Speeches

Business Seminar on Explore Business Opportunity between HK and West Java in Bandung Indonesia

Following is the speech by the Director-General of the Hong Kong Economic and Trade Office in Jakarta, Mrs DO PANG Wai Yee, at the business seminar “Explore Business Opportunities Between Hong kong & West Java” co-organised by the Hong Kong Economic and Trade Office (HKETO) in Jakarta, Hong Kong Trade Development Council (HKTDC) and Indonesia-Hong Kong Business Association (IDHKBA) in Bandung, Indonesia today (October 5):

Pak Agung (Chairman of Indonesian Chamber of Commerce and Industry (KADIN) West Java), James (Chairman of IDHKBA), Kwan Ho (Director of HKTDC in Indonesia), Ladies and Gentlemen,

Selamat Pagi! I am DO PANG Wai-yee, the Director-General of the Hong Kong Economic and Trade Affairs, Jakarta. This is my first official visit to Bandung and I am happy to meet you all and introduce Hong Kong to you.

HKETO Jakarta

To begin, let me introduce the Hong Kong Economic and Trade Office in Jakarta to you. We represent the Hong Kong SAR Government in matters between Hong Kong and ASEAN as a whole, and handle in particular matters between Hong Kong and four countries, namely Indonesia, Malaysia, the Philippines and Brunei.

Economic and Trade Offices, ETO for short, are the representative office of the Hong Kong Special Administrative Region Government in that country as well as the region it covers. They seeks to promote Hong Kong’s economic and trade interest by liaising closely with a wide range of interlocutors and contacts. They also handles all bilateral matters relating to economic, technology and cultural issues, etc. between Hong Kong and the respective countries under the office’s purview.

Our office commenced operation in June 2016 and is the latest edition to the 11 ETOs around the globe, that is to say, we are number 12 in the ETO family. In Asia, there are two other, one in Tokyo covering Japan and Korea and one in Singapore covering the remaining six ASEAN countries. The Hong Kong Government is keen to enhance closer relations with ASEAN countries, hence our new office.

With our office is based in Jakarta, we are keen to get to know all major cities in Indonesia, and Bandung being the third largest city and capital of Indonesia’s West Java province is definitely one of our top priorities. We are keen to work closely with our partner, Hong Kong Trade Development Council, to build closer relations with all key cities in Indonesia.

Hong Kong and ASEAN

The ties between Hong Kong and ASEAN have been growing stronger in the past few years. In 2016, ASEAN was our second largest partner in merchandise trade. From 2012 to 2016, the bilateral goods trade between Hong Kong and ASEAN grew at about 3.4% on average every year. In terms of services trade, ASEAN was our 4th largest partner in 2015. The total trade in services value between ASEAN and Hong Kong amounted to US$15.5 billion, accounting for 8.9% of our total services trade in 2015.

To strengthen economic relation with ASEAN and contribute to regional economic integration, Hong Kong and ASEAN has recently concluded the negotiations on a Free Trade Agreement (FTA for short) and a related Investment Agreement. The Agreements will be signed in November this year and they are comprehensive in scope, encompassing trade in goods, trade in services, investment, economic and technical co-operation and dispute settlement mechanisms. The FTA will be effective after completion of the necessary procedures.

Hong Kong and Indonesia

As regards to the relation between Hong Kong and Indonesia, Indonesia is currently Hong Kong’s 22nd largest export market in the world and the 6th largest market in ASEAN. In 2016, Hong Kong’s exports to Indonesia amounted to US$2.7 billion whereas for the same period, Hong Kong’s imports from Indonesia amounted to US$2.3 billion.

Apart from trade, Hong Kong is also one of the major source of foreign direct investment in Indonesia. According to the latest data from the Investment Coordination Board of Indonesia, Hong Kong ranks fourth in terms of foreign direct investment in 2016. Total foreign direct investment from Hong Kong stood at US$2.2 billion.

We believe there is huge potential for Indonesia and Hong Kong to build closer relations. And this is not only limited to trade, investment and business, but also cultural exchanges and people to people link. For example, more than 460,000 Indonesian tourists visited Hong Kong in 2016, representing a cumulative growth of 43% over a decade ago.

Today, I would like to use this opportunity to introduce Hong Kong to our new friends here, and how you could tap into the opportunities brought by Belt and Road Initiative through partnering with Hong Kong.

Hong Kong – One Country Two Systems

There are many things which make Hong Kong unique but one of the key characteristics that makes Hong Kong stands out is that we are a Special Administrative Region established pursuant to the “One Country, Two Systems” principle. Put it simply, the concept is that while Hong Kong is part of Mainland China, the “One country”, Hong Kong would enjoy a high degree of autonomy, the “Two systems”.

The “One Country Two Systems” in Hong Kong is implemented through the Basic Law. The Basic Law is a piece of national legislation of the People’s Republic of China and it is the most important constitutional document of the Laws in Hong Kong which provides the legal basis for establishing the Hong Kong Special Administrative Region. Thus far, Hong Kong is thriving under “One Country Two Systems” where our strong tradition in the rule of law, our free and open economy, our capitalist system prevail.

Rule of Law

In terms of rule of law, Hong Kong continues to adopt the common law system. We also enjoy independent judicial power where the power of the final adjudication of court cases in Hong Kong rest with the Court of Final Appeal there. Our judicial independence has received international recognition.

