Speech by SCED at lunch meeting with Dutch business leaders in Schiphol (English only)
Following is the speech by the Secretary for Commerce and Economic Development, Mr Gregory So, at a lunch meeting with Dutch business leaders in Schiphol, the Netherlands, today (June 6, Schiphol time):
Mr Poulis (Chairman of the Netherlands Hong Kong Business Association, Mr Hans Poulis), distinguished guests, ladies and gentlemen,
Thank you, Mr Poulis, for your kind assistance in organising this lunch meeting. I am excited to be here because there is so much that Hong Kong may learn from you all. You are a trading nation with hundreds of years of experience, and located at the mouth of two large rivers that run through some of the most productive areas in Europe. You have very impressive logistics facilities. Indeed, to foreigners, sometimes the Netherlands seems to be one big, efficient logistics facility.
Hong Kong, too, has a trading tradition. We similarly lie at the mouth of a great river, which runs through one of the most advanced manufacturing and prototyping centres in the world. We have one of the world's busiest container ports and the world's busiest international air cargo terminal. To realise our full potential though, we must integrate our transport and logistics links more efficiently. I am certain that we can pick up a lot from the Dutch, and in so doing create commercial opportunities for both of our business sectors.
Speaking of business, Hong Kong and the Netherlands have strong and long-established ties. The Netherlands is the third largest trading partner of Hong Kong among all European Union member states. The bilateral merchandise trade between Hong Kong and the Netherlands enjoyed promising annual growth over the past five years. In 2016, the bilateral merchandise trade between the two places was valued at a total of over 9.2 billion Euros and I am happy to note that the volume continues to expand in the first quarter of 2017 as compared with the same quarter of 2016.
At present, there are some 250 Dutch firms in Hong Kong which form a vibrant and diverse group spanning various industries, ranging from airline, financial services, logistics, petroleum and engineering to food and beverage. Around 100 of them have set up their regional headquarters or regional offices in Hong Kong.
These Dutch companies make use of Hong Kong's unique advantages to extend their reach to the Far East. The unique status that Hong Kong enjoys under the "one country, two systems" principle and our very strong links with the Mainland of China continue to make us the preferred location for doing business in Asia. Added with our fundamental strengths, including the rule of law, free flow of capital and information, a business-friendly environment, a diverse and international talent pool and a low and simple tax regime, Hong Kong has earned the title of the world's most competitive economy awarded by Switzerland's IMD World Competitiveness Yearbook in both 2016 and 2017. Also, Hong Kong was ranked the freest economy by the Heritage Foundation of the United States for the 23rd consecutive year, once again affirming our steadfast commitment in safeguarding the free market principles.
Being a global financial, logistics and trading hub, Hong Kong will continue to play the important role of a "super-connector" between the Netherlands and the Mainland of China. In fact, I am confident our co-operation will only expand in the coming years, thanks to the ambitious and visionary initiative of the Silk Road Economic Belt and the 21st Century Maritime Silk Road, commonly known as the Belt and Road Initiative that was spearheaded by President Xi of China in 2013.
This grand and far-reaching initiative aims to expand trans-continental connectivity and promote economic, political and cultural co-operation from Asia through Africa and on to Europe. I believe it will emerge as a driving force of the world economy in this 21st century.
Allow me, over the next few minutes, to share with you some of my thoughts on how Hong Kong can support Dutch businesses, and how we can help you capitalise on the wealth of opportunities emerging from the Belt and Road Initiative.
Through the Belt and Road Initiative, we expect to see soaring investments in infrastructural facilities, deepening financial integration, expanding trade and the building of people-to-people bonds on a global scale. The Belt and Road Initiative covers various aspects and proposes co-operation in many sectors, but fundamentally the Initiative is about making connections. And I am proud to say that facilitating connections is also what Hong Kong is good at. This is how we see Hong Kong will contribute to, and benefit from, the Belt and Road blueprint.
