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| Chinese products in Brazil are popular for their quality and price |
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Hong Kong businesses in search of new markets abroad are being urged to cast their nets far and wide. A series of briefings last month by directors and senior consultants from the international offices of the Hong Kong Trade Development Council (HKTDC) highlighted some key markets with strong potential for Hong Kong businesses.
"Hong Kong's trade with Brazil has shot up 125 per cent since 2000," said HKTDC Brazil Consultant Marina Barros. She noted that electronics, textiles, watches and sunglasses are among the most popular items Brazil imports from Hong Kong.
"Chinese products are very popular in Brazil for their quality and price," Ms Barros said. China overtook the United States this year to become Brazil's largest trading partner. Ms Barros pointed out that, with the middle class constituting 75 per cent of Brazil's population of 199 million people, there are plenty of opportunities for Hong Kong companies to sell their products. Appliances, she said, should do especially well because of government subsidies to spur domestic spending.
Latin American Gateway
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| Colombia is Latin America's trade-fair centre |
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Other opportunities in South America can be found in such countries as Chile, Colombia and Peru, according to Alvaro Echeverria, the HKTDC consultant in Santiago. He said South American countries, which have not been directly hit by the global economic downturn, are expanding markets and are looking to boost trade ties with Asia. The region continues to be a major source of raw materials to the Asian market, including the Chinese mainland, which has signed free-trade agreements with Chile and Peru.
"Chile has an open and competitive market, with a highly developed retail industry, including supermarkets, chain stores and department stores," Mr Echeverria said. He noted that Chile, with a population of 16.8 million people, holds good opportunities for Hong Kong businesses in such industries as wine, agro-food, packaging, auto parts and accessories and audio-visual products and electronics.
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Retail is Vietnam's most
promising sector
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Another emerging market, Peru, has a clear open-market policy. As host of last year's Asia-Pacific Economic Cooperation meeting, the country's sights have been set on developing trade with Asia.
According to Mr Echeverria, Peru offers "excellent" business and investment opportunities, particularly in the retail, construction, machinery, houseware and office-equipment sectors, as well as the garment and textile industries.
Colombia, the largest Latin American market in the west-Pacific coast, is also a growing consumer market and looking to forge stronger trade ties with China. With more than one million small and medium-sized enterprises based in the country, Colombia is considered the trade-fair centre for Latin America. Economic reforms implemented since 2002 have resulted in strong growth, providing business opportunities for Hong Kong companies in such sectors as building and construction, manufacturing, energy, transportation and logistics.
Regional Opportunities
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HKTDC branch directors and consultants brief Hong Kong companies on global
market opportunities
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Closer to home, Vietnam, one of the world's best-performing countries in 2008, remains one of the most promising markets in Asia, according to Tina Phan, HKTDC Director for Indochina. The country is forecast to achieve five per cent GDP growth in 2009. While Vietnam's manufacturing sector has been hardest hit, retail is looking promising. Revenue from the sector totalled US$1.5 billion in the first quarter of this year, up more than 20 per cent, year on year. Since the beginning of the year, foreign companies have enjoyed full access to the local retail market in accordance with World Trade Organisation rules.
Ms Phan noted that, as part of the Vietnamese Government's stimulus package, it has introduced a US$1.6 billion tax break for enterprises and individuals to help boost investment and domestic consumption.
India, Asia's second-largest economy, also holds great promise for Hong Kong businesses. Private consumption of goods and services accounts for more than 50 per cent of its GDP, compared to 39 per cent in China and 70 per cent in the US, according to Loretta Wan, Regional Director for Southeast Asia and India. The country has achieved an average economic growth of eight per cent in the last few years, led by the private sector. With a 1.14 billion consumer base, and a growing middle class of more than 300 million people, India is a major market for basic goods.
"Indian consumers are very price and peer-conscious," Ms Wan noted. "Organised retail is growing very rapidly, with medium and small-sized cities fast-emerging as strong potential markets for lifestyle products," she said. But there are a number of considerations when entering the Indian retail market: "Local culture and traditions matter in selling," Ms Wan said. "‘Indianising' is very important."
