For the most accurate assessment of Hong Kong as Asia's business platform, who is more of an expert than the man who helped set up over 200 hundred foreign companies there just last year? Mike Rowse, Director-General of Invest Hong Kong, will tell you that regardless of the nature of your business, Hong Kong is the ideal hub for locating or expanding a regional base - and he will have the inside statistics to back it up. As part of a nationwide program promoting Hong Kong as the "Engine of Growth and Risk Manager for China," Rowse was the featured speaker at a complimentary luncheon held by the HKASC, in conjunction with the Hong Kong Economic and Trade Office in San Francisco, at the Marriott Newport Beach Hotel & Spa on February 23.

Invest Hong Kong is an HKSAR government department that provides comprehensive inward investment support services for those seeking to do business in China and Asia via Hong Kong, and Mike Rowse has been Director-General since 2000. Rowse began his presentation with an overview of the Chinese and Hong Kong economies and offered projections for future development. An often overlooked aspect of Deng Xiaoping's economic reform program, noted Rowse, is his then radical assertion that it was acceptable for some to prosper ahead of others. As such, the Chinese economy has steadfastly followed an upward growth path since the late 1970s, and it is set to overtake France as the fifth largest economy in the world.

Yet a fundamental question remains for global observers: Is China a threat or an opportunity? Taken in conjunction with Hong Kong, the optimum business platform for the Asia Pacific, Rowse sees China as both opportune and essential in developing a successful business strategy in the region. Hong Kong's position is vital as it 1) serves as the nucleus of Asia Pacific markets, 2) remains the base for access to and management of operations in the mainland and 3) acts as the jumping-off point for the south China hinterland. With the divergence of manufacturing and value-added service sectors into south China and Hong Kong, respectively, the two are joined in a complementary relationship that benefits from Hong Kong know-how in areas such as promotion, management and technological development.

The recent passage of CEPA III further enhances Hong Kong's position as the most advantageous entry point for the China market. Hong Kong already possesses the highest level of foreign direct investment and a large proportion of foreign-owned firms in the Asia Pacific region. CEPA III, an expansion on the existing Closer Economic Partnership Agreement initially signed between China and Hong Kong in 2003, increases the number of areas in which Hong Kong-based companies and Hong Kong products are given preferential treatment in the mainland. Under CEPA III, Hong Kong-based companies are also given privileged access to mainland markets in select service sectors, such as financial services and logistics. Taken as a whole, CEPA provisions make doing business in China via Hong Kong less capital-intensive, and more straightforward and advantageous.

The rapid economic development in China as of late is not without its challenges. Rowse addressed questions regarding regional disparity (wealth will eventually spread beyond urban centers), overpopulation (pollution and resource distribution are related issues the state will have to resolve), currency (China will ease restrictions on the RMB at a pace that suits its developing economy) as well as intellectual property rights (Hong Kong can be used a platform for enforcement). He concluded, however, that Hong Kong is the location from which troubleshooting, development and expansion can simultaneously be done, and with the research and facilitation solutions provided by Invest Hong Kong, any business can benefit from a China strategy rooted in Hong Kong expertise.