B.C. small business operators are hoping to benefit from increasing economic ties between Canada and China's Guangdong province and Hong Kong.

A recent one-day Guangdong-Hong Kong Forum in Canada 2005 at Vancouver's Pan Pacific Hotel attracted almost 1,400 people, including government and business leaders, a Chinese delegation of some 500, and small-business operators.

The event - hosted by the Vancouver Board of Trade in conjunction with Industry Canada, the province, the Chinese consulate in Vancouver, the Asia-Pacific Foundation, and several other organizations - was reminiscent of Chinese President Hu Jintao's recent state visit to B.C.

Premier Gordon Campbell and federal Industry Minister David Emerson welcomed Guangdong Gov. Huang Huahua and Hong Kong chief executive Donald Tsang and 25 new trade contracts worth $480 involving 22 Canadian companies were signed.

Bayne Stanley, Business Edge
Brand Concepts VP Greg Lui says government can help small businesses by 'opening doors.'

But most event participants were B.C. small-business operators who are calling for more help from government in establishing trade ties with the world's largest country.

"The big corporations in Canada, they know the way to go there and they have started already," says Eric Kong, vice-president of marketing for Vancouver-based CML Industries Corp., which exports building materials to Hong Kong and other parts of China.

"But helping the medium and small-sized (company) is very important. They had the reports (during the forum) from CAE and Sierra Wireless (executives who touted their successes in Guangdong and pledged to do more business there). They are big companies. But helping Canada to step out to China (means) helping medium and smaller-sized companies."

Kong, who emigrated to Canada eight years ago from Hong Kong, says it's easier for Chinese and "Hong Kong-ese" businesses to develop ties with B.C. and other parts of Canada because B.C. and other Canadian-based operators speak the same language and have experience doing business in China. But small firms need help understanding Chinese markets.

"The B.C. government and the federal government have to do more research and inject more money (to small business) for exploring the market in China," says Kong. "I can tell, for the next 10-20 years, the (building-materials) market will keep going, especially in China, so there's a lot of business opportunities.

"Right now, we're talking about Guangdong. Even the coastal ports in China are very important right now because, in China (people) spend money."

Chinese companies are also investing in other countries, he adds.

Canada established trade ties with China more than a decade ago, but the growth of business between the two countries has been "too slow," says Kong.

"A lot of our Canadian local companies, they don't know the markets in China," says Kong.

The province's Small-Business Ministry did have a presence at the forum as representatives operated a booth and handed out materials designed to help smaller companies export products to China. Earlier this month, the ministry operated a seminar on how to deal with China for the agriculture sector, but small companies hope more can be done to increase their trade opportunities.

The provincial government and Ottawa have set their sights on developing trade with the Guangdong region and Hong Kong because many Chinese-Canadian business operators have personal or family ties to the region, which is known as the Pearl River Delta and includes Macao.

Located on the southern tip of mainland China, Guangdong includes the capital of Guangzhou, formerly known as Canton, which is Vancouver's sister Chinese city. Guangdong leads the country in "economic capacity" and foreign trade, says a backgrounder provided by Invest Hong Kong and the Department of Foreign Trade and Economic Co-operation of Guangdong Province. Last year, Guangdong's GDP grew 14.2 per cent to $194 billion US, or 11 per cent of China's total GDP, while retail sales reached $77 billion US.

Meanwhile, Canadian firms contracted to invest $1.22 billion in Guangdong last year and the "actual input" reached $650 million.

Canada-Hong Kong trade totalled $4.3 billion US last year. More than 150 Canadian companies have offices in Hong Kong.

Greg Lui, vice-president of marketing for Burnaby-based Brand Concepts - which imports gourmet foods, primarily teas, from Guangdong and other parts of China - says Vancouver-area small-business operators with Chinese origins have wanted Canada to develop closer ties with Guangdong for many years. But local operators have been too busy to lobby Ottawa and Victoria.

He called on the provincial and federal governments to host more missions like the forum and make them open to small business.

"It helps a lot, having that safety," says Lui. "Even if it's not legislative or anything, (the government support) just creates an aura of confidence within both (Canadian and Chinese) parties. Sometimes, that's all we need. It doesn't have to be any signed legislation or government contract."

Governments, he says, can help companies that are not well established overseas, or do not have a special brand, make inroads in China - but Ottawa and Victoria do not have to do much more.

"Opening doors is more important than anything else," says Lui.

Lui says his company feels "safe" seeking out Chinese products that it can sell in North America, but selling North American products in China requires inside or local knowledge "because we can just imagine they'd buy in, but that doesn't mean reality is the same."

Wendy Tang, president of Vancouver-based Kumquat Enterprise Ltd., who operates a flower shop, says she does not believe small businesses face a disadvantage when dealing with China. She says her company has little trouble getting artificial flowers and other products from China - and her suppliers are mostly small companies.

Like many attendees, she came to the conference to network with potential partners and clients.

"Before, I was in China for many years and I know Guang is a very good province, so I figured I should grasp this chance," says Tang, who opened her flower shop in February.

Tang emigrated to Vancouver two years ago from China's Chong Quing province. She is a client of SUCCESS, a Vancouver-based agency which helps Chinese immigrants assimilate and start new business ventures in B.C.

Fay Wu, business development manager for SUCCESS, says the province and Ottawa must do more than focus on "just a sisterhood or brotherhood among the governments."

Governments should help develop multi-level trade relationships and help organizations at lower end of the pecking order.

"I think missions like this, outgoing and incoming missions like this, should be ongoing - not just (for groups) at the top level," says Wu.

She adds she attended the forum in search of "right matches" for her clients, and found several.

One of those clients is Michael Liu, who emigrated to Canada from China last year and was looking for opportunities to build ties between Canadian and Chinese colleges and universities.

Liu says Ottawa and Victoria should provide Sino-Canadian business opportunities for individuals as well as companies.

Kevin Stefura, marketing and sales manager for Canadian Heating Products Inc., which manufactures gas fireplaces, is hoping the forum will enable his Langley-based firm to develop more contacts in Guangdong, import more raw materials from there, and export more finished products.

"Over the last 12 months, we've substantially increased the amount of products that we've purchased from China," says Stefura. "Is that (increase) 10, 20 or 30 per cent? No. Is it 10? Most certainly. Is it 20? No."

Canadian Heating, which has approximately 130 employees at three manufacturing plants in Langley, Surrey and just across the border in Ferndale, Wash., has been importing goods from Guangdong for three years and exporting products there for two years. (The B.C. firm actually sells to Guangdong through an agent based in Los Angeles.)

Some 500 representatives from Hong Kong and Guangdong attended the forum. Stefura believes the forum will help B.C. businesses develop even closer ties with the region.

The company met contacts who had ties to the Chinese province.

"I think the relationship between the two countries and the two provinces is very strong and I think it's all going to get a lot better," says Stefura.

(Monte Stewart can be reached at monte@businessedge.ca)