,000 Canadian Passport holders in Hong Kong
Consistently one of Canada’s top 15 trade partners
Hong Kong is Canada's 5th largest market for ICT products
INVESTMENT POTENTIAL : INVESTMENT POTENTIAL Cumulative investment from Hong Kong to Canada C$6.27 billion
Infrastructure investments
Some industrial investment potential
Venture capital for joint ventures in Asia
PARTNERING POTENTIAL : PARTNERING POTENTIAL Biotechnology, bio-pharma
Environmental technologies
ICT products
Auto parts
AGRICULTURE AND AGRI-FOOD MARKET SIZE : AGRICULTURE AND AGRI-FOOD MARKET SIZE In 2006, Canada’s Total Agri-Food Exports
(including seafood)
To Hong Kong $450 million
To Macao $24 million
AGRICULTURE AND AGRI-FOOD MARCO ENVIRONMENT : AGRICULTURE AND AGRI-FOOD MARCO ENVIRONMENT Hong Kong and Macao import most of their food requirements
A free market with transparent food laws
English food labels are accepted
An efficient and sophisticated food distribution system
Food importers have good international procurement experience
AGRICULTURE AND AGRI-FOOD MARKET TRENDS : AGRICULTURE AND AGRI-FOOD MARKET TRENDS HK traders controls trading of higher value items through provision of finance and trade expertise
Demands for safe, healthy, natural and organic food products
Demands for nutraceutical and health food products
A vibrant food services industry both in Hong Kong and Macao
AGRICULTURE AND AGRI-FOOD MARKET OPPORTUNITIES : AGRICULTURE AND AGRI-FOOD MARKET OPPORTUNITIES Healthy food products, e.g tea drinks, high calcium, high fibre, low cholesterol and Omega-3 enriched.
Wellness food products, e.g., transfat free, low glycemic index foods, and fresh fruit drinks.
Healthy snacks for school children.
Pre-packaged processed organic food products.
Low cost substitution food products
AUTO BUSINESS ENVIRONMENT : AUTO BUSINESS ENVIRONMENT A major and growing industry in South China…
One of Guangdong province’s “Pillar Industries” with three automotive industry bases in Guangzhou alone
Many local auto parts companies in PRD, Fujian
LiuZhou, Guangxi - another important South China auto sector base
AUTO CANADIAN SUCCESSES : AUTO CANADIAN SUCCESSES Magna in Foshan
Vannatter in Shenzhen
P&P in Guangzhou
AUTO WORKING WITH KEY PLAYERS AND PARTNERS : AUTO WORKING WITH KEY PLAYERS AND PARTNERS Local auto manufacturers: Golden Dragon (Fujian), Guangzhou Automobile
Major OEMs: e.g. Honda, Nissan, Toyota, Hyundai
Local government officials: Guangdong Science and Technology Department
Promotion Event: Auto Parts Guangzhou 2007
Slide32 : • Solid Waste Treatment Technologies and Equipment
• Water and Wastewater Treatment and Recycling Technologies
• Air Pollution Control Systems
• Odour Control Systems
• Green Building Design & Products
• Renewable Energy Technologies
• Landfill Gas Recovery Technologies
• Clinical Waste Management
• Energy Saving Systems
• Indoor Air Quality Products
Green Building Production & Technologies
Noise Control Equipment for construction site SUMMARY OF ENVIRONEMENT MARKET OPPORTUNITIES
Slide33 : Waste:
In 2006: about 6.4m tonnes MSW disposal of.
3 Strategy Landfills - to be filled in the next 6-8 years
Major Initiatives & Opportunities
1. Integrated Waste Facility under plan
2. Eco Park (C$45m)
3. Landfill Extension (C$1.2b)
4. Chemical Waste Treatment Facility Upgrade
5. Other Waste Programs ENVIRONEMENT
Slide34 : Water:
About 1.5m tonnes of sewage dumped untreated.
Major Initiatives & Opportunities
1. Harbour Area Treatment Scheme (HATS)
2. Total Water Management Policy
3. Pilot Desalination Plant
4. Replacement of Water Mains
5. Others ENVIRONEMENT
Slide35 : AIR:
Vehicle emission, power plant, regional air pollution
15,000 deaths a year linked to high particulate levels
Major Initiatives and Opportunities
Retrofitting heavy diesel vehicles with particulate removal device
Emission Cap on Power Plants (installation of FGD)
Use of alternative fuels (mainly wind, solar and biomass)
Possible implementation of Emission Trading Scheme with Guangdong.
