Hong Kong, Mainland China & Asia: Challenges and Opportunities - - PowerPoint PPT Presentation

Hong Kong, Mainland China & Asia: Challenges and Opportunities in 2020 and beyond Webinar | Tuesday, May 5, 2020

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Webinar Partners:

Su He, Executive Director Greater Cleveland Chinese Chamber of Commerce Moderator

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Hong Kong, Mainland China & Asia – Challenges and Opportunities in 2020 and beyond Moderator Panelists

Su He

Executive Director Greater Cleveland Chinese Chamber

• f Commerce

Winchell Cheung

Director Midwest, Hong Kong Trade Development Council

Kimberly Kirkendall

President International Resource Group, Inc.

• Non-profit organization serving Chinese and American business communities in

Northeast Ohio.

• 3 Groups:

– Chinese companies pursue business opportunities in the U.S. – Local business owners, professional, entrepreneurs, and students in Northeast Ohio – American companies and professionals want to learn more about doing business in China

• Provide support on:

– Professional knowledge – Link to partners and networking opportunities – Delegations – Communities care https://www.clechinesechamber.com

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Hong Kong, Mainland China & Asia – Challenges and Opportunities in 2020 and beyond Moderator Panelists

Su He

Executive Director Greater Cleveland Chinese Chamber

• f Commerce

Winchell Cheung

Director Midwest, Hong Kong Trade Development Council

Kimberly Kirkendall

President International Resource Group, Inc.

Winchell Cheung, Director Midwest Hong Kong Trade Development Council Speaker

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Hong Kong Trade Development Council

A Hong Kong statutory body established in 1966 Helps international businesses explore opportunities in and through Hong Kong Promotes Hong Kong as Asia’s business platform and services hub A go-to organisation for Asia and Greater Bay Area opportunities A partner for start-ups & SMEs 50 offices globally, including 13 in Mainland China

Assists international companies and investors to explore and enter new markets in Mainland China and throughout Asia Facilitates Chinese outbound investment in both mature and emerging markets Connects businesses worldwide with Hong Kong partners, including product suppliers and services providers Provides market intelligence

Tel: (852) 1830 668 www.hktdc.com https://www.linkedin.com/company/hong-kong-trade-development-council @hktdc

➢ Three months into the fight ➢ Economic performance ➢ US – China trade conflict ➢ Anti-epidemic efforts ➢ Supporting businesses

Hong Kong Economic Update

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Asia and Mainland China Economic Outlook

Real GDP % Growth Estimates/Projections (IMF) Economies

2017 2018 2019

Emerging & Developing Asia^

6.5 6.5 6.5

Mainland China

6.9 6.6 6.4

Advanced Economies *

2.4 2.4 2.2

World

3.7 3.9 3.9

^Including Mainland China , India, ASEAN nations except Singapore, etc

• Including US, Canada, Euro area, UK, Switzerland, Sweden, Norway, Denmark, Czech Republic, Israel,

Australia, New Zealand, Japan, Korea, Singapore, Taiwan, Hong Kong, etc (Source: IMF World Economic Outlook , July 2018)

China and Emerging & Developing Asia offer great

• pportunities for US products and services.

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ASEAN & Hong Kong

Hong Kong

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ASEAN & Hong Kong

Hong Kong US Remarks Malaysia 3rd 5th (end-2018 stock) Myanmar 4th 13th (end-2019 stock) Indonesia 4th 7th (2018 flow) Vietnam 4th 11th (2018 flow) Thailand 3th 4th (end-2018 stock) Philippines 13th 6th (2018 flow) Singapore 10th 1st (end-2018 stock) Brunei 1st NA (2018 flow) Cambodia 2nd NA (2018 flow)

Ranking of FDI flow to ASEAN as a whole in 2018 (latest stats): HK: 3rd (US$10.1 billion), US: 5th (US$ 8.3 billion)

➢ Hong Kong has forged eight FTAs:

• Mainland, New Zealand,

Member States of the European Free Trade Association, Chile, Macao, Association of Southeast Asia Nations, Georgia, Australia ➢ Hong Kong has signed CDTAs with 40 tax jurisdictions

Strategic Hub to Expand Your Business

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Guangdong-Hong Kong-Macao Greater Bay Area

➢ Comprises Hong Kong, Macao and nine Guangdong cities ➢ 4 core cities: Hong Kong, Macao, Guangzhou and Shenzhen

LAND AREA

56,000km2

>Ireland, Latvia, Panama, West Virginia (US)

POPULATION

70mn

(5% of China’s population)

>UK, Italy, South Africa

GDP

US$1.6 trillion

(12% of China’s GDP)

>Indonesia, Netherlands, Turkey

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Greater Bay Area: Objectives

