biz.hk Mar 2011

March 2011 Vol 43 No 03

Contents

Richard R Vuylsteke

Editor-in-Chief Daniel Kwan

Assistant Editor

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08

16

SPECIAL FEATURE

TOURISM

HUMAN RESOURCES

SPORTS & ENTERTAINMENT

Hong Kong’s retail industry has benefited from the sharp increase of Mainland tourists. How to capture the spending power of the Big Spenders is a new challenge to local retailers who struggle in a competitive market environment

Attendance for Ocean Park in February has been phenomenal thanks to the newly opened Aqua City. Paul Pei, Executive Director, Sales and Marketing of Ocean Park, outlines the park’s marketing strategy and its conservation message

The recent furor over the government’s proposed injection of $6,000 (later withdrawn) into individual MPF accounts has again focused attention on the fund’s effectiveness of a retirement safety net. Is it enough? What is the impact on business? And what issues policymakers should consider in perfecting the system?

The legendary king of football Pelé makes a whirlwind visit to Hong Kong in March to promote the newly-revived New York Cosmos.

He tells an enthusiastic audience at an AmCham luncheon about his experience as a professional football player and his new role in the American football club

Publisher

Kenny Lau

Advertising Sales Manager

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Regina Leung

biz.hk is a monthly magazine of news and views for management executives and members of the American Chamber of Commerce in Hong Kong.

Its contents are independent and do not necessarily reflect the views of officers, governors or members of the Chamber.

Advertising office 1904 Bank of America Tower, 12 Harcourt Rd, Central Hong Kong Tel: (852) 2530 6900 Fax: (852) 2537 1682 Email: amcham@amcham.org.hk Website: www.amcham.org.hk Printed by Green Production (overseas) Group 2A Sun Yip Street, Chai Wan, Hong Kong Designed by Overa Creative Co Rm A, 12/F, Sun Fai Comm Bldg, 576 Reclamation St, Mongkok ©The American Chamber of Commerce in Hong Kong, 2011 Library of Congress: LC 98-645652

AMCHAM NEWS AND VIEWS

14 Observing to Understand the Asian Shopping Experience

04 Chairman’s Memo Rob Chipman reports on the preparation of the 2011 Beijing Doorknock, touches on finances of the Chamber

07 New Business Contacts 19 executives joined AmCham’s business network last month

So what does the Asian consumer want? What turns the browser into a buyer? Jerry Gelsomino, Principal of FutureBest, analyzes the shopping behavior of Asian consumers, and points out areas foreign brands need to pay attention

TOURISM

37 Mark Your Calendar

16 Not Just an Aquarium, It’s a Brand New Experience Visitors jam the Ocean Park in February with the newly-opened Aqua City. Paul Pei, Executive Director, Sales and Marketing, talks about the park’s marketing strategy and its conservation message

SPECIAL FEATURE

08 Mainland Tourists Redefine Hong Kong’s Retail Scene Local retail industry benefits from the remarkable increase of Mainland tourists over the past few years. The new visitors bring more than just cash, but tough challenges to retailers too

10 Targeting Consumers Oliver Rust, Managing Director of The Nielsen Company, explains the results of a survey on shopping preferences and motivation of Mainland tourists

HUMAN RESOURCES

24 Taking Pulse of MPF: Where Do We Stand and What’s in Store?

The Mandatory Provident Fund is 10 years old. What has it achieved, and what should be done to perfect the system

26 Heads in the Sand: Hong Kong’s Retirement Protection Policy Lam Woon-kwong, Chairperson of the Equal Opportunities Commission, addresses the Hong Kong Retirement Schemes Association last May in a luncheon and tells the audience what he finds the MPF lacking

28 Success, Family and Opportunities Ka Shi Lau, Managing Director of the Bank Consortium Trust Company, talks about success, career and opportunities for women

SPORTS & ENTERTAINMENT 30 Cosmos Is Back, So Is Pelé The king of football Pelé tells an enthusiastic audience at an AmCham luncheon about his experience as a professional football player and his new role in the American football club New York Cosmos

BUSINESS NETWORK 34 Taking a Closer Look at Our Members Interviews of two distinguished individuals who are having an impact in their respective industry

For comments, please send to biz.hk@amcham.org.hk Single copy price HK$50 Annual subscription HK$600/US$90

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Board of Governors Chairman Robert Chipman Vice Chairman James Sun Treasurer John Sigalos Executive Committee Frank Lavin, Anita Leung Belinda Lui, Charles Wellins Governors Brian Brenner, Tom Burns, Jacob Cefolia, Janet De Silva, Rob Glucksman, Peter Levesque, Charles Ma, Toby Marion, Ross Matthews, Andrea Richey, Catherine Scown, Leland Sun, Colin Tam, Elizabeth L Thomson, Richard Weisman, Frank Wong, Sara Yang Bosco, Shengman Zhang Ex-Officio Governor President

David L Cunningham Jr Richard R Vuylsteke

Chamber Committees AmCham Ball Apparel & Footwear Business Briefing China Business Communications & Marketing Corporate Responsibility

Kay Kutt Andre Leroy Don Meyer Wendy De Cruz

Energy Entrepreneurs/SME Environment Financial Services

Sean Purdie Donald Austin Bradley Punu Kuresh Sarjan Catherine Simmons Peter Johnston Hanif Kanji Ross Matthews

Food & Beverage Health & Wellness Hospitality & Tourism Human Resources

Susan Reingold Ed Ahnert

Noble Coker Peter Liu

Information Technology & Telecom Rex Engelking Intellectual Property Alvin Lee Law Eric Szweda Pharmaceutical Stephen Leung Real Estate Brian Brenner Senior Financial Forum Alvin Miyasato Senior HR Forum MaryAnn Vale Sports & Entertainment Ray Roessel Taxation Evan Blanco Trade & Investment Patrick Wu Transportation & Logistics Brian Miller Women of Influence Jennifer Van Dale Lee Georgs Young Professionals Roger Ngo

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香港美國商會中國商務專題研討會

赴美投資系列 Rob Chipman Chairman

Dear Members,

Chairman’s Memo

February and March were very busy indeed for AmCham and its wonderful staff, highlighted by the unforgettable lunch with soccer legend Pelé. Past Chairman Steve DeKrey conducted an informal chat with Pelé who could not have been more warm and gracious.

His personality perfectly matches his status as the greatest soccer player of all time, and the many kids in the audience will attest to that.

On a weightier note, we continue to forge ahead and make important progress in a number of key areas: Our Beijing Doorknock will take place from March 31 to April 1 and Vice-chairman James Sun will lead that mission. Preparations continue apace and I am confident this year’s Doorknock will be a big success.

In addition, our Finance committee, under the leadership of John Sigalos, is tackling challenging issues surrounding our financial health. I am glad to report that, although it is still early in the year, we are at or near our budget. Also, John has provided valuable input on strategic issues, in particular, the revamping of our overall approach to membership including attracting new members, and retaining and better servicing existing members who currently support AmCham.

You will see in this issue of biz.hk special feature stories on Mainland tourists and their impact on Hong Kong’s retail business. Mainland tourists have reshaped our retail landscape and how to capture their spending power is crucial to retailers and the hospitality business operators. Also included are interviews with Paul Pei, Executive Director, Sales and Marketing, of Ocean Park on the new Aqua City, and Anthony Lau, Executive Director of the Hong Kong Tourism Board, on the MICE and overall tourism market for 2011.

By the time you read this message, the first quarter of 2011 will be drawing to a close. The highlight for April is certainly our annual AmCham Ball on April 16. Be sure not to miss it and mark your calendars for that special evening. Get your tickets, organize your table, and prepare for a great time at the Four Seasons! I wish all of you continued success and I thank you for your support of the wonderful organization that is AmCham Hong Kong.