Hong Kong may play this facilitator role perfectly, thanks to the unique advantages presented by our "one country, two systems" arrangement I mentioned earlier. When you are in Hong Kong, you are in China - a Special Administrative Region of China that provides the combined advantages of "one country" and "two systems". Hong Kong is an international gateway to Mainland China, offering unique physical and intangible connectivity to the Mainland with privileged trade and social access. On the other hand, Hong Kong has a well-established system that connects us to the international community in terms of our legal system, language, trade practices as well as lifestyle which international traders are familiar with.
Traders in all sectors, and from all jurisdictions, can trade freely in Hong Kong. And all persons, businesses and organisations, regardless of their nationality, are treated exactly the same. Every business in Hong Kong can enjoy the same privileges and benefits provided by our international agreements.
Consider, for example, CEPA (the Mainland and Hong Kong Closer Economic Partnership Arrangement), Hong Kong's free-trade agreement with the Mainland of China. CEPA provides preferential treatment to Hong Kong service providers, regardless of nationality, as well as tariff-free treatment for products that have been conferred the Hong Kong origin. Working with Hong Kong, Dutch companies can gain the same access to the markets of the Mainland. It's your ticket to the massive Chinese consumer market and its fast-rising middle class.
"One country, two systems" has made Hong Kong the "super-connector", bringing together the rest of China and the rest of the world, and that, of course, includes economies along the Belt and Road. This also makes us a magnet for business - at last count, over 8 000 international companies have commercial presence in Hong Kong. Hong Kong has always been a preferred venue for hosting regional headquarters or trading offices for multinational companies to manage their businesses in the Asia-Pacific. And I hereby invite more Dutch companies to come to Hong Kong and make full use of our advantages in tapping the massive Belt and Road markets.
Aside from trade, logistics is another key area that has been driving Hong Kong's development as an international business centre. The Belt and Road will catalyse the movement of people and goods, boosting demand for reliable logistics services. In this, Hong Kong is also well served. Indeed, Hong Kong boasts the world's fifth busiest container port, providing some 350 services a week to more than 500 destinations worldwide. Our 700 shipping-related companies offer a wide range of services, from ship management, broking and chartering to finance, marine insurance, legal, arbitration and many other support services. Our airport has been the busiest cargo airport in the world for more than 15 years. From Hong Kong, you can reach all major Asian economies within four hours' flight time. Half the world's population is just five hours away. The Maritime Silk Road will create fresh demand for shipping services. Dutch logistics companies will find it advantageous to establish a presence in Hong Kong, using our maritime services to tap into the markets of the Belt and Road.
Among the Belt and Road's main goals is promoting big-ticket infrastructural development, from highways and railways to maritime and aviation transport, as well as telecommunications and energy projects. Hong Kong certainly will have a lot to offer and the expertise to share when it comes to international co-operation on infrastructural projects envisaged under the Belt and Road. Why? Because we have a deep pool of talented professionals, from engineers and surveyors to architects, designers and planners, not to mention other professionals specialised in financing, insurance, arbitration, risk management and project consulting. All of them are experienced and eager to partner with overseas businesses, including Dutch companies, to take part in the development, management and operation of infrastructural projects under the Belt and Road Initiative.
Other than professional services, financial services will of course be another important area for co-operation under the Belt and Road. Hong Kong is China's international financial centre and we are also one of the leading financial centres in the world. We have the experience, the expertise and the connections to serve as the fund-raising and financial management hub for the Belt and Road.
Ladies and gentlemen, Hong Kong has what you need in a strategic partner for the 21st century. We welcome Dutch investment and talent. In Hong Kong, you can take advantage of our low taxes, our world-class business environment and our reassuring legal system, as well as our knowledge in tapping the massive Asian markets.
The Belt and Road will be built on collaboration - on deepening the bonds between nations, economies and cultures. The opportunities before us are in abundance. I look forward to joining hands with our friends in the Netherlands to realise the opportunities ahead. Thank you.
Ends/Tuesday, June 6, 2017