Fundamental human rights are fully respected in Hong Kong. The right to liberty and security of person are firmly guaranteed under the Basic Law and the Bills of Rights and citizens are guaranteed the freedom of expression.

Capitalist City

The “One Country, Two Systems” principle provides that Hong Kong to continue the capitalist system. This means that there is –

Free flow of capital. You can bring in or repatriate your money in any amount, currency at any time you want;

The policy of free trade which safeguards the free movement of goods, intangible assets and capital, and that Hong Kong SAR can participate in relevant international organizations and enter into international trade agreements; and

Protection of private ownership of enterprises, legitimate right of inheritance and foreign investment.

The rule of law is an indispensable element for the success of Hong Kong and it has greatly facilitated our economic development. Investors’ money would be well protected by a robust, transparent and enforceable legal framework;

With the free flow of capital safeguarded, Hong Kong has been able to attract a large volume of foreign investment in the past 20 years.

Other edges of Hong Kong

In fact, Hong Kong is one of the best places in the world to do business. Hong Kong is one of the most internationalized cities in the world, with English as one of our official and commonly use languages. Our society is free and open, and our lifestyle is a blend of East and West.

Our currency, the Hong Kong dollars, is fully convertible. Capital from the Mainland, as well as from all over the world, flows freely in and out of Hong Kong. We have a simple and low tax regime. In fact, the tax rate in Hong Kong is one of the lowest in the world with the highest level of personal flat tax rate standing just at 15%.

We have the experience, the expertise and the connection to serve as the fundraising and financial hub for different economies. Only last month, we have been recognized by the Fraser Institute's as the freest economy in the world in its latest report on economic freedom. In fact, Hong Kong earns the same title in other similar reports such as Heritage Foundation's ranking and the Cato Institute's publication for example.

We also take pride in being China’s de facto international financial capital and that we are the first mover in Mainland’s continuing economic reforms. Hong Kong is also the world’s largest offshore Renminbi business centre.

Furthermore, Hong Kong has also been keen to explore Islamic Financial Services. Over the past few years, we have successfully issued three global sukuk, or Islamic bonds, which hopefully provided momentum for further growth of the sukuk market in Hong Kong and attract more issuers and investors to participate in our bond market.

All in all, Hong Kong has a good story to tell. Being an international financial center, we consider that we are also well-positioned to contribute towards the Belt and Road initiative which brings me to this interesting topic. So please allow me to spare a few minutes to briefly introduce this initiative.

Belt and Road

The Belt and Road strategy encourages closer economic as well as cultural co-operation among some 60-plus economies, particularly those emerging economies spanning Asia, Middle East, Europe and Africa. Belt and Road is, in essence, an invitation to the international community to join hands to take global and regional co-operation to new heights, in particular in terms of enhancing policy co-ordination, strengthening infrastructural facilities connectivity, facilitating unimpeded trade and investment, deepening financial integration and building people-to-people bonds.

We believe the Belt and Road initiative will be a driving force of the global economy in the 21st century. It will generate demand and expand international trade and investment flow, and it is also about making connections.

Hong Kong is well-placed to play a facilitating role, largely because of the unique advantages I mentioned earlier. We also have unique physical and intangible connectivity to the Mainland with privileged trade and social access. In addition, our well-established system 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.

Besides, the Belt and Road initiative will also catalyze the movement of people and goods, boosting demand for reliable logistics services. In this, Hong Kong is also well placed to serve. Our airport has been the busiest cargo airport in the world for more than 15 years. From Hong Kong, you can reach half the world's population in five hours. There are direct flights connecting Hong Kong to both Jakarta and Jakarta in less than five hours.

Indonesia, being in the critical gateway in the Maritime Silk Road will be a key player in the Belt and Road initiative. With the big-ticket infrastructural development, from highways and railways to maritime and aviation transport being rolled out by the Government here, there is real synergy with the Belt and Road initiative. Hong Kong will have a lot to offer and expertise to share when it comes to international co-operation on infrastructural projects envisaged under the Belt and Road.

This is because we have a deep pool of talented professionals, from engineers and surveyors to architects, designers and planners, not to mention other professionals specialized in financing, insurance, arbitration, risk management and project consulting. All of them are experienced and eager to partner with overseas businesses, to take part in the development, management and operation of infrastructural projects. We believe there would be many areas we can work together and there is much our economies could accomplish. In fact, one of the prime example of Hong Kong’s professional services involvement in the Belt and Road Initiative is right here in Bandung where the Hong Kong Branch of an international consultancy is providing the overall planning, architectural design, traffic flow and other consultancy services for the Jakarta–Bandung High-speed Railway.

Looking Ahead

In conclusion, I will invite all of you to consider Hong Kong as your first choice in seeking partnership to expand regionally or internationally, whether it is for capitalization or setting up offices. I would also recommend to you our professional services which cover a wide-range of talents from engineers to accountants to legal experts, all with ample international exposure as well as knowledge of working locally in Asia. For our part, the Jakarta office will do our utmost to promote Hong Kong to our friends in Indonesia and ASEAN and vice-versa to establish closer ties between us.

I would love to learn more about Indonesia and in particularly Bandung from you all. So, please share with me any insights you have on how Hong Kong and Bandung can work closer together.

Finally, I would like to thank our good partner, HKTDC, for organizing this seminar. I am sure this is a promising beginning of a closer relation between Hong Kong and Bandung.

Thank you. Terima Kasih!

Ends/Thursday, October 5, 2017