Date
26 September 2017
Vinai Thummalapally (right), along with commercial consul Marsha McDaniel (left), and consul general Clifford A. Hart Jr (middle) of the US Consulate in Hong Kong.
Vinai Thummalapally (right), along with commercial consul Marsha McDaniel (left), and consul general Clifford A. Hart Jr (middle) of the US Consulate in Hong Kong.

US makes fresh pitch to lure investors from Pearl River Delta

The United States is hoping to attract more investments from Hong Kong and China by launching a first-of-its-kind roadshow this week in various cities in the Pearl River Delta, a region well-known for its large pool of entrepreneurs and dynamic business environment.

“We hope to let our delegates understand what businesses the Chinese and Hong Kong investors are interested in, and to find out their needs,” Vinai Thummalapally, executive director of the International Trade Administration of the US Department of Commerce, said in Hong Kong Monday.

“During the trip, we can provide Chinese investors with data, putting them in touch with related organizations, and helping on embassy issues including rules and regulations or getting a visa,” he told reporters.

Consular officials will accompany a delegation of almost 70 representatives from public and private sector entities from 22 US cities, states and regions for discussions with Pearl River Delta companies. The delegation will stop at Hong Kong, Shenzhen, Shunde and Guangzhou from April 15 to April 18. Meanwhile, there will be more roadshows to other regions of China later this year and in 2015.

“Hong Kong is a good place to start with as 60 percent of the Chinese outbound investment comes to the city because the legal system is well-established there,” Thummalapally said. “Choosing Hong Kong and Pearl River Delta is mainly due to the level of economic activities, aside from the logistics efficiency,” he added.

The official said cumulative direct investment from Hong Kong to the US stands at US$9 billion, which is about one-third of that to US from China. “We are just scratching the surface,” he said.

Thummalapally didn’t give any figure as to the targeted investment during the roadshow, merely saying that “it is a win-win situation but not a zero-sum game.”

The delegation will target firms that are planning to enter the US market, as well as those that already have a presence there, he said.

“It would be good for the Chinese to invest in the US because they can be closer to the end-users,” Thummalapally said.

Meanwhile, Marsha McDaniel, commercial consul of the US Commercial Service at the American Consulate General in Hong Kong, pointed out to EJ Insight that the cost of doing business in the US is relatively cheaper.

Chinese businesspeople realize this, as evident from the nearly 500 companies that have registered to take part in the SelectUSA Pearl River Delta Roadshow, and the fact that China is the United States’ fastest-growing source of foreign direct investment.

“The land cost and energy cost in the US are very reasonable, and infrastructure support and sales channels are well established,” McDaniel said. “In addition, certain US regions offer economic incentives, such as tax credits, which are attractive to many investors.”

In 2013, China’s outbound direct investment to the US was at US$4.23 billion, doubling from a year earlier, while that from US to China grew 7.13 percent to US$3.35 billion, according to Chinese commerce ministry data.

– Contact the reporter at [email protected]

RC

Ayishah Ma is a financial reporter on Greater China issues.

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