Hong Kong's window of opportunity
Updated: 2007-10-26 07:12
Hong Kong's Chief Executive Donald Tsang has called on fellow citizens to abandon their "island mentality" and adopt a new mindset to face challenges and take advantage of the opportunities presented by the mainland's rapid economic development.
Nobody can argue with that.
Our "island mentality," supplemented by our "refugee mentality", has manifested itself in our mad pursuit for quick gains and instant satisfaction in many things we do. As the center of wealth is slowly shifting toward various major mainland cities, speculative savvy alone is not going to help Hong Kong business people in gaining a meaningful share of the economic pie, despite its fast expansion.
Some economists and politicians have strongly recommended that the Hong Kong government take the initiative in setting a new direction for the economy. Such an economic policy would almost inevitably draw the government into greater involvement in the allocation of resources in favor of certain economic activities over the others.
This policy would represent a sharp departure of the guiding principle of "small government, big market" with the professed aim to preserve Hong Kong's free economic environment. What is more, in an open economy like Hong Kong, government influence on corporate investment decisions and bank lending policies is very limited, as it should be.
But the expanding services sector of the mainland economy is offering almost unlimited opportunities for Hong Kong service providers who enjoy a distinct advantage in terms of management expertise over their mainland counterparts.
To be sure, the standard of service in major mainland cities, particularly Guangzhou, Shenzhen and Shanghai, has improved greatly in the past several years. But it still seems to lag behind that of Hong Kong in terms of consistency and attention to detail.
This window of opportunity is closing fast. Hong Kong service providers should make haste to exploit the gap before they lose their competitive edge.
This is where the Hong Kong government can help. The mainland offices of the government-sponsored Trade Development Council, or TDC, should be charged with the additional responsibility of identifying investment opportunities in the services sector of the cities where they are based. This information should then be promoted vigorously to Hong Kong entrepreneurs through the various trade associations, professional bodies, chambers of commerce and other public channels.
Just posting the information on the government website is not enough. It may be possible for the TDC, or some other government agencies, to establish some sort of advisory service to handle queries about investment opportunities in the services industry in mainland cities.
Hong Kong expertise in the services industry, especially in the retail and hospitality sectors, has earned considerable recognition on the mainland. The turnaround of an ailing shopping mall in Shanghai's Pudong district by a Hong Kong consultant became a well-known success story after it was featured in a local TV program.
Indeed, Hong Kong companies as well as individual professionals are well represented in such areas as the media, catering, entertainment, real estate, financial services, tourism and other professional services. As the mainland's economic growth is set to be more consumption-led in coming years, the demand for higher quality services is expected to become increasingly urgent. So, instead of fretting about the looming competitive threat from Shanghai and other mainland cities, our entrepreneurs and professionals should think of them as places for new opportunities.
E-mail: jamesleung@chinadaily.com.cn
(China Daily 10/26/2007 page10)
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