Indoor Air Quality Program
Mandatory VOC registration and labelling under reviewed ENVIRONEMENT
Slide36 :
Examples of Canadian Environmental Technologies and Products in HK
Water and Wastewater Systems (UV systems)
Reverse Vending Machines for Bottle Recycling
Odour Control Systems
Air Purification Systems
Landfill Gas Recovery Systems
Toxic Gas Detection Systems
Total Degradable Plastic Additives
Remediation Services
Regional Air Consultancy Services ENVIRONEMENT
Slide37 : Significant river pollution (Class V or worse)
Low waste water treatment rate, limited processing capability
Urban and industry solid waste management, e.g.hazardous waste disposal
Severe air pollution ENVIRONMENT ENVIRONMENTAL CHALLENGES IN PRD
ENVIRONMENT CLEAN-UP PLAN : Guangdong plans to spend C$17 b on pollution abatement and ecological protection in 2006-2010, focusing on 6 priorities:
Regional waste water management and river pollution abatement
Desulphurization of coal fired power plants
Solid waste management, including hazardous waste and electronics waste treatment
Ecological protection and development
Radiation source and waste treatment
Environmental warning system and emergency response
ENVIRONMENT CLEAN-UP PLAN
Slide39 : ENVIRONMENT BUSINESS OPPORTUNITIES Public utilities such as : water, wastewater and solid waste , BOT/TOT
Air pollution management : FGD(Flue gas desulphurization) for coal fired power plants, environmentally friendly public transport
Green construction: energy efficient buildings
Environmental software, including environmental information system, environmental assessment, emergency response and training
Encourage clean /renewable energy development: natural gas, solar, wind, fuel cells etc
ENVIRONMENT CHALLENGES FOR CANADIAN EV COMPANIES :
ENVIRONMENT CHALLENGES FOR CANADIAN EV COMPANIES Mismatch between Canadian companies and Chinese environmental projects since most are enormous by Canadian standards
Growing demand for turnkey solutions, including financing and operating
Emphasis on integrated, customized solutions
Most Canadian companies are SMEs, focused on single-products or technologies
HONG KONG AS AN ICT MARKET : HONG KONG AS AN ICT MARKET What is new, innovative and in demand in Canada, should have a market in Hong Kong (e.g. Blackberry)
Most liberal telecom market in Asia
5 mobile operators (GSM, CDMA standards)
Mobile phone subscribers (>127%): the highest in Asia.
Four 3G Network operators (Hutchison “3”, CSL, SmarTone, PCCW/Sunday)
10 FTNS operators
Internet household users (63%)
Broadband penetration rate: 2nd highest in the world (ITU Study)
ICT CANADA – HONG KONG RELATIONS : ICT CANADA – HONG KONG RELATIONS
Number of MoUs signed between Hong Kong and Canada: 11
Examples:
Government to Government
Industry Canada ~ Hong Kong Information Technology & Broadcasting Bureau
Associations
The Canadian Wireless Telecommunication Association (CWTA)~ The Hong Kong Wireless Technology Industry Association (WTIA)
Institutions
Hong Kong Cyberport~Banff Centre
Slide43 : South China, (Guangdong, Guangxi, Hainan and Fujian), 180 million people
Guangdong, next door to HK, is the most active ICT market for Canadian companies
Guangdong is the largest telecom market in China (Fixed line, 36 million subscribers and mobile, 67 million) and #1 in China
Shenzhen is the home of the world class Chinese ICT companies, ie. Huawei, ZTE and TCL SOUTH CHINA AS AN ICT MARKET
ICT MARKET OPPORTUNITIES IN HK/ SOUTH CHINA : ICT MARKET OPPORTUNITIES IN HK/ SOUTH CHINA What’s hot HK S. China
Wireless technology (Wifi, 3G, 4G and WiMax) √ √
Wireless content and applications √ √
Digital Broadcasting Technologies √ √
Computer animation / New Media / e-Learning √ √
IT in Security (e.g. border control, anti-spam) √ √
eLogistics, (e.g. freight movement) √
e-Health √
e-Commerce (e.g. e-government, e-payment) √
Others (the 2010 Asian Games in Guangzhou)-S.I. √
WHAT DO HK / CHINESE PARTNERS NEED FROM YOU? : WHAT DO HK / CHINESE PARTNERS NEED FROM YOU? Best of Breed
Vendor Support
Recognized References (in Asia)
International “look & feel” / open standards
ROI of 12-18 months.
Good Profit Margins
SUCCESS STORIES IN ICT SECTOR : SUCCESS STORIES IN ICT SECTOR
UPCOMING ICT PROMOTION EVENTS : UPCOMING ICT PROMOTION EVENTS Hong Kong
ICT EXPO 2008, April 2008
China Sourcing Fair:
Electronics & Components, May 2008
South China
China Int’l Optoelectronic Expo, September 2007
China High-Tech Fair, October 2007
LIFE SCIENCES SECTOR OVERVIEW HK : LIFE SCIENCES SECTOR OVERVIEW HK
Increasing Demand including
Dietary supplements
Nutraceuticals
Pharmaceuticals
Medical products
Other key factors: threat of contagious diseases and viruses; aging population; government support; improvement in the local economy and public awareness on health issues.
