Hong Kong Economic and Trade Office, Washington DC
Hong Kong

Remarks of Eddie Mak
Hong Kong Commissioner to the United States
Chinese New Year reception
Washington, D.C.

February 13, 2019

 

Good evening everyone, Minister Li, friends of Hong Kong

Thank you for joining the Hong Kong Economic and Trade Office to celebrate the Chinese New Year of the Pig. Happy New Year, Kung Hei Fat Choi and Gong Xi Fa Cai!

I hope you enjoyed the energetic performance of our guest artist, Ms Fiona Foo. Thank you, Fiona.

This is my first Chinese New Year’s reception in Washington since taking up the post as Hong Kong Commissioner to the United States in July. I am no stranger to Washington having previously served as Director-General of our office some nine years ago.

During this festive season, we exchange greetings and reinforce bonds of friendship. It is good to see so many familiar faces and to welcome new friends to this beautiful space.

Last month my office welcomed a new colleague, Bryan Ha, who succeeded Kin-wai Law as Director of the office. Kin-Wai is now Director-General of our Jakarta office. I know that you will help us get Bryan settled in to his new home- away-from-home.

The past year has been a restless one. Global economic sentiment has been shaken. It is our hope that trade discord among our major trading partners can be resolved amicably. A protracted dispute presents significant challenges. The consequences for many economies, including Hong Kong, may be moderated growth and diminished financial results in 2018. Nevertheless, our economy is performing as well as can be expected given the uncertainties.

Our economy grew 3.7 percent in the first three quarters of 2018. Economic growth for 2018 as a whole is forecast at 3.2 percent. Our unemployment rate remains at a 20-year low of 2.8 percent.

Despite global economic uncertainty and the emergence of protectionist sentiment, Hong Kong remains a free trade practitioner and supporter of the multilateral trading system. Global trade tensions may have revealed that the world has taken for granted the importance of the multilateral trading system. We do not wish to see the marginalization of a system which has benefited so many in the world. Instead, this underscores the need to constantly update and enhance the system.

Thanks to our economic resilience and embrace of free market principles, Hong Kong has been ranked the world’s freest economy for 25 consecutive years by the Heritage Foundation. I would like to thank the Heritage Foundation for once again acknowledging our free trade credentials. Last month’s ranking recognizes our commitment to the rule of law, low tolerance for corruption, transparency and level playing field for all.

Well-before the emergence of recent trade tensions, Hong Kong has taken a multi-pronged approach to leverage the comparative advantages we enjoy under the “one country, two systems” arrangement and to diversify our economy.

Our corner of the world is home to fast-growing economies, such as member countries of ASEAN. Following our free trade agreement with ASEAN, we have successfully concluded FTA negotiations with Australia. We have also signaled our intention to start FTA negotiations with the Pacific Alliance and to join the Regional Comprehensive Economic Partnership when time is ripe.

China’s Belt and Road Initiative and the Guangdong-Hong Kong-Macao Greater Bay Area development also offer enormous trade, investment and commercial potential, particularly for American companies.

The infrastructure demands for the Belt and Road Initiative are far-reaching – offering opportunities for Hong Kong in project financing, risk-management and professional services.

The ambitious Greater Bay Area will enlarge our market catchment. The Bay Area, which covers Hong Kong, Macao and nine cities in Guangdong Province, encompasses a population of some 70 million people and a collective GDP of US$1.5 trillion.

Hong Kong is also looking within to maintain our competitiveness. We have set a goal to double gross domestic expenditure on R&D as a percentage of our GDP to about US$5.7 billion a year by the end of the current government’s five- year term of office.

One notable emerging sector is fintech. Fintech is a natural evolution for Hong Kong. Our financial regulatory framework encourages innovation while protecting consumers and the industry. There are over 300 fintech start-ups at our Cyberport and Hong Kong Science Park and over 150 other fintech companies are flourishing in private co-working spaces throughout the city. Fintech investment has grown from about US$108 million in 2015 to some US$546 million in 2017.

Hong Kong is an ideal platform for fintech and start-ups to raise funds given our status as the world’s leading IPO center. In 2018 the city raised some US$37 billion. In the past 10 years, Hong Kong topped the world in IPOs on six occasions. Consider, too, foreign direct investment. In 2017, global FDI inflow to Hong Kong totaled over US$100 billion, third in the world.

These developments have contributed to keeping Hong Kong as one of the world’s top three international financial centers alongside New York and London. Our stock market now boasts the world’s sixth largest capitalization at US$3.8 trillion, which is about 11 times our GDP.

Our door is always open to US investors and businesses. The city is ranked fourth globally on the ease of doing business in the World Bank’s “Doing Business 2019 Report.”

Hong Kong has long enjoyed a mutually beneficial partnership with the US. The US is Hong Kong’s second largest trading partner. Our city of 7.3 million people is the ninth largest goods export market of the US. In 2017, Hong Kong bought US$40 billion dollars of goods made in America.

Last year Hong Kong was the US’s third largest market for wine exports, fourth largest market for beef exports and sixth largest market for agricultural products.

Wherever I go in the US I am keen to emphasize that the US enjoys a US$35 billion goods and services trade surplus with Hong Kong, the largest among your trading partners. This is testimony to the mutual benefit of having a stable and seamless trade relationship between our economies.

US nationals represent one of the most significant foreign presences in Hong Kong. The US remains one of the largest sources of regional offices and regional headquarters in Hong Kong. The US accounts for one sixth of all foreign firms conducting regional operations from our city. Our government estimates that some 100,000 people in Hong Kong are employed by US firms. Disney reportedly employs 7,000 workers just as park cast members.

Notable developments include Google and Facebook jointly laying an 8,000- mile submarine cable between Los Angeles and Hong Kong. Once completed, it will be the highest-capacity route between the US and Asia. In addition, Amazon Web Services and Google Cloud Platform will join Microsoft Azure in setting up data center operations in Hong Kong.

Education and research are important areas for US-Hong Kong collaboration. In 2017, MIT opened its first-ever innovation node in Hong Kong. More recently the University of Chicago Booth School has set up an Asian base for its flagship EMBA program in Hong Kong while a MoU has been signed between Hong Kong University and Harvard University to set up a laboratory of instrumentation for precision medicine in the research cluster on healthcare technologies to be established in our Science Park.

Further strengthening our connectivity to the US, Cathay Pacific introduced a new direct service between Washington Dulles and Hong Kong.

Aside from our commercial relationship, Hong Kong values its partnership with the US in other areas such as law enforcement where we work together on counter-terrorism, maintaining strict export controls and combating money- laundering and drug-trafficking.

While there are many positive stories to tell of Hong Kong, we would not be complacent about the challenges we face – from pressures on our medical and welfare spending and affordable housing to the environment and the need for more effective public engagement. Hong Kong is not turning a blind eye to these issues. We are diligently working to address them for the benefit of our community.

As we look ahead to the New Year, there is much to be thankful for when it comes to the US-Hong Kong relationship. I hope that you will help us in working to further strengthen this important bilateral relationship.

I would now like to invite my colleagues on stage for a celebratory toast.

Thank you.

ENDs

 
     
 
Chinese New Year Reception Energizes Washington

Some 700 guests attended a celebratory Chinese New Year reception in Washington, DC organized by the Hong Kong Economic and Trade Office to celebrate the Year of the Pig. Speaking to the crowd, Eddie Mak, Hong Kong Commissioner to the United States, used the occasion to enrich US-Hong Kong bonds. The evening included a marimba performance by innovative Hong Kong artist, Fiona Foo, as well as an exuberant lion dance.



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