➢To develop an international first class bay area for living, working and travelling ➢Highly vibrant and innovative ➢Optimized industrial structure ➢Smooth flow of various factors (e.g. people, goods, capital and information) ➢Pleasant ecological environment ➢Infrastructural connectivity (1-hour living circle)

Beijing Seoul Osaka Tokyo Changchun Harbin Shenyang Dalian Tianjin Nanjing Fukuoka Shanghai Hangzhou Nanchang Fuzhou Guangzhou Taipei Jinan Shijiazhuang Taiyuan Zhengzhou Xian Hefei Wuhan Chengdu Chongqing Changsha Guiyang Kunming Guilin Haikou Manila Ho Chi Minh City Bangkok Hanoi Kuala Lumpur Singapore Jakarta Dhaka Delhi Chennai Mumbai Bangalore Colombo

Hong Kong

All of Asia’s key markets within from half the world’s population

Hong Kong: Ideal Location Gateway to Mainland China and Asia

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Leveraging Hong Kong Advantages

World’s freest economy for 25 consecutive years No.2 for economic freedom

• No. 1 air cargo hub

World’s 2nd most competitive economy World’s 3rd east of doing business World largest IPO market 2018 & 2019

• No. 1 financial system
• No. 3 FDI inflows and No. 4 FDI outflows

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Janet Yellen at Asian Financial Forum Hong Kong, January 13 – 14, 2020 “It’s a place where free enterprise thrives, rule of law, highly open capital markets, great financial expertise and a home for the world’s greatest financial institutions.”

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Rule of law: protection of contracts & IP Free flows of information, people, goods & capital Level playing field

Hong Kong: Strong Fundamentals

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The Hon. Beverley McLachlin – Judge, HK Court

• f Final Appeal

“The law is very rigorously applied. It’s a very high level

• f judging. The court

is independent.”

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Low and Simple Tax System

Factors: Total tax & contribution rate Time taken to comply with

• bligations
• No. of payments

Post-filing procedures

Ease of Paying Taxes Rankings 2019 (PwC + World Bank)

Country Ranking

Hong Kong

1 UAE 2* Qatar 2* Ireland 4 Bahrain 5 Singapore 8 Korea 24 Thailand 59 Malaysia 72 Japan 97 Indonesia 112 Mainland China 114 India 121

• Qatar and UAE are tied at No.2

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Hong Kong: Global Business Hub

Bridge linking Asian and global companies

Large number of overseas companies: >8,700, June 2018 Visa-free entry for 170 countries’ nationals 120 consulates > 30 overseas business chambers

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Risk Management & Dispute Resolution

Risk management: presence of large pool of international professionals More than half of Global 100 law firms have presence in Hong Kong Hong Kong Law Society has a Belt and Road Committee

Hong Kong: Most preferred arbitral seat outside Europe; 3rd worldwide (Queen Mary University of London survey 2015)

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Vibrant start-up scene in Hong Kong

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Facilitating growth of start-ups through HKTDC’s worldwide promotions

• i. Our anchor events in Hong Kong

SmartBiz Expo

event showcasing technology enhancement, transformation and upgrading solutions for SMEs

• Enterprise Connect

Link up start-ups with corporate users

Entrepreneur Day

start-up event for information, funding, connections and talents

• Themes

Hospitality, edtech, healthtech, smart city

• E-Living Hackathon

Young talents to pitch their ideas for solving pain points in our daily life

• GBA Compass

Seminar series on GBA opportunities

SmartBiz Expo

event showcasing technology enhancement, transformation and upgrading solutions for SMEs

• Enterprise Connect

Link up start-ups with corporate users

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Electronic Fairs & ICT Expo Houseware Fair Medical and Healthcare Fair Gifts & Premium Fair

• i. Our anchor events in Hong Kong

InnoVenture Salon & Fintech Showcase at the Asian Financial Forum The first-ever IP Hatch at BIP Asia Forum Startup Zones in HKTDC’s trade fairs Will target start-ups from Shenzhen, Guangzhou, Zhongshan and Dongguan

Connect start-ups with investors and media through exhibition, demo hours, knowledge exchange sessions and business matching

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Start-ups Start-ups

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Facilitating growth of start-ups through HKTDC’s worldwide promotions

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hktdc.com Sourcing Business as usual with HKTDC online marketplace

▪ Connect global buyers and suppliers amid trade show rescheduling and travel bans arising from Covid-19 pandemic ▪ Fulfill buyers’ procurement needs during peak sourcing seasons ▪ Theme-based promotional campaigns in response to global sourcing trends and demands

Wine and Liquors Food Products Lifestyle Brands ICT Beauty and Personal Care Products Environmental products Medical supplies

US Products in Demand

Start-ups (Innovation and Technology) Fintech Brand Marketing Green Technology E-Commerce Solutions Logistics software Healthcare Technology

US Services in Demand

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HKTDC: Marketing & Sourcing Trade Fairs