Slide49 : Sub Sectors
Pharmaceutical
Medical and Healthcare Products
Health Supplements
Traditional Chinese Medicine.
Established Technology Infrastructure
Hong Kong Sciences Technology Park
HK Jockey Club Institute of Chinese Medicine
Universities and Teaching Hospitals
Enhancing Canada-HK Partnership LIFE SCIENCES SECTOR OVERVIEW HK
Slide50 : Summary of Business Opportunities
Pharmaceuticals
Products Registered: website: www.info.gov.hk/pharmser
# of Registered Products: 20,000 of Pharmaceuticals and 2,700 of Vitamins and Minerals)
Major Demand on cardiopulmonary disease, diabetes and neurological disorders, cancer treatment
Nutraceuticals; Health Supplements
Medical, Rehabilitation and Home-care products
Hospitals Equipment and Hygiene Sterilized Supplies
Telemedicine
Joint R&D and licensing LIFE SCIENCES SECTOR OVERVIEW HK
Slide51 : Examples of Canadian Products in Hong Kong
Generic Drugs and Pharmaceuticals
Health Supplements and Foods
Rapid Test Kits
Medical Products
Investment LIFE SCIENCES SECTOR OVERVIEW HK
LIFE SCIENCES IN PRD : LIFE SCIENCES IN PRD
The PRD Market
In 2005, Guangdong had 16054 health institutions
Large number of medical equipments expected to be replaced in recent years
In 2006, Guangzhou became one of the four “national biotech bases”, mainly composed of Guangzhou Science City and Guangzhou International Bio-island
Total revenue of the Guangzhou Biotech Base is expected to be RMB 100 billion by 2010.
Slide53 :
Opportunities
Medical devices
Health Products
Pharmaceuticals
Nutraceuticals / food supplements
Lab instruments
Hospital equipment/supplies and clinical trials/joint development
Hospital Management Consulting Service LIFE SCIENCES IN PRD
THE FUTURE : THE FUTURE Closer Economic Partnership Agreement (CEPA) is bringing new business and investment
Hong Kong profits from Chinese growth
Bridge to Macau/Zhuhai will open up south bank of Pearl River for freight and investment
Cooperation through Greater Pearl River Delta Initiative (9 Chinese provinces + Hong Kong and Macau) is improving
Slide55 : Roots partners with Li & Fung to implement its ambitious expansion plan in Asia, starting with Hong Kong and planning to open 100 stores in China. RECENT KEY SUCCESS STORIES
Slide56 : RIM has tripled the size of its office in Hong Kong
Selected HK as entry point to Asia based on business network, infrastructure, and workforce RECENT KEY SUCCESS STORIES
Slide57 : Supplying Train Control & Signalling Systems (TCSS) to Hong Kong Subway Systems (MTR)
Received contracts worth over C$ 200 million in Hong Kong
Thales entered the China market via MTR’s role as an equity partner/consultant for subway systems being built in China
Thales has since won contracts in mainland China RECENT KEY SUCCESS STORIES
RECENT KEY SUCCESS STORIES : RECENT KEY SUCCESS STORIES Manulife employs 3,500 in its very profitable HK operations
Will have 5,000 agents by 2010
#2 provider of pensions in HK, with 15% market share
Uses HK as a gateway to develop the 382 billion yuan China market
Slide59 : RECENT KEY SUCCESS STORIES Purchases 10% of Canadian beef exports to HK
Also buys Canadian fish roe and salmon
Headquartered in HK, drives business development in the mainland
Holds franchise rights for Yoshinoya in Hong Kong (30 outlets) and China (74 outlets, 25% annual growth)
Slide60 : Venetian Macao will open a Cirque du Soleil permanent venue at Macao Venetian Casino RECENT KEY SUCCESS STORIES
Slide61 : Adrien Gagnon partners with CK Life Sciences to launch its products worldwide RECENT KEY SUCCESS STORIES
Slide62 : K.S. Li of Hutchison Whampoa has committed an additional amount of USD 100 million investment in Husky Oil RECENT KEY SUCCESS STORIES
Slide63 : Hong Kong has become the third largest market for Canadian beef, followed by Macao in 4th RECENT KEY SUCCESS STORIES
Slide64 : Market prospect
Key contact search
Information on foreign organizations
Visit information
Face-to-face briefing
Troubleshooting TCS CORE SERVICES
Slide65 : Canadian companies that have selected and researched their target markets
Large or small, new or experienced companies established in Canada
Foreign subsidiaries of established Canadian companies
Businesses or persons representing such companies OUR CLIENTS
Slide66 : InfoExport – www.infoexport.gc.ca
Canadian clients are invited to register - Free VTC – VIRTUAL TRADE COMMISSIONER