Hong
Kong Economy
The mainstays of Hong Kong’s economy
are trading, light manufacturing,
media, shipping, tourism and financial
services as well as the property sector,
which is of great interest to locals but little to outsiders. Even
though transport routes to the newly operating ports across coastal
China are challenging Hong Kong’s pre-eminence, the city’s
great trading house are still important. These major international
conglomerates, such as Jebsen, Swire, and Jardine
Matheson, have greatly diversified interests.
Li Ka-shing and his Hutchinson Whampoa
is the quintessence of how Hong Kong’s economic power, established
on trade, has branched out octopus-like from the Pearl River
Delta into very diverse locales and commercial holdings,
varying from ports to telecommunications. Property,
through eminent houses like Sun Hung Kai Properties
and Kerry Properties, provides most of the investment
money to support Hong Kong’s broader economy, however the
sector itself has been in trouble since the late 1990s. Tourism
may yet be Hong Kong’s salvation, with the scheduled completion
of the Hong Kong Disneyland on Lantau island in
2005 and new casinos from Las Vegas opening up in nearby Macau.
However, its bounty is yet to arrive.
Government figures for 2001 declare Hong Kong’s labour
force as just under 3.5 million. Gross
National Product (GNP) stood at HK$1.3 trillion
in 2001. The September 2002 census listed import and export
trade as the largest single job provider, with an 513,000-strong
workforce. Financial, real estate,
and business services follow with over 424,500
employed. The headline unemployment in Hong Kong was 7.2% in October
2002, nearly its highest ever, creating serious challenges for industry
and government. Unofficial surveys report the PRC’s unemployment
is also in this region, at 7%, however official figures list it
as 3.6%.
Hong Kong has become a major international financial centre
since the 1980 incorporation of its stock exchange – now the
tenth largest in the world, as ranked by capitalisation, but is
soon to be overshadowed by Shanghai and Shenzhen.
Banking, insurance and other
financial services are provided to mainland and local companies,
as well as the many international conglomerates maintaining offices
there.
The Hongkong and Shanghai Banking Corporation is
the strongest bank to have originated locally and
have an international presence. The Bank of East Asia
is another noteworthy body. Investment banking houses, such as Goldman
Sachs and BNP Prime Peregrine, are also
very active locally. A huge number of financial brokerage houses,
lots of them now online, serve the huge appetite of the Hong Kong
punter for short-term speculative investing. They also provide a
broader range of investment services that use this funds to gamble
on a larger scale with various kinds of venture capital initiatives.
Manufacturing is mainly in textiles,
consumer electronics and additional consumer
goods – Hong Kong is the world’s largest
producer of children’s toys. Often, manufacturing
operations are based in Hong Kong but use cheap labour across the
border. The shipping and logistics sectors are assisted by Hong
Kong’s natural deep-water harbour, possibly the best in the
region. Maritime entrepôt trade remains very
important, although somewhat overshadowed by competition from Shanghai
and other ports in Shenzhen and South East Asia.
Hong Kong also has a powerful media and telecommunications
sector, banging out Cantopop,
kung fu movies and other fodder for the Greater
China public. Firms like Golden Harvest and the
Emperor Entertainment Group lead the local industry.
Internet and telecommunications firms, such as Richard Li’s
Pacific Century CyberWorks, have thrived on the backs of
established telcos like Cable and Wireless
HongKong Telecom. Hong Kong’s efforts to reestablish
itself as a wired city of the new millennium have waned as a dominant
policy theme, however the quality of the telecoms infrastructure
is still very good. Investment into China has replaced this strategy
as the primary current entrepreneurial driver.
The main financial district of Hong Kong is the
International Finance Centre (IFC), where the Hong
Kong Stock Exchange is located, but this is more similar
to a mall or walkway complex than Wall Street. Most corporate headquarters
are based around Central, Admiralty and Nathan Road, on Kowloon
Side.
Business Etiquette
Suits are proper attire for business – Hong Kong is surprisingly
formal in its outward business standards, contrasting the casual
bucaneering enterpreneurialism of its business practices. Hong Kongers
are very serious about business punctuality – appointments
should be arranged in advance and kept. The culture of business
cards prevails and, if possible, cards should include Chinese translations
on the reverse. Nearly all top hotels have business centres for
visiting businesspeople, with typing, translation, photocopying,
and other services.
Normal office hours
are 09:00–13:00 and 14:00–18:00 Monday to Friday and
09:00–13:00 Saturday, with many offices staying open later
on Saturday and just about every Hong Kong office is full of late-night
workers long after sunset.
Although business lunches (particularly dim sum) and after-hours
drinking are a normal part of the Hong Kong business scene, there
is not the same emphasis on drinking and bonding evenings as there
is in Japan. Hong Kongers are much too busy focusing on the bottom
line to think about company camaraderie and many don't have the
tolerance for alcohol like their hardened mainland compatriots.
Ex-pat workers mainly drink together but it's not a formal part
of local business culture – however it does seem to be an
unavoidable one. |