隨著中國經濟迅速發展，中國企業赴美投資的態勢不斷增強，中國第一能源、尚德電力、比亞迪、鞍鋼等大型企業都先後走出去，在美國設廠 投資。為了更有效的利用美商會會員之長，幫助中國有條件的中小企業瞭解和策劃如何“走出去”進行對外投資，美商會中國事務核心小組與 會員公司德勤國際稅務中心（亞太區）以及其法律夥伴合作，舉辦首個以普通話作為主要交流語言的赴美投資系列研討會，為有意赴美投資的 公司提供條件分析和投資前的基礎知識，當中包括赴美投資考慮、法律、財務和稅務、人力資源、公共關係、政府關係以及進退策略等。

2010年12月15日

赴美投資考慮綜述

2011年1月21日

美國併購

2011年3月中

赴美投資構建和融資（創建投資）

2011年5月初

赴美經營

2011年6月尾

赴美經營 － 初步瞭解（II）

2011年8月中

歸國或退出美國市場策略

－

費用：

初步瞭解（I）

100 港元

每節

（歡迎非會員參加） 費用包括研討會講義、茶點供應

歡迎媒體 歡迎任何有意赴美投資的人士參與，詳情請瀏覽香港美國商會中國事務部網頁

http://www.amcham.org.hk/index.php/China-Affairs.html Rob Chipman Chairman

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香港美國商會中國事務主任 張先生 電話：2530-6928 電郵：lcheong@amcham.org.hk

或聯絡

香港美國商會中國事務總監 羅女士 電話：2530-6915 電郵：dlo@amcham.org.hk

MEMBERS DIRECTORY 2010/2011

New

Business Contacts The following people are new AmCham members: American Democrats Abroad Hong Kong

w w w. a m c h a m . o r g . h k

Alexander Montgomery Vice Chair & Treasurer

Asian Tigers K C Dat Scott McMullin Business Development Manager

Avery Dennison Hong Kong B V Jessica Chan Senior Corporate Communications Manager, AP

CBI Consulting www.amc ham. org.hk

Daniel Neidlinger Assistant Manager

Chubb China Holdings Ltd

Over 500 pages in three major sections, including a complete guide to chamber services, corporate sponsors and AmCham Charitable Foundation. This directory lists nearly 1,900 members from over 700 companies and organizations.

ISBN 978-962-7422-03-7

LC 98-645651

Peter Stavroff Managing Director

Experian HK Ltd Russ Mathews Group Director - Consulting

Navigant Consulting Asia Ltd Yvonne Lee Regional Manager

Rockwell Automation International Holdings LLC Bob Ruff President, Asia Pacific

Rue Madame Ariane Zagury Founder

Sino Group Lawrence H P Law General Manager

Solar Exports Ltd Deepak Madnani Founder/ Managing Director

Sullivan & Cromwell LLP Michael Desombre Partner

Informatics Education (HK) Ltd Kenneth Mok Managing Director

Jones Day Jeffrey Maddox Partner

KWP HK Ltd Shawn Bruins Director Thomas Agius Director

Lister Swartz John Lo Partner Kenneth Choy Partner

Nature Conservancy Anson Wong Associate Director of Philanthropy

View our other members at:

http://www.amcham.org.hk/index.php/AmChamMembers.html

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SPECIAL FEATURE

Mainland Tourists

M

ainland tourist Wang Zheng has just swiped his Union Pay credit card at a watch chain store at Causeway Bay and turned around to lecture his companion.

“You are what you wear. So each man should have a right watch to identify himself,” he says.

The store manager was quick to echo from beside. “Definitely, our brand has all the right watches for men, too.”

Thirty-year-old Wang has just brought a lady’s watch for his girlfriend at the hefty price of HK$37,600 (US$4,825). Thoroughly gold-plated, the watch has 12 shining diamonds planted onto its dial plate.

Wang signed the bill and politely declined the manager’s offer to show him some of men’s choices.

“Not this time, but I will be back,” Wang says. He works for a Shanghai-based security company, which has handed out handsome year-end bonus for 2010.

Few retailers in Hong Kong would doubt what Wang said – yes, they will come back.

Redefine

Hong Kong’s Retail Scene

Booming to boomer

The influx of Mainland tourists has changed the retail industry in Hong Kong. They buy designer hand bags, cosmetics, jewelries, electronics, and in some cases even houses. Shopowners welcome them with open arms, and Putonghua skill is now a must for most salesmen and salesladies in all hospitality-related business. Guo Aibing talks to Mainland tourists who have come and fallen in love with shopping in Hong Kong as well as experts who analyze the impact Mainland visitors have on the industry

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Affluent customers from Mainland China have increasingly become the kind of cornerstone buyers in Hong Kong pushing the local retail industry, especially luxury goods sales such as watches and jewelry, from booming to boomer.

A latest research report released by consulting company Nielson in February shows that 22.7 million Mainland tourists visited Hong Kong in 2010 and each visitor spent on average of HK$12,000 per stay. A rough calculation would put Mainland visitors’ spending at HK$272 billion.

The report says Mainland tourists are usually well-educated and their earnings are generally above the Mainland’s average income.

About 80 percent of Mainland visitors come to Hong Kong in small groups of four or less, and spouses and children are usually core companions of such free-wheeling trips.

“Well-known as the Asian shopping paradise, Hong Kong provides an array of luxurious shops and malls, making Hong Kong one of the leading travel destinations in Asia for Mainland tourists,” says Troy Yang, Vice President, Consumer Research & BASES, The Nielsen Company Hong Kong.

“As many as 80 percent of Mainland tourists came to Hong Kong to shop for themselves, with clothing and electronic products as favorite purchases.”

The Nielsen’s survey reveals that over two-thirds (68 percent) of Mainland tourists planned their purchases before coming to Hong Kong, with females (65 percent) and those aged 34 and under (37 percent) as the most well-planned in terms of purchases.

More specifically, cosmetics and skincare products (61 percent) are the key planned purchase categories, followed by electronics/photographic products (52 percent), clothing (45 percent) and jewelry/watches (38 percent), indicating high-ticket items are the chief purchase targets for Mainland tourists.

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Taking over Despite some negative publicity about the conducts of tour guides in Hong Kong (see box), Mainland tourists continued to inundate the city during the seven-day Spring Festival or Chinese New Year holiday in February with as many as 660,000 arrivals. On February 7 alone, 120,000 Mainland tourists entered Hong Kong – setting a new record for visitor inflow.

It’s easy to locate large thongs of Mainland visitors in shopping centers in Causeway Bay, Tsimshatsui or Mongkok, holding large bags or pulling suitcases that contain their latest captures from their favorite boutiques, bazaars, and department stores.

For Harbor City, a shopping magnet in Tsimshatsui, hourly turnover reached HK$5.05 million last year. Analysts suggest that over 60 percent of those spending comes from Mainland tourists.

Percy Sum, sales executive of Emperor Watch and Jewelry store at Causeway Bay, says that about 80 to 90 percent of their watches are brought by Mainland tourists on a daily basis.

“In general, our watches are 28 percent cheaper than similar Mainland stores,” he says. “So even without special discount, our prices are already very attractive to Mainland visitors.”

Sum randomly picks a watch and quickly scripts down on a piece of paper his price, the Mainland retail price and how much one can save by shopping at his store.

“This is what I usually do when introducing our watches,” Sum says referring to his ‘cheaper-to-buy-here sales pitch’. “Many Mainland visitors buy watches for family members or friends, so I will make it perfectly clear how much they can save [if they buy in Hong Kong].”

Troy Yang

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For Frankie Chan of the well-known cosmetic chain-store Sasa in Causeway Bay, her Putonghua skill has seen huge improvement in the past couple of years as she deals with Mainland customers every day.

“I’d say at least 70 to 80 percent of our customers are from the Mainland,” she says. “They are our bread and butter.”

Chan and her colleagues are now used to the practice that some Mainland tourists would just simply hand them a shopping list, on which the names of a dozen or so cosmetics brands are included.

“We usually would recommend them replacements if some products [on the lists] are out of stock, and most people would take our suggestions seriously,” she says.

Zero Price Tours Hong Kong’s tour guide Li Hau-chun rocketed into spotlight in an unexpected way.

Last July, Li was videotaped by a member of her tour group from Anhui Province berating them for not spending enough on shopping in stores designated by her tourist agency.

The posting spread at lightning speed across the Mainland and Hong Kong and Li was accused of wrecking Hong Kong’s reputation as a model city of hospitality and shopping paradise. Embarrassed by the incident and desperate to repair the damage, the self-regulating Hong Kong Travel Industry Council stepped in and suspended Li’s tour guide license.

As overwhelming majority of critics pointed their fingers to Li’s sometimes discriminative attitude towards the Mainland tourists, the local media quickly unveiled an industry that had set up both Li and her clients for an easy conflict.

Li who had been a guide for eight years was serving a tourist group who paid zero fees to visit Hong Kong. The precondition was that they have to spend enough on shopping to make up for the tour fees. The “zero price tour” to Hong Kong has been in place for many years, but has not gained enough attention until Li’s case came into the public spotlight.

A trip to Hong Kong usually costs at least several thousand dollars. A “zero price tour” arrangement means that individual members must spend tens of thousands of dollars each on shopping so that the travel agents can earn enough commissions paid by the shops to cover the traveling and lodging expenses. The tour guides’ incomes are also based on the sales commissions.

The Travel Industry Council – which is mainly made up of travel agency executives – has since issued tougher guidelines for tour guides and their agencies in running local tours for Mainland tourists.

However, it does not ban the “zero price tour” arrangement.

Hong Kong’s retail industry is banking on Mainland tourists to support growth and cover high running costs. The Hong Kong Government is lobbying the Central government to add more inland cities to the Individual Travel Scheme to bring in more Mainland tourists.

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Sea change Visiting Hong Kong has not been an easy task for Mainland tourists until 2003, when the Mainland and Hong Kong governments signed the Individual Visit Scheme, which allowed Mainland visitors from rich east-coast cities to visit Hong Kong individually.

“It took me about two months to clear all the requirements just to get a visa to visit Hong Kong. It felt just like visiting a foreign country,” says 52-year-old Zheng Lishui, who first visited Hong Kong from Fujian’s Xiamen in 1993 to see his older sister in Hong Kong.

The procedure got a bit easier after 1997, but one still had to have a legitimate reason, such as visiting family relatives or for business, to visit Hong Kong individually.

“As far as I know, visiting Hong Kong for fun (individually) was still not an option,” Zheng recalls what it was like in 1997.

From 2003 on, all procedures were greatly simplified and individual traveling to Hong Kong has become a right rather than a privilege.

The policy gave a strong boost to Hong Kong’s retail industry instantly. The city’s consumption deficit in July 2003 was replaced by a HK$1.2 billion income in August, and a steady consumption growth has never looked back.

China had 6.5 million people visiting Hong Kong in 1997, and the number swiftly jumped to 13.6 million in 2006. The number reached 22.7 million in the past year.

Along with the increase in tourist numbers was the growth of China’s economy. The Mainland has seen around 10 percent yearly economic growth in the past decade, despite the interruption of the global financial crisis in 2008.

Meanwhile, China’s currency, Renminbi, has appreciated about 20 percent against US dollars since 2005, and analysts generally believe the value of the currency would keep rising given China’s huge trade surplus against the US and European Union.

China’s robust economic growth and strong currency have armed its citizens with ammunition to go on shopping sprees when they travel abroad and especially to Hong Kong where the currency is pegged to the US dollar.

Many Hong Kong retailers have put up clear signs on their windows welcoming Mainland shoppers who want to pay in Renminbi. In some cases, shop owners may even offer special discounts to Mainland tourists who pay in Renminbi as the currency is now more expensive than the Hong Kong dollar relative to the US greenback.

noodle cafes and electronic chain stores.

A unique phenomenon in Hong Kong is that pharmacies which target Mainland tourists who come to Hong Kong to load up their suitcases with infant formula and medicine have also taken up prominent retail space alongside jewelry shops in high traffic avenues such as Yee Wo Street in Causeway Bay. Another noticeable change is that thanks to the gradual introduction of Renminbi financial products – deposits, exchange and credit cards, and bonds – in Hong Kong, retailers now have multiple channels to invest or deposit their Renminbi income earned from Mainland tourists. The increase was most notable about a year ago when expectation of further appreciation of Renminbi ran high. According to the Hong Kong Monetary Authority, Hong Kong banks RMB315 billion by the end of 2010, up 400 percent from a year ago.

Hong Kong’s lure Besides economic and policy factors, Hong Kong’s international culture and retailers’ hospitality obviously have added score to the city’s shopping industry.

More and more shop attendants can speak fluent Putonghua to cater to their Mainland customers, while the shopping environment and store layouts in Hong Kong can rival the taste of high-end

Feng Xiangqing & Gu

Rent and income The sharp increase of Mainland tourists has led to at least two changes. First, rent of “golden egg” shopping areas such as The Park Lane Shopper’s Boulevard and Canton Road in Tsimshatsui has gone up sharply as luxury retailers compete for high-traffic shopping space. As a result big names jewelry shops like Chow Tai Fook, Luk Fook and Chow Sang Sang are crowded together on busy districts like the Nathan Road forcing out low-profit-margin retailers such as

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Lifan

shopping centers in New York and Paris.

Feng Xiangqing, 40, and her husband Gu Lifan, 39, have made the annual trip to Hong Kong during the seven-day Spring Festival holiday a hobby, even with the addition of their two-year-old son.

“It kills us to pull the baby-stroller around, but with him, this feels more like a real family trip,” Feng says.

Feng falls in love with Hong Kong because of the city’s wide selection of luxury handbags. She used to exhaust her and her husband’s credit card lines on luxury bags in earlier trips to Hong Kong, but more and more she started to enjoy a casual stroll in city parks or an afternoon trip to one of the city’s famous beaches.

Feng runs her own music school in Beijing and her husband works as a sales manager for an US-based pharmaceutical company.

“The more you come, the better you like the city,” Feng says.

“It’s not just about shopping, but more of an escape from our busy work and be able to relax.”

Both Feng’s family and Wang Zeng fit into a group of people, on which Nielson identifies in its research as most likely to travel individually to Hong Kong rather than joining organized group trips.

Conducted in the fourth quarter of 2010, the Neilson survey shows that mainland tourists to Hong Kong come from all regions across China and represent a fairly homogenous segment, as most are married and skew to the 25 to 44 age range.

“As many as 80 percent of Mainland tourists came to Hong Kong to shop for themselves, with clothing and electronic products as favorite purchases.”

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Targeting consumers The Nielsen Company conducted a face-to-face survey in the fourth quarter of 2010 to understand Mainland tourists’ purchase patterns and experience in Hong Kong. In addition, a telephone survey with 1,000 Hong Kong consumers aged 15–54 was conducted to understand their adaptation to the increasing number of mainland tourists locally. Oliver Rust, Managing Director of Nielsen, talks to biz.hk about the survey and how retailers can win these ‘big spenders’ over biz.hk: Why Mainland tourists favor Hong Kong as their shopping destination?

Rust: There are fundamentally three main reasons. One is that there is no VAT (value-added tax) in Hong Kong and that certainly makes Hong Kong attractive. The second is that Hong Kong is often perceived by a number of brands as a gateway to Asia in terms of brand positioning, because of types of customers who are already here, and the perceptions they create vibrate around the region.

With that comes the notion of the range portfolios the brands have.

Not only the number of brands that are present here, but even within the brands, the number of ranges they have is very advanced and [it’s] a very sophisticated market in that sense. So if you look at the jewelry, durable goods, you have all the major brands here and they have a full-blown range. That’s another positive impact.

The other area is how Hong Kong’s retail environment has adapted to provide a one-stop shop shopping experience for the consumers from China – be that in, for example, Central like The Landmark, The Prince Building, or the Times Square or Harbor City. All these one-stop destinations provide an opportunity for the customers to do all their shopping in a very convenient way.

The fact the Chinese currency Renminbi is much stronger than the Hong Kong dollar also makes Hong Kong an attractive destination. biz.hk: Are we making full use of our strengths?

Rust: Hong Kong has done a very good job in attracting the Mainland tourists. You look at the number of Mainland tourists over the last four or five years, you will see the numbers escalate exponentially.

There’s a perception that we need to do more to create a shopping environment that’s much more targeted and engaging with the Mainland tourists especially in terms of what items they are buying – they are high-value-ticket items. Hong Kong needs to maintain its position and communicate the benefits of coming to Hong Kong. As you can imagine on the high-value-ticket items, there is a big concern among shoppers and Mainland tourists about the quality and the genuineness of the products.

Hong Kong needs to promote those aspects more. biz.hk: Mainland tourists rely a lot on the Internet in planning their purchases. How can marketers make use of the digital platform to win over these customers?

Rust: The question you’ve to ask yourself is ‘how are the consumers understanding or becoming aware of the products they want to buy’. First of all you’ve got to look at word-of-month that exists in their home markets.

With the word-of-mouth influences, consumers leverage the Internet to look at the product portfolio, what’s being offered in the market – either in the retail stores themselves, or potentially even ordering through the online platform. It also helps them to determine where they are going to shop – which is the location. This is where this notion of one-stop shopping experience is important.

The Internet is being used in multiple formats. It’s not only an information source, purchases are made [online], applications are made in terms of which brands to buy and which range to buy, feedbacks from customers [are collected online] – all that has impact on how we use the Internet today.

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biz.hk: How will that impact on traditional media if the Mainland customers rely so much on the Internet to plan their purchases?

Rust: Although the online capability and the digital communication vehicles are an accelerated importance, we must not forget that it’s part of a bigger picture. We still need to think about communication vehicles as a mix of media – TV, outdoor, print or digital. Also, with that media mix and evaluation of how you use that media mix to drive is the business priority for that brand. Looking at digital component as an entity, you need to look at it first of all from a marketing capability angle – in terms of whether you want to drive awareness, purchase intention, and promotional activities. Then is the question of what platform to use, social media or do you engage with tourist websites, distribution channels like shopping mall. For brands, you need to consider how to engage with the customers. Obviously, localized websites are important. biz.hk: What are the issues that brands should consider in targeting Mainland tourists as they use Hong Kong as test ground for their products?

Rust: For brand owner – especially those high-ticket items that people are purchasing here, the advantage of coming to Hong Kong is that you have a much bigger consumer base. If you are a brand like LVMH, you have a “captive audience” of people who are traveling from China to Hong Kong who are exactly the target audience you are targeting for in Mainland China. These are wealthy individuals who’ve come here specifically to shop. It is very rare and unique that you will find that mass capability all in one spot and at one time. If you launch [your products] in China, it will be much harder to reach this same group of people because they are mixed with other sets of consumers. Hong Kong is really leveraging that.

The distribution network also becomes more difficult in China given the size and scale of the country. You may argue that the retail property space here is more expensive than in China, but then you have the targeted groups that are coming here. That’s makes the financial aspects of the business model easier to justify when you compare to other markets.

Another thing is that brands want to create ambassadors and the perceived values that the brands represent. There is no stronger than the word-of-mouth itself which is very powerful in terms of brand creditability and brand establishment. Given the size and scale of China, it’s hard to create that effect with the few exposures a person can get. If you have people traveling down here and Oliver Rust returning back to China, they become almost the defacto ambassadors of the brands without actually becoming aware of it.

Again, it is another powerful message.

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Online platforms

Unlike early generation mainland tourists, who are more likely to join organized tourist groups and visit mostly “la carte” tourism spots and shopping centers arranged by traveling agencies, the new generation of mainland tourists prefer traveling with freedom and relying on Internet to identify tourism and shopping hotspots.

Early last year, long before the popular Japanese department store Sogo officially celebrated its 25th anniversary in Hong Kong with a big promotion on April 19, major Internet forums on mainland China had posted item-specific promotional deals. When Apple’s first generation I-pad debuted last spring, the first-in-line buyers in many of the long queues outside of Broadway chain stores in Hong Kong were mainland tourists who had queued up overnight for their must-have gadgets.

“It is interesting to note that almost half of mainland tourists consult online platforms (47 percent) and recommendations from friends/families (48 percent) when looking for information about Hong Kong,” says Yang, vice president of Neilson Hong Kong.

“While word-of-mouth is still the most widely accepted mode, there is an increasing engagement with digital platforms, in particular the reliance on discussion boards, forums and blogs for more first-hand experience from the users,” he says.

Positive Outlook

The large inflow of mainland tourists brings Hong Kong customers with high spending power and the kind of energy the city needs, while also consistently tests the city’s ability to upgrade tourism and shopping facilities and build more hotels to meet the increased demands.

Hong Kong residents have been very tolerant to the swift surge of mainland visitors to crowd the city’s narrow streets. The Nielson survey of over 1,000 Hong Kong residents shows that over 80 percent of local consumers in general are either positive or neutral towards the increasing number of Mainland tourists shopping in Hong Kong.

The majority of the Hong Kong residents interviewed recognizes the increased spending of Mainland tourists is creating more job opportunities and boosting tourism industry, and thus brings prosperity to Hong Kong, the survey says.

Hong Kong signed agreements to further relax the visa restriction to Shenzhen residents in the north border last year. The same scheme could be extended to Guangzhou and other coastal cities in the near future.

Given China’s robust economic performances in the past decades, the convenient visa policy would almost for sure attract more Mainland visitors to Hong Kong. The Hong Kong Tourism Board estimates a 10 percent increase for 2011 and suggests that convenient visa policies and strong Chinese currency should keep the momentum going for years to come.

Understand the Asian Shopping Experience

By Jerry Gelsomino

L

ike any new arrival to Hong Kong or China, one spends much time attempting to learn the patterns of behavior of both the locals as well as fellow expats.

Anyone in the business of serving the consuming public specifically wants to know preferences for products or services by these groups.

There are two paths to gaining this kind of information; the first being to set up a research study through one of many choices of vehicles. The second is to go out and talk to people. Being an independent consultant, and due to my own personal desire for varied opinions and anecdotal stories, I have used my own network for face-to-face interviews.

Added to this, I am a voracious reader of every printed report or study detailed in the local or international press about Hong Kong and Chinese consumers. These studies sometimes report behavior inclusive to all of Asia, and others times are specific to a market. Shopping in Hong Kong, Beijing and Shanghai is different, but also has similarities. It is up to the reader to determine if it applies to their own situation.

So what does the consumer want?

What turns the browser into a buyer? And what about the often stated query, "When will China offer its own quality branded product, as good as or better than the international products finding fertile retailing ground here?

The stores and the Internet

In the January issue of biz.hk, opinions were shared about the perspective that Hong Kong's image as a shopping paradise was slipping and what initiatives the city

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could launch to re-establish and strengthen its brand. This time the focus will be on stores themselves and how they can respond to what the industry is learning about emerging customer shopping behavior. In addition, attention will be placed on product preferences being to be identified.

Like the proverbial kid in a candy shop, the recent Asian consuming activity reported has been toward purchases intended to heighten one's personal image among a circle of friends or family. That usually included internationally branded, high profile goods or luxury products. But as these shoppers gain confidence in purchase decisions and become more discerning about what they buy, I believe a new commodity will be in great demand: product information which adds to build a legacy.

We've learned recently from a Nielsen’s survey that the majority of mainland tourists planned their purchases before coming to Hong Kong, With the aid of the Internet, company websites and social networking portals are easily reached, through which the shopper can become armed with information about products, before setting foot in a store. This obviously puts the challenge directly on the in-store sales associate; do they know what they are selling, as well as and better than the shopper? Be forewarned, Asian shoppers are arriving with their shopping lists and will not be deterred from their intentions.

Besides gaining knowledge about products through the Internet, shoppers also use more traditional methods as well.

In a study by Multinational Business Marketing Review earlier this year, they found that “the major information channel for Chinese consumers was their going to a shopping mall experience. And of those

responding to the survey, more than half said they either occasionally or rarely believe advertisements."

Browsers and buyers So what are these shoppers looking for?

In her paper on consumer behavior, Li Yi-you, School of Textiles and Garments, Southern Yangtze University, details that “(in China) Department stores are now crowded with people, but few of the shoppers are serious buyers. Chinese consumers are eager to see what is available, especially from among foreign products. Chinese consumers have a lot of time to browse, and therefore are disinclined to convenience or impulse buying. In Chinese cities, window-shopping and browsing are favorite weekend pastimes."

For this reason, effective visual presentation demonstrating new trends in fashion, technological advancements and product performance are extremely important.

Along with the increased display efforts, better signage which communicates features and benefits, country of origin, or comparison to competitive products are essential attributes to share with all those browsers.

I've often wondered when stores will catch up with the Internet; offering the previous customer an opportunity to share a product review, accessible in the store.

It is also critical, from experience, that the displays and signs are updated regularly.

As shoppers return to the marketplace frequently, presentations that are 'too dated,' can have disastrous affect on the store's repeat sales. For the majority of Hong Kong retailers, high marks go to them for keeping their window and feature displays fresh.

Brand identity is of course a most

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important attribute to retail success. In any discussion of brand power in China, you usually end up talking about luxury labels.

In a survey conducted by Clear Asia consultancy in December last year, retail and product names such as Salvatore Ferragamo, Prada and Cartier were high on the list. “The results show that there is a winning brand personality in China right now,” comments Oliver Cartwright of Clear Asia, “which is characterized as ambitious, modern, open-minded and confident.”

Jing Daily, an Internet cultural blog states, “Consumers will begin to lose interest in products that are ubiquitous and mainstream, and focus on exclusive products, quality and craftsmanship. They will become much more educated and sophisticated.” They report about “a young woman from Beijing was quoted saying that LV and Gucci products have become too common, and so she had lost interest in them.”

What do consumers want?

Those are all important and interesting attributes to note, bringing us to the question of what the Chinese consumers want; no matter if they are shopping in a store on the mainland, or visiting our city as the home of temples of consumption.

The October 18, 2010 issue of Newsweek magazine highlighted their observations on the changes in attitude of the Chinese consumer. In the lead article, they profiled how companies like Hermes, BMW and Levi's are re-engineering products sold in China with local materials, design esthetics, and through a Chinesecentric marketing strategy. Levi's for instance is marketing a new jean line, Denizen, with slimmer cuts and more localized styling.

CNN Money declared on its website that “In China, branding is more overtly an issue of economic nationalism than in countries such as the United States.” This point of view makes greater argument for the opportunities which exist for Western brands to become more Asian responsive, or Chinese national brands to emerge as legitimately competitive to international, imported products.

At the same time, a study released by McKinsey & Company reported that the Chinese consumer is becoming “more demanding and pragmatic than ever as their horizons expand beyond basic concerns about product features.”

