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(Last updated: 6 Jan 2012)
Trends and opportunities
ICT business opportunities
Hong Kong has served as the gateway to Mainland China for more than a century. There is nowhere better than Hong Kong to obtain the expertise, information and facilities needed to tap into the immense Mainland Chinese market.
The Closer Economic Partnership Arrangement (CEPA), further provides Hong Kong with additional and exclusive Mainland market access benefits. Many international companies involved in China trade have chosen to establish their beachhead in Hong Kong.
China’s 12th 5-Year Plan has prioritised the development of seven industries including new-generation information technology and scientific R&D. The total value-added output of the new industries is expected to account for eight per cent of China’s GDP in 2015 and 15 per cent by 2020.
Overall, China’s software industry still lacks core technologies, high-end software development talent, and consistent high quality software products. Moreover, foreign brands enjoy a large market share in the high-end segment of the software market, with local software products comprising less than 30 per cent of the market.
The development of Hong Kong’s ICT industry also provides opportunities in a number of areas, which include the following:
- Banking, finance & insurance IT
- Telecommunications
- e-learning and digital content
- IT services
- Green technologies
Why is this market attractive for Australian companies?
Hong Kong is a truly international city and has a prime location at the geographical and economic centre of Asia which makes it an ideal place for new exporters to start their international businesses. The characteristics of the market are:
- World’s freest economy
- No language barrier (English is the official language)
- Level playing field for foreign businesses
- A market leader for new products in Asia
- Sophisticated, reliable banking system and stable currency
- Consistent import regulations and rule of law (IP protection, dispute resolution)
Hong Kong's role as Asia's leading logistics, communications and financial hub has made it a natural location for the development of a sophisticated IT infrastructure. Today it is home to most of the world's leading IT companies.
Foreign companies registered in Hong Kong will have distinct advantages in exploiting the huge potential in the Mainland where ambitious goals have been set for advancements in the areas of open source software, advanced wireless technologies and RFID. Hong Kong serves as a conduit to the Mainland market with established channels of cooperation in areas of innovation, technology and informatisation.
With the announcement on 17 August 2011, RMB investment will be added to the existing Foreign Direct Investment (FDI) scheme to allow flow back of RMB raised in Hong Kong to China. Under the arrangement, local and foreign firms in Hong Kong will be allowed to invest directly in substantive projects in the mainland in RMB such that they will be able to send RMB back to China without any foreign exchange losses under the FDI Scheme. These policies further support Hong Kong as a leading offshore RMB centre. Locally, the HKSAR Government's outsourcing initiative and the continued expansion of e-commerce will provide substantial opportunities. Locally, the HKSAR Government's outsourcing initiative and the continued expansion of e-commerce will provide substantial opportunities.
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