30+ world-class trade fairs Around 39,000 exhibitors, over 770,000 buyers a year Forming 11 largest marketplaces in Asia

Gifts & Premium Electronics (Autumn) + electronicAsia Houseware Fashion Fall/Winter Electronics (Spring) FILMART Licensing Watch & Clock Toys & Games Jewellery + Diamond,Gem & Pearl Lighting (Autumn)+ Outdoor Lighting

Opportunities and Cost Savings

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HKTDC: Global Network

50 offices worldwide outside Hong Kong 13 in Mainland China

Beijing

Hong Kong

Tokyo New York Bangkok Dubai

London

Frankfurt Sydney

L.A. Chicago

Kuala Lumpur Jakarta Singapore Ho Chi Minh City

Seoul

Manila

HKTDC Chicago Office Tel: (312) 726-4515 Email: chicago.office@hktdc.org

Kimberly Kirkendall , President International Resource Development, Inc. Speaker

Hong Kong, Mainland China & Asia: Challenges & Opportunities in 2020 & beyond

Kimberly Kirkendall, CPA President, International Resource Development, Inc. CFO, Greater Cleveland Chinese Chamber

Look at Asian Region & China Economies

Many of the same economic indicators that Winchell mentioned –  Trade war’s effect on the Asia (boom) & China (bust)  Virus effect on Asia (slow down) & China (shutdown)  Will countries be able to ramp quickly back up to their pre-virus levels?

Near Future Outlook

2020 and into 2021 what can we expect?

 Even if one country or region rebounds – we are very interconnected / interdependent  Shutting down is easier than opening up – will take 6 months even without governments actions relating to the virus  Short term we will see essential businesses back up (automotive, food, clothing, business travel, etc)  The non-essential could take 12-24 months (personal travel, upgraded goods, optional investments, etc)  Ongoing uncertainty may keep buying & investment down  Will countries that spent to jump start their economies now have to belt tighten because of deficits?

The International Monetary Fund, whose assessment of the economy is widely followed, expects the global economy to shrink by 3% this year. Only a handful of economies – such as China and India - are expected to grow

While the IMF has forecast a rebound of 5.8% next year, it said the recover is only partial and global activity will be below what was projected for 2021.

Market: Mainland China & Asia

Growth in certain categories are expected for the next few years:  Health & Wellness  Home Décor and Electronics  Education Online  Personal Care Products  Elder Care  Remote Tracking / Communication  Services – audit / inspection, R&D, Lean / High Tech

How to Approach the Market

 Online, Online, Online  Social Media is multi-layered, you need to be present in key platforms to build trust and access  Ecommerce has boomed and will continue to grow  Growing nationalism – local media, language, etc.  Regional supply and distribution  It’s a fine line – aspiring foreign goods and resenting foreign meddling.

Trade

 Logistics will continue to be disrupted through the rest

• f 2020 and into 2021

 International travel has been shut down – and will reopen slowly  Businesses often rely on Superman to resolve problems at remote locations / customers / suppliers – and Superman cant fly  Therefore increased quality problems, fraud, delays,

• etc. (more on this later)

Manufacturing

 The interconnected Supply Chain –identify risks  Your supplier / customer make be operational – but can they get raw materials or are their customers open? How can you find out?  Disrupted labor = more quality problems  Expect increase in business failures & consolidation  Government support for labor / lending will help in 2020, but can companies recover after that? Could be a going concern risk

How to Stay On Top - Remotely

You can’t travel, but you need to stay on top of your business  More frequent communication  Ask the same questions to different people, different ways, using different medium  Have a third party involved ton confirm  Increase how many times you review / inspect  Use objective (not subjective) tools to gather information – video, photos, testing, etc.

Thank You to our partner!

CONTACT: SPEAKER - Kimberly Kirkendall EMAIL: virtualoutsource@hotmail.com Greater Cleveland Chinese Chamber www.clechinesechamber.com

Q & A Ask the Experts!

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Hong Kong, Mainland China & Asia – Challenges and Opportunities in 2020 and beyond

Moderator Panelists

Su He

Executive Director Greater Cleveland Chinese Chamber

• f Commerce

Winchell Cheung

Director Midwest, Hong Kong Trade Development Council

Kimberly Kirkendall

President International Resource Development, Inc.

Connect with the Speakers! Su He – www.clechinesechamber.com | LinkedIn Winchell Cheung – www.hktdc.com | LinkedIn Kimberly Kirkendall – www.intlresource.com | LinkedIn Christine Barragan – www.hktdc.com | LinkedIn

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Hong Kong as a Base for Entry into Mainland China and Asia 2nd in 2-Part Webinar Series Check your emails for registration details!

Hong Kong, Mainland China & Asia: Challenges and Opportunities in 2020 and beyond Webinar | Tuesday, May 5, 2020 Thank you for joining us! A survey about today’s webinar will be emailed to you.