The Tenth Joint Meeting of Taiwan-Britain Business Council

EDITION 5, JULY 08 News Letter for the Pacific Rim, Hong Kong & Selected South East Asia Markets

The purpose of this newsletter is to alert UK business to what UKTI sees as the main headlines in the Pacific Rim, South East Asia & Hong Kong. It is meant to be no more than a snapshot. To go to a chapter – Click on heading, press `Ctrl’, then left click.

Feedback, comments and contributions to the UKTI strategy are always welcomed. Further information on any of these subjects is also available.

Singapore –SBBC Plenary 12 September & ABHI Healthcare Mission 16 September.

Hong Kong & Macao –Economy; Competition Law; Grentech; Construction of light Metro

Vietnam

Secretary of State is accompanied by Professor Chau at Hanoi Foreign Trade University

John Hutton MP, Secretary of State for Business Enterprise and Regulatory

Reform, visited Vietnam from 2-3 June. This was an immediate follow up to the business focussed visit to the UK of Prime Minister Dung in March 2008. John Hutton is the most senior Trade Minister ever to visit Vietnam. During the visit, the key meeting was with Prime Minister Dung which gave the UK the opportunity to urge Vietnam to make rapid progress on the commercial agreements made during Prime Minister Dung’s visit. Mr Hutton also addressed the Hanoi Foreign Trade University at which an eager audience vigorously debated issues such as globalisation and demonstrated more than anything else that Vietnam’s medium-long term prospects are very bright.

Recent media reports suggest that; with inflation at close to 20%, stock market and property prices weakening, Vietnam is expecting a slow down. However, most business commentators, while accepting the administration is facing a challenging period, do not expect business conditions to worsen. Policies are being established to tackle these issues and future e.bulletins will report on their effectiveness

Taiwan

The Taiwan British Business Council (TBBC) undertook a series of site visits culminating in their annual plenary over 16/17 June in Edinburgh & Lothian. The sector focus was ICT/Telecomms, Regeneration & Renewables & Financial Services. The 45-strong Taiwanese business delegation was led by TBBC Co-Chair Leslie Koo and Vice Minister Hsieh. Over the 2 days the delegation met with approximately 30 UK companies. Guests of Honour at the Edinburgh Castle reception & the Plenary sessions at City Chambers included Lord Steel of Aikwood, Edinburgh’s Lord Provost (Rt Hon George Grubb) and Councillor Tom Buchannon.

The event was considered a great success and Co-Chairs Sir Thomas Harris & Leslie Koo (who was presented with an Honorary OBE) are keen to keep the momentum and gain maximum value from the event. The Co-Chairs’ joint letter – copy attached - addressed to the respective Trade Ministers, highlights the key points that came out of the events including market access issues & Scottish expertise in the sectors of focus.

TBBC & UKTI will now seek to identify the tangible outcomes of the plenary in parallel with the ongoing work of the UK Steering Committee – specifically with regard to`Business to Business’ and `Business to Government’ activity. A copy of the full itinerary will be available shortly on the TBBC website (link under `URLs’).

Indonesia

As with other countries, Indonesia is dealing with rising fuel costs and inflation. In a recent statement, the Central Bank did not exclude the possibility that inflation could rise to 12.5%, up from early this year's forecast of 6%. To tackle this the Central Bank has increased the interest rate by 25 bps to 8.5% on 5 June 2008. Analysts suggest that the duration of the impact of the recent fuel price increase will be around 6 months (or even less) and Indonesia will deliver on its projected growth rate of 6.3%.

A sign of slower, but continued, growth is in the automotive sector where year on year sales are expected to increase by 15%, compared to 36% last year.

The Oil and Gas sector continues to thrive with projected exploration running into tens of billions of dollars. As a market that is a little over an hour from Singapore, UK business representing the supply industry may wish to consider Indonesia.

Korea

Two issues dominate, one more positive than the other. The EU Korea Free Trade Agreement negotiation continue at pace with meetings taking place at expert level. Both sides are aiming to conclude the agreement by end 2008. For the US Korea Free Trade Agreement, demonstrations on the streets of Seoul have led to Korea diluting its offer in relation to US beef. The real significance of this to UK business is that the radical election promises from President Lee relating to liberalising and deregulating the Korea Economy are unlikely to be driven forward at pace. For the time being Korea will still be a major and dynamic market but not the North Asia Singapore to which it aspires.

The Executive Training Programme (ETP) in Korea is an intensive 12 month professional development programme during which offers the opportunity to learn to communicate, to appreciate their cultures and to successfully develop your business. With 24000 Euro funding from the European commission ETP is a unique tool designed to provide EU companies with the latest, most insightful and advanced knowledge of the Korean economy.
For more information contact the London Chamber of Commerce (national coordinator) on 020 7203 1949 or visit the website on www.etp.org.

