By Michael Darch

Hong Kong’s position in Asia has undergone a significant shift over the past decade or two. Once a major manufacturing centre, most of that activity has shifted to the mainland. But Hong Kong remains the logistical and financial hub of Asia. Although its population is only 7 million, it is within 5 hours of half the population of the world - much like the relationship of Ottawa’s population to that of North America.

It remains a major centre for exports and has some 6,440 foreign companies, the Asian head quarters for many.

We got the usual talk on “Why do business with China through Hong Kong?”: strong legal framework, less risk, flexibility, world class infrastructure, low taxes and a solid banking and finance infrastructure. The quote used was “Do your business in Guangdong but sign your agreement in Hong Kong.” Interestingly, most of the conversation related to the Pearl River Delta (PRD), as opposed to China as a whole. The dynamics keep shifting.

But one statistic grabbed me and was clearly the best reason to look to Hong Kong if you are interested in the Chinese clean technology/energy market. Ownership of some 80,000 factories in China rests in Hong Kong. The factory may be in China, but the financial decision making is in Hong Kong.

The Hong Kong Productivity Council had another compelling reason. Last week they released the details of a new program to facilitate Hong Kong owned factories in the PRD to reduce air emissions and enhance energy efficiencies, the Cleaner Production Partnership Programme. This HK$93M program over 5 years helps fund improvement assessment, demonstration projects and verification of the effectiveness of projects, with most of the funds going to demonstration.

So, how did the team do in Hong Kong? First, we almost didn’t make it. Our 1 p.m. flight left the Beijing airport at close to 11 p.m. The new Beijing airport is beautiful, but after 12 hours, the excitement grows a little thin. At one time, it almost looked like the passengers were going to riot. Seeing the crew leave the airplane didn’t help.

Angry passengers in the Beijing Airport.

Picture this: 12 hours sitting in an airport, arriving at your hotel room around 3:30 a.m. and then getting on the Hong Kong subway right in the middle of morning rush hour. To us North Americans who demand our personal space, the Hong Kong subway during rush hour is not the place to be. There were five of us, and when the subway doors opened, no room for one of us never mind five. We were running late, so in we went. As I said, you had better like being very, very up-close and personal with what are now a hundred of your closest and most intimate friends.

Once again our China project manager Sophie Chen and our Consulate Office had got it right. We altered our format slightly to a briefing on the market, a roundtable discussion with some key local associations and senior executives and then a networking lunch session followed by one-on-one meetings. Both our universities and the three companies with us for our last stop were extremely pleased with the quality and relevance of the information and meetings. Once again expectations were far exceeded. This was not an exploratory mission, solid leads were qualified.

Ra’ed Arab trying to close a financing deal.

Yours truly checking out a potential OEM.

Tomorrow, home at last. I will admit, given the amount of snow this winter, we quickly checked home to make sure that it was really 22ºC and not snowing.

Is China serious about clean technology and clean energy? If this mission is any indication, you bet!

Thanks to all our partners in China for making this mission a success. Thanks to Foreign Affairs and International Trade Canada for their financial support through the Community Investment Support and Going Global Programs. Thanks to the University of Ottawa, Carleton University, Thermal Energy, Quadra Solar, CRTek, Canadian Windfields and Venture Coaches for joining us on the trip and making such a strong impression at every stop. Finally, I would like to thank Sophie Chen for putting this all together, suffering through planning with a 12 hour time difference and herding us to success on the road in China.

(Mike Darch is Executive Director of OCRI Global Marketing)