Cashing in on free trade

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Last updated at: (Beijing Time) Monday, January 05, 2004

Cashing in on free trade

Major Chinese cities are taking the lead promoting made-in-Hong Kong goods imported tariff-free under the Closer Economic Partnership Arrangement (CEPA).

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Major Chinese cities are taking the lead promoting made-in-Hong Kong goods imported tariff-free under the Closer Economic Partnership Arrangement (CEPA).

The arrangement, which took effect on January 1, is designed to jump start Hong Kong manufacturing and service industries in the mainland as it opens up to foreign companies its entry into the World Trade Organization.

The rising popularity of a wide range of Hong Kong products among mainland consumers, especially in major cities, has piqued the interest of mainland business. Closer co-operation between mainland retailers and Hong Kong manufacturers is widely seen as essential to the success of the arrangement.

In large cities like Beijing, such co-operation is quickly becoming evident.

At the initiative of the district government of Chaoyang, the largest Beijing ward that encompasses the central business district and the embassy area, four large shopping centres have arranged to set up exclusive sales counters to showcase and sell made-in-Hong Kong products. These counters at SCITECH Plaza, Blue Island Plaza, Full Link Plaza Shopping Arcade and Zhongfu are expected to open this month.

Shopping centres in Shanghai and Guangzhou have similar plans.

Such efforts to promote imports are receiving great support from the Hong Kong business community.

"It is a cost-effective way for Hong Kong manufacturers to explore the mainland market," says Kevin Lau, president of the Hong Kong Watch Manufacturers Association.

He expects a much wider range of made-in-Hong Kong products will begin showing up in large quantities in shopping centres and department stores by March.

Li Xiaoqun, an official of the Chaoyang District Government, says the most popular products will include garments, cosmetics, food, jewellery, clocks and watches, and some electric products.

"We aim to create a bridge between mainland retailers and Hong Kong producers," Li says. "Our efforts have received enthusiastic support from both sides."

Yan Ligang, a spokesman for the Beijing Business Bureau, said the Chaoyang District Government is acting as an administrative service provider to help local shopping-centre operators take advantage of the business opportunities CEPA provides. At the same time, those efforts may ease the way for Hong Kong producers to penetrate the local marketplace.

Xu Mingli, manager of a department store in Guiyou Plaza, a popular shopping centre located in Chaoyang District, told China Daily the plan is good news for his firm.

Hong Kong products, especially jewellery items, have been selling well even without tariff concessions.

"Chow Tai Fook, Chow Sang Sang and Tse Sui Luen, well-known, Hong Kong-based jewellery companies, have a presence in our plaza," says Xu. "Their goods are selling very well, especially during festivals when people traditionally go out to buy some jewellery items," he says.

Zhao Jing, a 28-year-old manager at a multinational company in Beijing, says he had just bought a wedding ring made by a Hong Kong jeweller for 30,000 yuan (US$3,627) because he liked the design and the workmanship.

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