Singapore

The Singapore British Business Council’s 17TH plenary will take place in Singapore, 12th September. This is preceeded by a welcome reception on the 11th. The venue will be confirmed shortly. Following on from the plenary a UKTI/ABHI-led healthcare mission will host a seminar & a series of meetings with a targeted Singaporean audience on 16 September. The 3 core themes will be E-Health, Infection Control & Innovative Technologies. This has been timed to follow the SBBC event & pre-empt the Hospimedica Exhibition at which some of the delegation will be exhibiting. UKTI & ABHI are now recruiting UK companies and are working with SBBC & the British High Commission on the most effective format for the event. Interested parties should contact Parminder Sunda 020 7215 4869; Parminder.sunda@uktradeinvest.gov.uk

Malaysia

The Hon. Dato’ Sri Mohd. Najib Tun Abdul Razak Deputy Prime Minister of Malaysia visited the UK on the 9th and 10th June. Alderman David Lewis, the Lord Mayor of the City of London hosted a financial services lunch and UK Trade and Investment's Special Representative HRH The Duke of York hosted tea. In addition the DPM delivered address at Chatham House (Royal Institute of International Affairs) to a packed audience.

Hong Kong

Newly released figures show higher than expected Q1 2008 GDP growth of 7.1%, showing that HK’s strong fundamentals continue to help it resist a global downturn. The financial services, trading and logistics sectors, together with domestic consumption are key drivers of HK’s overall economic growth. Externally, strong Mainland demand and further expansion of the EU market have supported export growth of 8.3%. The financial sector boom and tourism have boosted growth of HK’s service exports by 10.8%. Domestically, consumption remains strong, with Private Consumption Expenditure (PCE) recording stable growth of 7.9% in Q1 08. Retail sales continue to perform well with strong consumer confidence, with growth in April standing at 18.7%. Looking ahead, solid domestic consumption and vibrant markets in emerging economies, especially China, are believed to provide some cushioning effect to the global slowdown. The Governments GDP forecast of 4-5% earlier this year remains unchanged.

In May 2008 the Government launched the public consultation on HK’s first competition law. Public responses generally welcome the proposed law as most think that HK’s supermarket chains, fuel stations, and land sales are areas where would-be competition has been prevented. It is hoped that the law will give the government new powers to investigate and award pecuniary penalties. However there are some areas of concern to businesses. The government has exempted all Government owned and statutory bodies, including public utilities & transportation. In addition, anti-competitive agreements where economic benefits outweigh potential harm are also being exempted. Despite these issues, the Government hopes to introduce the Bill to LegCo in the 2008-09 legislative session with an aim to pass the bill before 2012.

In the Hong Kong SAR’s Policy Address 2007 the Chief Executive announced a strategy for Hong Kong to become a centre for Islamic bonds and other Shariah-compliant financial products. Over the past few months we have seen initiatives including the launch of the first Islamic China Index Fund (by Hang Seng Bank) and plans for an Islamic bond to be issued by Hong Kong enterprises (the Hong Kong Airport Authority - yet to be approved).

In this context, The City of London, UK Trade & Investment and the British Consulate-General in Hong Kong are jointly hosting a seminar, "Building a vibrant Islamic Finance Market in Hong Kong on 7 July 2008, with a view to highlighting the strengths of the City of London, its financial institutions and its practitioners in developing a key Islamic financial industry. Led by the Lord Mayor of the City of London, there will be a panel of speakers with a wealth of knowledge and expertise in Islamic finance from the banking, capital market, tax planning and professional education sectors. A Hong Kong Monetary Authority representative will also give an update on the local market. The event is being supported by the Hong Kong-UK Business Partnership and the Chartered Institute of Management Accountants (CIMA). Relevant Continuing Professional Development (CPD) points will be credited to CIMA members who attend.

GreenTech Expo 2008 will be held between 17-19 September 2008 at the Shenzhen Convention & Exhibition Centre, Shenzhen, People's Republic of China. This trade fair promotes environmental protection for businesses in the Pearl River Delta (PRD) Region of Southern China (including Macao and Hong Kong). The organisers are looking for UK companies to exhibit at the trade fair or to speak at the forum that aims at helping businesses in Southern China address environmental problems arising from the vast economic growth in the region. This would be a useful opportunity for UK supplier of environmental technology and services, and new innovative solutions, to promote their products and UK expertise. Please visit the website http://www.greentech-exhibition.com for details.

Construction of an elevated Light Metro in Macao to tackle traffic problems in Macao

The Macao SAR Government has plans to build a 22 km elevated light metro with a capital cost of £270 million to solve the city’s worsening traffic problems.

A revised “optimisation plan” for the light metro is now undergoing a 45-day public consultation. A proposed first phase 20 km, 23 station elevated light metro system to be built on a track supported by giant stilts high above street level- a low cost and technologically simple solution suitable for Macao’s specific geological and urban development conditions. The driver-less trains will be run on rubber tyres and equipped with an automatic train control system. Each train will comprise 4 carriages (30 m length) with max.8000 passengers per hour. Target opening in 2011. Two bids for the project management and technical assistance services consultancy tenders have been qualified in April 2008.

General items of Interest:

UKTI’s website – includes trade opportunities, exhibitions, recent successes and trade briefs, by market. https://www.uktradeinvest.gov.uk/

TBBC website – 10th plenary page - http://www.tbbc.org.tw/html_e/e_tenthmeeting/

Email mike.qureshi@uktradeinvest.gov.uk with your questions about UK Trade & Investment activity

Your suggestions for content or themes to appear in the next edition are welcomed. Email mike.qureshi@uktradeinvest.gov.uk
If you do not currently receive this bulletin and would like to do so, please email mike.qureshi@uktradeinvest.gov.uk with “Subscribe” in the subject line.

Vietnam

Taiwan

Indonesia

Korea

Singapore

Malaysia

Hong Kong

General items of Interest: