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Jewellers seize CEPA opportunities to expand Chinese Market

The Young Reporter (2004, April), 36(07), pp. 3.
Author: Sophia Degnegaad. Editor: Roby Lau Kam-wing.
Permanent URL - https://sys01.lib.hkbu.edu.hk/bujspa/purl.php?&did=bujspa0015375

By Sophia Degnegaad

03017826@hkbu.edu.hk

THE free trade arrangement between the Chinese mainland and Hong Kong, Closer Economic Partnership Arrangement (CEPA), increased jewellers’interest in the mainland market, according to a survey conducted during the Hong Kong International Jewellery Show in March.

The Trade Development Council (TDC) carried out a survey on various aspects of the jewellery industry and its market. Buyers and exhibitors were asked to describe their business under CEPA and expectations to the future.

The result shows that the jewellery trade is growing. 64 per cent of the exhibitors who are currently selling products to the mainland market are interested in expanding their business under CEPA. For those who have never sold to the mainland, 40 per cent of them want to start up soon.

JP Jewelry is among the 64 per cent exhibitors who are planning to expand their Chinese market.

“CEPA is the best gift the mainland could give Hong Kong’s business life,” said Dulcie Cheung, sales executive of JP Jewelry.

Mr Cheung’s boss has applied for a CEPA certificate, and was ready to take advantages of CEPA.

“As a result of CEPA, jewellery manufactures in Hong Kong can enjoy duty free access to the Chinese mainland,” said Charles Chan, president of the Jewellery & Jade Manufacturers Association.

It is estimated that the free tariff of CEPA will save Hong Kong $ 750 million each year, according to the Trade and Industry Department. To enjoy the benefits of CEPA, traders are obligated to apply for a free tariff certificate through the Trade and Industry Department.

CEPA includes more than just jewellery. 374 categories of ‘Made in Hong Kong’products will be exempted from tariffs when exported to the Chinese mainland. CEPA-qualified products include electrical products, plastic and paper articles, textile, clothing, cosmetics, clocks, watches, and jewellery.

Mr Chan explained that local manufacturers would benefit from CEPA because Hong Kong can compete with China on prices, product design and quality. He said that CEPA had raised overseas investors’interest in Hong Kong’s market as the city can offer an easy and cheap access to the Mainland market.

Phoebe Leung, sales & marketing executive in Classic Jewelry Company, thinks doing business in Mainland China is still difficult. “CEPA doesn’t solve all problems. It doesn’t ease the complicated tax system and local business laws conflicts in the Mainland,” Ms Leung commented.

Ms Leung is optimistic about the market outlook. “The fair is getting bigger and bigger, it’s good for business,” she said.

The research also found that more than three-quarters of the fair’s buyers and exhibitors expect business in 2004 to be better than last year. Only 66 per cent of respondents felt this way in 2003.

Mr Leung, Chairman of TDC’s Jewellery Advisory Committee shares the same view.

SARS is over, consumer confidence is up, and tourism is blooming in Hong Kong. So jewellery exports are expected to increase 10 per cent in 2004. Investors from Europe and the US are believed to expand business in Hong Kong and focus on CEPA-qualified products,” said Mr Leung.

To let both local and foreign business sectors know more about CEPA, the TDC has set up CEPA Business Service Centres in Hong Kong, Beijing, Shanghai, and Guangzhou in March to provide a one-stop resource for Hong Kong and mainland companies keen to capture business opportunities brought about by CEPA. The Centre also offers the latest news on CEPA, practical workshops, and a one-on-one advisory by mainland officials.

Edited by Roby Lau Kam-wing

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