The World SME (small and medium enterprise) Expo was held last month at the Hong Kong Convention and Exhibition Centre. A Greater China SME Forum - Hong Kong-Zhuhai-Macao Bridge (HZMB) Business Opportunities ran concurrently. I was one of the speakers at the forum.

There were also specialists from diverse fields sharing how the HZMB can bring business opportunities to their industries. As a representative of the Chinese Manufacturers' Association of Hong Kong, my focus was opportunities for SMEs and manufacturers.

Since the start of the HZMB project, experts have suggested that the SAR government seize the opportunity to develop a "bridgehead economy" - including building hotels and malls with shopping, catering and entertainment facilities. This is in order to expand tourism in Hong Kong. The government has responded by proposing a feasibility study on developing an artificial island. Originally it had been anticipated that this should only be a checkpoint.

Hopefully, if it is built, the HZMB development will take advantage of its proximity to Hong Kong International Airport to attract more tourists from the western Pearl River Delta area.

This could potentially alleviate the heavy flow of downtown tourists in Hong Kong and provide economic benefits to Lantau Island and the Northwest New Territories.

These are reasonable but long-term expectations. Following the completion of HZMB it will take time to accomplish such a comprehensive development project. Therefore this is not the immediate solution for the current problems faced by SMEs and manufacturers. To maximize the opportunities presented by the HZMB, I believe the most efficient approach would be to promote Hong Kong's wholesale industries, as promised by the Chief Executive in his manifesto.

Personally, I believe Cheung Sha Wan would be ideal for a pilot wholesale market for the garment industry. It is common knowledge that Hong Kong's manufacturing industry, including its clothing industry, moved to the mainland long ago. The division of labor - production on the mainland and design, export and sale in Hong Kong - has been quite stable.

Although Hong Kong's import and export trade and retail industry remain vital, the wholesale industry has always been limited. The reason for its limited developed is a lack of interest from the government and the need for improved transport facilities.

The opening of the HZMB in 2017 will greatly shorten the travelling distance between Hong Kong and western Guangdong. This will facilitate more versatile product supply routes than have been possible to date. The traditional source of goods to Hong Kong for the apparel industry, for example, is Humen town in Dongguan. But Shaxi town in Zhongshan is a famous production base for leisure clothing. The advent of the HZMB, therefore, will make it more convenient to transport goods from Shaxi to Cheung Sha Wan.

Hong Kong is generally seen as an ideal place for the further developments of wholesale markets. It enjoys large supplies of quality products from the mainland, has an excellent legal system and business expertise together with an extremely convenient transportation network and so forth. But with the HZMB, Hong Kong could become an outstanding wholesale and distribution center for many different products. As well as apparel in Cheung Sha Wan, some areas have considerable potential for development as wholesale markets. For example, Hung Hom could develop a jewelry market; Sham Shui Po could become a center for electronic goods; miscellaneous goods could be assembled in Kwun Tong; and Wong Chuk Hang could become a furnishing center.

The Census and Statistic Department has revealed that the average monthly export of items of apparel and accessories is about HK$15 billion. If a wholesale market were successfully established, the estimated growth in exports would be approximately 20 percent. The excess HK$3 billion would be able to support many people in society.

If the government were to start cooperating with business sectors and SMEs to actively develop wholesale business in Hong Kong, then by the time the HZMB opened, enormous economic benefits would be generated.

(HK Edition 01/13/2015 page1)