Fast-growing cellular and wireless sectors are turning China into an attractive destination for Alberta high-tech companies looking for a toehold in the largest developing market in the world.
But small and medium-sized businesses wishing to sidestep a bureaucracy-bloated regime and a tangle of red tape on the mainland should look first to Hong Kong as a gateway, says Rosanna Ure, director of the Hong Kong Economic and Trade Office in Canada.
The office, an arm of the Hong Kong government which promotes Canadian investment in Hong Kong as well as facilitating trade negotiations with the federal government, is spearheading its first-ever trade mission to Hong Kong this November – and is looking for Alberta ICT and biotech-based companies to join the trip.
“People in Alberta have an entrepreneurial spirit. And they’re keen to look for markets outside the United States,” Ure told a group of local businesses at a seminar held at Calgary’s Alastair Ross Technology Centre last week.
“There are a lot of promising IT and biotech companies here – these are the companies that we’re targeting.”
China joined the World Trade Organization (WTO) last year, and while theoretically now open to foreign business, the country of 1.3 billion is still rife with complex regulations and corruption, says Ure.
Hong Kong is a former British colony which boasts freedoms of speech, press and assembly that are forbidden on the mainland.
But it’s a difficult market to penetrate even for Hong Kong businesses – despite sharing the same language and culture, they are still considered “foreign” investors and are subject to the same rules as Canadian businesses.
But the market remains lucrative. Some analysts predict China will become an economic powerhouse as the century unfolds and citizens grow increasingly affluent.
However, Ure says businesses stand a better chance in China if they partner with a Hong Kong counterpart who knows how the Chinese bureaucracy works and likely has an established network of contacts on the mainland.
“We have the capital and the experience. Canadian companies have the technology. The two married together will make a strong team,” she observed.
There are about 150 Canadian companies with branches or subsidiaries in Hong Kong – Canada’s 12th largest export market – including Manulife, Bombardier, and most major banks.
Calgary’s Zi Corp., has also made inroads into China with its core technology product eZiText, which connects people to short messaging, e-mail, e-commerce, web browsing and similar applications in more than 35 languages and regional dialects.
Major Canadian exports to Hong Kong include electrical machinery, apparatus and appliances and telecommunications equipment.
The trade mission this November 8-11 will bring together a group of Canadian companies wanting to explore a “fast-track” route into China through Hong Kong. While ICT and biotechnology companies are being targeted for the mission, financial and tourism/entertainment services are being courted as well.
Ure says the trip will pre-match businesses with specific contacts in Hong Kong before the trip to better the chance of sealing a deal or partnership.
