Business in HK to remain as usual after handover

Business in HK to remain as usual after handover

JAKARTA (JP): Hong Kong's secretary for trade and industry,
Denise C.Y. Yue, assured Indonesia's business community yesterday
that Hong Kong's economic regime would be unchanged after the
colony was transferred to China.

Yue said businesspeople and investors should not feel
reluctant to continue operating there after China takes over on
July 1.

"It is business as usual in the area of trade and
investment ... 1997 should not be considered a factor when making
business decisions," she said after speaking at a seminar on
implications for business in Hong Kong under Chinese rule.

She said that under the "one country-two systems" concept,
Hong Kong would continue as a capitalist economy and an
international business center.

"Hong Kong will continue operating under the rule of law, with
its cosmopolitan life unchanged for 50 years beyond 1997," she
said.

Yue said the 50-year period would effect business decisions.

"Business people usually think in the framework of between two
and 20 years," she said. Those wanting to invest in major
industrial projects consider a 15 to 20 year span, while those
engaged in manufacturing and trading have a time horizon of only
12 to 36 months, she said.

She said investments had continued to enter Hong Kong in the
past couple of years and was likely to continue after July 1.

"As far as outward investment from Hong Kong is concerned,
that has been continuing and we predict it will continue to
happen," she said.

According to the latest report published by the United Nations
Conference on Trade and Development (UNCTAD) Hong Kong was the
world's fourth largest provider of foreign investment after the
United States, Britain and France.

"The reason for this is that about 50 million overseas Chinese
are using Hong Kong as the conduit for their investment in other
places," she said.

Yue said that despite the optimism, Hong Kong people realized
there were many problems to resolve with mainland China.

"But the people of Hong Kong are very used to dealing with
adversities ... They have been known to turn adversities into
opportunities," she said.

"We are optimistic with good reasons but we do not
underestimate the difficulties that we still have to resolve with
mainland China. But we have been dealing with mainland China for
the last 13 years of transition, so we have also developed a much
better knowledge of the systems in mainland China and of managing
our relationship with them," she said.

Yue said Hong Kong's government reserves and taxes would
remain in Hong Kong and be used in and by the colony.

Thus there was no question of Hong Kong taxes and government
reserves being used in mainland China.

After July 1, Hong Kong would continue to maintain a level
playing field for all business entities there, she said.

"We are, in Hong Kong, nationality blind. All companies that
are registered in Hong Kong under the laws of Hong Kong are
treated in exactly the same way," Yue said.

The chairman of the Indonesian Chamber of Commerce and
Industry, Aburizal Bakrie, said yesterday the main concern of
Indonesia's business community was not on the integration of
China and Hong Kong, but whether or not it would be followed by
change.

"We might worry if the integration means investments from Hong
Kong would decline, or if trade relations would be disrupted or
if doing business in Hong Kong would become difficult," he said.

Bachrum Harahap, an assistant to the Coordinating Minister for
Production and Distribution, said that in the last 30 years Hong
Kong companies invested in 360 projects worth US$18.6 billion in
Indonesia.

Hong Kong is the third largest foreign investor in Indonesia
after Japan and the United Kingdom. (pwn)