However, as the Newsweek feature also pointed out, this new shopper focus

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requires, “thinking much more carefully about what Chinese consumers actually want.”

As I continue my intense search to uncover the cultural and habitual secrets of China, I’ve been challenged to also answer the question, what do Asian shoppers want?

How do they make a buying decision?

What constitutes a good shopping experience?

By talking to retailers and manufacturers, the results are inconclusive. Similar to consumer behavior around the globes, shoppers often don't know what they want until they see what is available. Retailers and manufacturers have to be perceptive about what is the next big thing based on following leading indicators like, what is or isn't selling now?"

The next big thing Here is a glimpse of what's been uncovered.

Talking to a luxury watch retailer, a trend is emerging where Asian consumers are selecting watches with smaller faces, in contrast to the oversized personal timepieces so popular elsewhere, reflecting a Western and Urban brand image. One can imagine that the smaller profile may be more appealing and useful option to a consumer with a slighter wrist.

Another consultant shared with me her observations of Asian female consumers' interest in fashion that was a bit more demure.

She described her experience with a Chinese retail client who was finding great success with a new line of dresses and tops which featured higher necklines than their European competitors. It appears that the Chinese women are concerned with revealing too much cleavage, while skirts and hemline rise and fall to the seasonal dictates of international fashion trends.

Often retailers experience a significant shift in consumer behavior, tracking sales carefully and reacting to it. These are two examples of discovery and a measured response. How much to invest in the behavioral observation or sales results, is a true test of intuition and confidence.

But other attributes of a retailers' brand have emerged as important to shoppers as well. The Financial Times reported recently that more than two-thirds of Chinese consumers responded that a brand’s corporate social responsibility would affect their purchase decision, according to a new report. CSR was found to be particularly important among the more educated shoppers with higher incomes.

And finally, Vijay Govindarajan, director of the Center for Global Leadership at the Tuck School of Business asked a question that may have originally been intended as an admonishment to Western companies chasing the Chinese market. But in reality, may best sum up the real consumer opportunity in China. “How can you take a product that was originally designed for a US consumer with a median income of $50,000 and profitably adapt it for a middle-class consumer in China whose earnings are significantly less?

About the Author

Jerry Gelsomino, principal of FutureBest, a respected design critic and visionary who makes it his business to track emerging consumer behavior in search of the next big trend. While bringing to his clients extensive brand development experience as well as the ability to interpret successful techniques across product, merchandise and service categories, in all his endeavors, he is focused on creating the very best experience for shoppers, visitors, tenants and guests.

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It’s a Brand New Experience Ocean Park and the Disney are inarguably Hong Kong’s two most important tourist attractions. One has a history of being a local icon, and the other is the world’s most famous theme park. In the first of a two-part series, Paul Pei, Executive Director, Sales and Marketing at Ocean Park, shares with biz.hk the three pillars of the successful marine theme park, and what’s behind the newly opened Aqua City

By Daniel Kwan

Paul Pei

Photos: Victor Fraile/Getty Images

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when the eating stops, the killing will stop – that’s a tagline the WWF has used as well.”

Similarly, the blue fin tuna – think sushi and sashimi – are also being fished at such a rapid pace that they may soon become endangered specie if nothing is done. “We are fishing the tuna out of the sea much faster than they can replenish themselves,” Pei explains. “So if we want tuna around for our children or grandchildren, we got to slow this down.”

Pei stresses that the park doesn’t just rely on the fish to do the talking. There are interpreters along the walls of the aquarium to drive home the message. In addition, the Aqua City has a classroom where children can literally touch the fish – star fish and sea cucumbers – in a wet tank so that they can learn about the “fascination” of these creatures.

“We wanted to design this aquarium for the new eyes – a modern aquarium as opposed to something that goes back to 30-odd years ago.”

Paul Pei

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he past February has been most remarkable for Ocean Park. Attendance figure has shot through the roof.

Visitors from around the world marvel at the beauty and fantastic view of the Aqua City. Often when the park closes, kids who seem to have unlimited energy will have their arms around their parents’ neck and ask: “Can we come back tomorrow?”

Paul Pei, Executive Director, Sales and Marketing at Ocean Park, was not surprised by the overwhelming response. Aqua City – which is twice as big as the original one – is clearly a big draw. Days – and weeks may be a more accurate word – after its launch, thousands of visitors still came because they wanted to see the 5,000 fish representing over 400 species in it.

“We wanted to design this aquarium for the new eyes – a modern aquarium as opposed to something that goes back to 30-odd years ago,” says Pei. “We ended up with this design which gives you a different perspective or a different way to look at the fish – head-on with that big window or from the bottom looking up at the top.”

“It allows us to really depict and tell the conservation story by giving people different views of the fish life,” Pei says.

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and entertainment. These three pillars have been with the park since it first opened in 1977.

“What entertainment does is to bring people here to the park.

We can’t educate them or we can’t share our story if they don’t come into the park,” he says. “We definitely want people to look upon us as a world-class marine theme park. Our mission is really to connect people with nature.”

Judging from figures, it seems that the Ocean Park has been very successful in fulfilling its missions in the past few years.

While it is no secret that the park is attracting Mainland tourists by hordes, it has also proven to be a beloved place for locals who want to spend a day-out for their families. At present, locals account for about 35 percent of the park’s turnover and many are there not once – but twice or many times in the past 34 years.

Animal ambassadors What is that story? Pei says it is not just the Aqua City which carries the message. In fact, the entire park is responsible.

“Everything that we do in Ocean Park – whether it is the fish, the dolphin, the sea lion, or the giant panda – has a conservation message,” he says. “All the fish in that aquarium represent ambassadors. They are ambassadors to help us tell the story of fish, of conservation of the ocean. These fishes live in the ocean and if the ocean is polluted, or the ecological system is damaged, they couldn’t survive.”

For example, the Hammer Head Shark which is a real star in Aqua City has an important message – especially for visitors from this part of the world where shark fin soup is often considered a delicacy for banquets.

Pei says: “The Hammer Head Shark and the other sharks tell the story of how beautiful these fishes are and we have to stop eating shark fin. The message is to appreciate these fishes in their natural environment and habitat and avoid eating them because

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The Ocean Park on average welcomes over 40,000 children into the park each year for its educational programs. Pei says that’s important because the education process must start at an early age. “Our belief has always been that if we start those learning young, they will grow up and as they grow up, that message stays with them. And hopefully, they will pass that on to other people,” Pei says.

“Hong Kong is such a concrete jungle. We live in a metropolitan town that’s hassling and bustling, and concrete buildings, and the children don’t have a chance to be really in the outside, to really see and feel it and touch it so that they have a better understanding – we have to protect these animals as much as Mom and Dad protect us,” he adds.

Education, conservation, entertainment According to Pei, education is one of the three pillars of Ocean Park’s business strategy. The other two are conservation

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“One of our marketing strategies is to build on the loyalty and the memories of people in Hong Kong. If you look back to 1977 when the park first opened, parents in 1977 brought their kids to Ocean Park. Today, those kids are parents bringing their kids to Ocean Park. The parents back in 1977 today are grandparents bringing their grandchildren [to the park].”

“Over the last 34 years we’ve really developed the loyalty among the people in Hong Kong to bring in their families to enjoy the park and to learn from the park. Our generation qualities – if you may – are phenomenal that more often than not you will see three generations visiting the park. That makes us very happy.”

Be different Pei says the park is keenly aware that success can be deceiving and competition is intense. That’s why the park always strives to be different with its own distinct qualities. Aqua City in fact is only a part of its master redevelopment plan which includes a lot

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more new facilities and even hotels. Pei says Ocean Park must keep improve itself to stay interesting and be relevant.

“There is competition all around us – there are other facilities around us. Certainly in Hong Kong we are getting more theme parks and so on and so forth. The one thing that we are trying very hard to do here is to be different,” he says.

But the marketing director points out that they see Disney as a partner rather than competitor. Having two distinctive theme parks gives Hong Kong a unique advantage over rival cities in attracting more tourists – which is good for both the Ocean Park and Disney.

“When people do come and visit, they can visit many parks and we are happy that they visit other parks, but we want to be different so that when they come here to visit Ocean Park, their experience is different from visits to any other parks, either in Hong Kong, in the region, or globally.”

Mainland market On developing the Mainland market, Pei says the park is working closely with tour agents and relevant offices to reach out to more potential customers.

“There is no surprise to anyone that our largest tourism market is the Mainland and the reason for that is it’s very near and of course they have a huge population base and for many of them a trip to Hong Kong is a must. We are delighted that the market is as big as it is and it does support us,” he says.

The Ocean Park already has representative offices in Guangzhou, Beijing and Shanghai and will soon be represented in Chengdu which will bring in new visitors from western China.

“Our representatives in those particular markets are helping us to tell our story, gain and develop awareness for the park and making sure that the tour operators have all that they need to develop tours and programs to Hong Kong and to Ocean Park,” he adds.

Given all these hard work, what will be the outlook for 2011?

According to Pei, things are looking good. “I think we can all – not only just Ocean Park but Hong Kong can take confidence in saying that probably there is a 10 percent growth in the Mainland market.”

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Paul Pei and Ocean Park mascot Whiskers

HUMAN RESOURCES

Fragmented policy

Taking Pulse of

By Daniel Kwan

Where Do We Stand and What’s in Store?

Is it a tax? Or a retirement pension fund? For most people in Hong Kong, the Mandatory Provident Fund (MPF) is probably a little bit of both. Because of its young age, MPF obviously doesn’t offer much financial support for any working individuals in terms of their retirement needs. But with the recent furor over the Government’s proposed injection (later withdrawn) into the MPF, attention has again been focused on its effectiveness to provide a safety net for Hong Kong’s aging population. AmCham’s Human Resources Committee held a forum in February to discuss the issues and invited experts to share their views on what the scheme has achieved since its birth

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t is beyond question that most people in Hong Kong find the Mandatory Provident Fund (MPF) inadequate. Consumers complain that the administration fees are too high, the MPF pool is too small, employees are denied the choice to pick their providers (which are chosen by the employers), and there is a lack of tax incentives to encourage savings. And most sad of all – few care about their MPF savings.

As a retirement scheme, MPF is still a teenager. Ten years ago, Hong Kong had little of a retirement scheme to talk about.

Today, 97 percent of the employed population are covered by one form or another of retirement protection. It is an accomplishment nonetheless. As Ka Shi Lau, Chairman of the Hong Kong Retirement Schemes Association and managing director of the Bank Consortium Trust Company, points out, MPF was a “compromised solution” after 20 to 30 years of debate.

Compromise made “If you look at the 10 years of MPF, it has achieved its objective as a social system.

Is it enough? It’s not enough … I will rate it at six [for a score of one to 10].”

“As a system, it serves its purpose.

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Whether it is successful in giving retirement protection in a bigger sense and covering more people, there are definitely rooms for improvement.”

Many ideas have been put forward to address MPF’s shortcomings. In fact, proposals were made in February to amend the Mandatory Provident Fund Schemes Ordinance and increase the salary ceiling for contributions from HK$20,000 to $30,000, meaning that the maximum an employee may contribute will rise from HK$1,000 to HK$1,500. In addition, the minimum monthly income under which a person must make MPF contributions will be increased from HK$5,000 to $5,500 – this will have the effect of excluding an estimated 80,000 low-income salary earners from the scheme. The proposals are now being reviewed by the Legislative Council.

No matter what changes are adopted, Hong Kong needs to perfect its retirement system given its rapidly aging population.

With longer life expectancy, a typical working couple soon faces a much bigger bill to pay to provide care for their parents and grandparents. It is estimated that by 2047, two people of working age will have to support one of pension age – compared to four supporting one in 2010 (see sidebar).

While it’s easy to point finger and lay blame for the flaws in the system, the truth is

that the Government alone is not enough to fix it and compromises and long-term visions are needed to build a sustainable retirement system in Hong Kong. Compromises among different stakeholders are indeed needed, Lau explains. If MPF was not settled and launched 10 years ago, Lau says Hong Kong probably would still be debating it and it would be even more challenging to reach a compromise now.

Why should it concern you? Apart from the obvious impact that pension contribution would affect the cost of business, the lack of adequate retirement protection – which is closely tied with quality of life issues such as medical and housing – will also undermine Hong Kong’s competitiveness. A report released by consultancy firm Mercer last October rightly points out: “Hong Kong has many reasons to be proud of its achievements. It has a well educated and healthy population (as indicated by its high expectancy) but if it wants to retain its international competitiveness then we will need to take action to keep it one step ahead.”

These actions should not be limited to band-aid type quick-fixes. Lau says that although the MPF serves its intended purpose of a basic form of support, what Hong Kong lacks is a coherent aging population policy.

“My top wish is to have the Government having a central policy unit looking at retirement protection as a whole, because retirement is about housing, social welfare, medical, and retirement scheme – these issues cut across bureaus,” she says.

“Right now, it is so fragmented. Everybody recognizes we have an aging population problem but there is no policy. If we get that, then we already win half the battle.”

“As Chairman of the Retirement Schemes Association, we did a report and gave some recommendations … We will keep talking and making noises so that the Government will know what are the issues,” she says.

For example, the Association will suggest to the Government to offer tax incentives to encourage savings and realign the various regulatory regimes which currently “supervise” the sales of MPF products. The MPFA is looking at possible changes to the withdrawal phase making it not a lump-sum pay-out. In addition, it will also simplify some of the administration issues.

is the cost of labor, and the market will find new norms for that,” he says.

“For most employers, they could be broadly worse off as a result of this but all you are talking about is where you are re-distributing wealth within the economy.”

From a human resources management point-of-view, Oates points out that employers – especially big corporate – can integrate the retirement discussion as part of their “total rewards” for employees.

“Talking about total rewards – certainly for the larger employers – giving employees the opportunity of choice by having a flexible benefit platform, first of all, is differentiator in the market. People find it very attractive and employees warm to it.”

“Secondly, because employees only use benefits that they need to use, it could also be structured in such a way that helps better manage your labor cost and may even reduce your labor cost in some circumstances. In terms of retirement and where it sits in there, although there isn’t a great deal of tax incentive on employee’s voluntary saving, there is a 15 percent deduction on employer’s contribution. So if you pay someone $100 and got taxed on that $100, you can actually pay them $85 and 15 percent contribution into the retirement system if they so choose it, and they only pay tax on that $85.”

“Being offered that choice actually has value to the individual,” Oates says. “A financial savvy person may well see that because they are getting the tax deduction as a much more attractive saving proposition.

Selling ideas Oates says that the question for the government is that do Hong Kong actually need a retirement saving vehicle or universal system, or are people saving enough as it is?

Alan Oates “If the answer is ‘yes’, we actually need much more substantial retirement saving then I like the idea that increase the amount of your [saving] component and make sure more is going in it, and reduce taxes elsewhere,” he says.

Oates says that it is never easy to “sell” the idea of retirement saving and most people do it only because it is required by the law.

“There is a general apathy towards retirement saving. As a retirement practitioner, I really wish that wasn’t the case,” he says. “We have to respect the way a lot of people look at retirement saving as ‘something that I will deal with later’ or they are paying into ‘something that my company has a retirement program, so I must be ok.’”

“To my friends, I always say treat [retirement saving] a little bit like your own health, you don’t need to worry about it every day but every now and again you should see your doctor and have a once-over checkup to make sure that things are looking healthy.”

Pensioners

Cost of business Alan Oates, Retirement, Risk & Finance Business Leader, of Mercer, says in an interview with biz.hk that in the near term “improvements” to the scheme could have the impact of pushing cost of business higher but the effect would eventually be factored in by the market.

“Does it increase the cost of doing business? Immediately, it probably does but over a period of time, the cost of labor

Ka Shi Lau

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Working Population 1950

seven people of working age for every one of pension age

2010

four people of working age for every one of pension age

2047

two people of working age for every one of pension age

Source: “Uncovering the Cracks in Hong Kong’s Mandatory Provident Fund” by Mercer

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Heads in the Sand:

Hong Kong’s Retirement Protection Policy

Editor’s note: The following is a speech by Mr Lam Woon-kwong, Chairperson of the Equal Opportunities Commission, at a luncheon of the Hong Kong Retirement Schemes Association in May 2010. Mr Lam took a close look of the scheme, Hong Kong’s aging population problem, and asked some difficult questions about Hong Kong’s retirement protection policy. The headline above is the original title of Mr Lam’s speech. Mr Lam has given permission to re-print his speech in biz.hk

Lam Woon-kwong

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en years ago, the Mandatory Provident Fund Scheme (MPF) was set up to fund retirement for an ageing population. MPF is supposed to be a scheme that helps people to enjoy decent retirement in their old age. But is it really the case? It seems that we are hiding our heads in the sand by pretending that our retirement protection policy is all right with the MPF in place.

The failures of Hong Kong’s current retirement protection policy are two-fold. First, it does not protect the homemakers and low income workers, many of whom are women. Second, as the global financial crisis in 2008 had showed us how trillions of dollars could be lost in financial investments in a short period of time, the future investment returns of individuals’ MPF accounts are not entirely predictable.

You are all familiar with the World

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Bank’s three-pillar policy on retirement protection which includes: • a public pillar that provides a social safety net; • a privately managed, funded pillar that handles people’s mandatory retirement savings; and • a voluntary pillar for people who want more consumptions in old age.

MPF is supposed to be one of the pillars. However, it is a weak pillar. The compulsory contributions from employer and employee are too small, and the MPF fund management costs, as well as other fees and charges, are on the high side.

MPF does not insure against the risks of low investment returns because of poor individual choice, economic tsunami or longevity. Therefore, MPF would be grossly insufficient on its own, especially for people who have already reached middle or old age.

While MPF does not address the

problem of poverty among those with low incomes, private savings will also be a weak pillar given the income divide and the large percentage of low income earners. It is sad to see so many of our workers having to toil for 12 hours a day, six to seven days a week but earning so little that can barely support themselves, not to say their families.

And we are supposed to be living in a first rate economy with GDP per capita at more than US$30,000!

We can no longer pretend that the problem does not exist, both for moral and economic reasons. The low income earners can’t make any savings now and their earning capability is further diminished by old age. Some have to supplement their old age allowance with meager income gained from doing odd jobs. Some live in shabby conditions like a cageman.

The problem will become bigger in the future. Comprehensive Social Security Assistance (CSSA), supposedly our safety net of last resort, will be a weak pillar too because of its non-contributory nature. CSSA will become an increasingly heavy burden given the weaknesses of the former two pillars.

CSSA expenditure last year amounted to $18.6 billion, a 43 percent increase over the last decade. Its share among total recurrent government expenditure increased from 7.5 percent in 1998/99 to 8.6 percent in 2008/09. At the end of 2008, 53.4 percent of all CSSA cases belong to the old age category. This figure will rise steadily but surely given our aging population, the declining birth rate, and the increasing wealth gap.

About one in five of us are now in the 60-plus category. In 20 years, the

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ratio will be one in three. It is clear that we are now almost too late to plan for an adequate retirement protection policy.

Why should EOC care? Because 680,000 homemakers, 98 percent of whom are women, are totally unprotected.

Because a quarter of a million very low income workers, 65 percent of whom are women, are grossly under-protected. And because many women in elementary occupations are still earning much less than their male counterparts.

Divorce rate has been on the rise steeply. Now, one in three marriages break down in time. We can anticipate many of the homemakers who are without substantial income may become single parents.

Without adequate child care and community support services, single parents face difficulties in finding jobs, not to mention retirement planning.

Our fast-aging population is straining resources. Medical care and social services are not going to be sustainable without major policy reform. As members of the Hong Kong Retirement Schemes Association, you have long been engaged in efforts to promote training, best practice and

sound retirement schemes governance in Hong Kong. Today I call for your continuous commitment to increase awareness of retirement protection within the community and find ways to help your clients better plan for their retirement.

As the baby boomers are rapidly heading into their retirement years, we will need to pull our heads out of the sand and do something about it before it is too late.

In solving Hong Kong’s pressing aging issues, we need more discussions to come up with policies that work for the better-

ment of Hong Kong.

The ones who are toiling in the kitchen or on the streets now, what will their future look like in 20 years’ time?

Where are we as a society heading? The consequence of indifference and inaction would be horrendous. I strongly urge the Government to review the current MPF scheme and look seriously into other options to stop our aging community sliding into this black hole.

“MPF is supposed to be one of the pillars.

However, it is a weak pillar.”

next stage.’ I will get as much out of this company even without the promotion or salary increase, but I will better be a sponge to prepare me for my next job. If you look it that way, then you will say this is my training ground. I would want to walk out of this place and laughing, that’s positive.

Success,

Family and Opportunities

K

a Shi Lau is the AmCham/SCMP’s Winner of the Professional of the Year Award, 2010. In addition to being managing director of the top MPF provider in Hong Kong, the Bank Consortium Trust Company, she wears many other hats.

She is Vice-chairman of the Hong Kong Trustees’ Association. She serves on the Board of the Hospital Authority, Minimum Wage Commission, and the Working Group on Direct Subsidy Scheme (Education Bureau). In an interview, she shares with biz.hk her views of her careers, her motivation, and women in workplace

biz.hk: What are the driving forces behind your everyday’s work?

Lau: First of all, it comes from home teaching. Nowadays, people tend to delegate this to the teachers. No, this kind of values about life comes from your family.

My mother has been very good in terms of giving me the principles about life. I am really blessed that I like study and I don’t mind working hard. So my parents expect me to get ‘A’ because I have that intelligence and diligence. If you get an ‘A’, there is nothing to brag about. So it’s commitment to excellence. Excellence doesn’t mean ‘A’ all the times, it means that you do your best. The best may be a ‘C+’ but that’s fine. That’s my sense of responsibility and wanting really to do your best. If you can’t do your best, then don’t get into it.

That’s my driving force. As a Christian too, I glorify God and help others. biz.hk: Can you tell us about your family background?

Lau: I come from a very traditional family with eight children and I am the seventh. My father is very strict but my mother is the typical home carer, teaching children, taking care of the family, and looking after my father. I was brought up in a very protective environment and some people say it was like a green house.

As a teenager, I went to Thailand to study at an American high school because my father has business there. That’s why

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Ka Shi Lau

after high school, I went to the US instead of the UK. I studied pure mathematics and I was going to do physics and mathematics.

After the first year, it was always proving theorem and you were always on the top of the ivory tower, I asked myself what I wanted to do for the rest of my life. I said I love piano and like children, so I wanted to do child psychology and piano. But my father said no because that was not practical. So he said go into business, and you can come back and help the family. That’s why I went to get my business degree and a MBA at Cornell. That’s my upbringing. I am very fortunate to be exposed to both western and eastern culture.

But I didn’t run our family business after graduation and I got my banking training in New York City because all the banks go to the schools to recruit. So I went to a bank as an executive management trainee. In that class, there was only one female and one Asian – I represented the minority. I actually got sent to a department that most people didn’t want to go. Most people went to the marketing side or the glamorous side of banking.

Sometimes you think that’s not very good but actually that’s better for you.

You learn that through life. There were a lot of tears, a lot of telephone calls to my family in Hong Kong, but my sisters said ‘why don’t you come home’ if you have so much unhappiness. There was a bit of discrimination but it was quite a number

of years ago. But that taught me resilience and toughened me up. If you want to beat me down, I will stand up and be even stronger. That kind of determination comes from going through challenges and cycles in your life. biz.hk: Does that kind of attitude – that never gives up – instill in you a determination that you want to succeed?

Lau: Whether it’s successful or not, it depends on individuals. For other people, it may not be successful. My mother always believes in ‘failure is the mother of success.’ It’s true. If you look at it positively, of course there are tears and frustration, and you want to give up, but after you wipe your tears and think more clearly, you get up in the morning, you go again. You fall down, it’s ok, and you can get up again. biz.hk: How would you advise young people to face rejections and what they see as unfair treatment at work?

Lau: First of all – know how to evaluate yourself. Remember, for every finger you are pointing out, there are three pointing at you. Rather say ‘why didn’t I get that’; maybe think ‘what do I need to do more’.

Even if the company hasn’t been fair, is there something you can get out of this company in terms of knowledge or experience? Then you should say ‘I will learn as much as I can, and that will get me to the

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biz.hk: Would you agree that women have more choices than men in that respect? Woman can quit and get married when they hit a wall in their career but men cannot.

Lau: Women’s role as a carer has been very traditional and deeply-rooted. Some people may choose to get married and stay home. As long as you are doing it because it is good for you and your family, that’s fine.

But it is not good as a way to escape. If you escape from life or challenges, then you are not learning. This is opportunity to make you more mature.

I am with the Women’s Commission.

That’s why we say companies should create an enabling environment for the women if they choose to continue to work and be given a fair chance. This can be family friendly practices like five-day work-week or flexi-time. The Government can also provide more nurseries and child-care centers. We just want to make sure that if

they choose to go to work, they are given equal opportunities. biz.hk: Do you think women face a glass ceiling in the workplace?

Lau: Yes, there is still a glass ceiling.

Sometimes women need to leave the work place to give birth and take care of children so they may lag behind the men in getting to the top. We found that in our study that of the women who return to work, over 70 percent felt that they get lower ranks and less pay. Seventy percent of the employers prefer not to hire women especially those of child-bearing age. As of now, there is already a gap between the medium [of

salary] of men and women. Men get $12,000 and women $8,000. That gap always continues. Only 8.9 percent of the board members of listed companies in Hong Kong are women.

Diversity is important. There is still a certain glass ceiling and our survey shows that women have to sacrifice more to reach there. Of course, women have been increasingly promoted to the administration and managerial level. But it is still about just 15 percent. It should at least reach 50 percent to be fair. That’s why we are pushing there should be at least 30 percent women sitting on the government’s advisory and statutory bodies.

“There is still a certain glass ceiling and our survey shows that women have to sacrifice more to reach there.”

SPORTS & ENTERTAINMENT

AmCham chairman Rob Chipman, right, welcomes legendary soccer player Pele, left, at an AmCham luncheon.

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mCham’s Sports and Entertainment Committee hosted earlier this month a special luncheon in honor of the legendary footballer Pelé. The Brazilian legend, currently Honorary President of New York Cosmos, was visiting Hong Kong as part of a 10-day Asian Tour, with a focus on “spreading goodwill through sport, developing young talent, and building global partnerships.”

At the AmCham luncheon moderated by past AmCham chairman Steven DeKrey, Pelé spoke to an enthusiastic audience about his experience as a professional soccer player and his new role in the rebirth and re-branding of the New York Cosmos.

English businessman Paul Kemsley recently acquired the New York Cosmos and is working to turn it into a Major League Soccer (MLS) franchise. During its existence from 1971-1985, the New York-based team won five championships in the North American Soccer League (NASL).

While the New York Cosmos had played in Singapore, Hong Kong, Shanghai and Beijing in the late 1970s, the recent tour was the club’s first trip to Asia since its rebirth seven months ago and part of a two-year global tour before fielding a professional team to compete at the highest level.

By Kenny Lau Cover and all inside photos (except last three) courtesy of Victor Fraile/Two Up Front

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The following are a summary of some of the questions from the audience at the AmCham luncheon and Pelé’s replies: Hamish Tong (age 8): What was your favorite goal of all time?

Pelé: I remember one moment, and it was a very, very special moment. It was the 1,000th goal I made [on November 19, 1969 at Maracana Stadium] for the Santos. It was a penalty kick, and I was a little nervous.

Kieron Pereira (age 8): What is your favorite position?

Pelé: My favorite position is of course ‘forward’ because forwards always get to score. As a player, my favorite is to score at games. But, I also used to be a goalkeeper and I love playing as a goalkeeper.

Emily Disgaard (age 12): What’s the best advice you could give a girl soccer player?

Pelé: I would give the same advice to girls as I would to boys. In the US, women players are really the best, and they are as good as the boys. The US women’s team has won two World Cups. I used to say to the kids [jokingly]: In Brazil, players would say ‘my father is a very good football player,’ but in the US, we could say ‘Oh, my mother is a very good football player.’

Pele, left, talks to the audience about his experience as a professional soccer player in a session moderated by AmCham past chairman Steve DeKrey, right.

Morgan Powell (age 7): Who was the best goalkeeper that you played against?

Pelé: I played against a lot of good goalkeepers. They were from Russia, Brazil, England and some other places. And I was mad [laughing] with them at games because they were saving goals I was trying to make at World Cup games.

One questioner: What do you think of the amount of money footballers are earning?

Pelé played in four (and winning three) World Cups as part of Brazil’s national team. He scored six goals in 1958, including two in the championship game against Sweden, in which Brazil won its first World Cup title. In 1970, he scored Brazil’s 100th World Cup goal in a triumph over Italy.

Having played for the Brazilian club team Santos for nearly two decades of his career, Pelé joined The New York Cosmos of the North American Soccer League (NASL) in 1975 and led the team to a national championship in 1977 during his third season with the club – which would also become the final season of his entire professional career.

In addition to appearing at the AmCham luncheon during his trip to Hong Kong, Pelé was swamped by reporters at a press conference where he talked about his mission of “making soccer even bigger in the United States through the New York Cosmos.”

While in Hong Kong, Pelé visited the Hong Kong Football Club (HKFC) to motivate and inspire young soccer players across the local and expatriate community and met with local soccerplaying kids from the San Wui Commercial Society School as well as the HKFC Crusaders, a program (sponsored by Prudential) that is dedicated to players with special needs.

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Pelé: I think, for the players, it is good [laughing]. I once told someone that it probably would take me ten years to earn what football players can now earn in one year. Today, the game is different. They have a lot of sponsors and TV coverage. The problem is that football players may only play a year or two for a team and then switch to a different team. They never last long at one place. Back then, players would play for certain teams for ten years or more.

The players today seem like they don’t have much loyalty for the team. The player signs with a team today but may go for another tomorrow. They go to Real Madrid or to Santos or to Manchester.

They are presented with the shirt (and say) ‘I love Manchester’.

Tomorrow they go to Madrid, they say ‘I love Madrid’. They love who pays a little more. That is a danger for football.

James Thompson (past AmCham chairman): Are fake injuries hurting the game?

Pelé: Younger players have a different philosophy and mindset these days. They now play a game that has a lot of TV coverage or corporate sponsors. This is not good. This is something FIFA is trying to work against.

Mark Michelson (past AmCham chairman): What will it take for the US to become a more soccer-playing place?

Pelé: In the US, the game is there. The biggest sports for people aged between 8 and 20, is soccer. At the pro level, the game of football has more competition among other sports like American football and baseball. It becomes more difficult. But the US national team is playing well, even in World Cup games. The American team is strong.

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BUSINESS NETWORK

In the new year, biz.hk continues its series of interviews and testimonials of AmCham members.

Among the many new members joining the AmCham family each month (see page 07), many are SMEs, entrepreneurs, and volunteers of nonprofit organizations who make up a significant share of our membership.

This month, we profile two distinguished individuals who have made a career in their respective industry

By Kenny Lau

The

Right choices

Match-maker with A Mission

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009 probably wasn’t the best of time to start up a business, but that didn’t deter new AmCham member Grace Gao to become an entrepreneur. “It was not easy to do business around that time,” recalls Grace Gao, who registered her company, Grace Int’l Holdings, in mid 2008. The Hong Kong-based SME specialized in component trading and product distribution out of China.

“I don’t regret starting it, and I was lucky in some ways because all I did in 2008 was registration and I did not go into full operation until late 2009,” she says, noting signs of an economic slowdown were becoming apparent in late 2008 within the sourcing and trading industry.

Matchmaking Gao’s mission was to establish a company specialized in sourcing high-quality Chinamade products. To achieve that, Gao now travels each week between her offices in Hong Kong and Shenzhen meeting the outsourcing needs of her clients.

“If you are in our business, you will know it is very hard to find matching partners in the supply chain,” she says. “It takes the customer a lot of time to look through hundreds of suppliers in order to find a good match. And that’s one of the things we specialize.

“And once we find a matching partner for a certain company in sourcing components, we open the book and stay transparent with both sides so that all three parties know whom they are working with. We aim for long-term partnership.”

The cost of doing business in Mainland China has been rising in recent years, and labor cost in the country is now more expensive. But China in many ways remains an important manufacturing center that “can do good quality products at a relatively cheap cost,” Gao believes. “China is in a transition from being a purely OEM supplier to marketing their own brands. In the process, they are trying to become more

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the price is higher and what the benefits are of these components,” she says. “A two-dollar component may be what you are looking for, but there is also a three-dollar option that could better serve your needs at a slightly higher cost.”

innovative in their product lines.”

“Instead of just sewing material together for other brands, they are starting to design and brand their own products,” she adds.

“They are doing it mainly because they want to remain in the industry and stay ahead of the game.”

The good news is that China has also become much more developed on product safety and quality control during the process, Gao points out. “In the past, there were not much of any quality standards. But they are now a lot better in terms of assuring product quality than they were years ago.”

“There are now some very good management people in China who can motivate their employees. They are very aware of industry norms and familiar with industry processes,” she says. “That is important because, whatever you are making, the leader of the factory has to have the right mindset and skills to promote quality.

“I believe the management, especially their vision, is everything. They bring people together to make something happen.”

Quality vs price While China continues to move up in the global supply chain in value and product quality, consumers often neglect the prospect of well-designed Chinese-made products.

“There is no doubt that China is known for mass-produced cheap-end products, but there are also more products that are of quality more than quantity. We are just not promoting it enough or correctly,” Gao stresses. “I am passionate about the best of China and I believe in it.”

Grace Int’l Holdings is company for trading and sourcing suppliers in a variety of products. What sets it apart from others is an emphasis on quality over price. “It is kind of like a dating service for products,” Gao says.

“But we do it according to a very strict standard of quality.”

“I often have to explain to clients why

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The goal is to bring the best of Chinesemade products out to the global market.

“Some may buy things based on the cost factor only, but I want to show people that China does have good quality products if you know where to look and are willing to pay a little more,” Gao says. “And I want to build Grace International as a green company by focusing on products that have the least environmental impact.”

“I focus on green product and technology because consumers are demanding it,” she says. “Consumers are demanding it because they are being educated and making wiser choices. That is the direction I see the company going towards.”

At Grace, the current product line includes electronic components and alternative energy-related parts, fashion accessories as well as organic food and wine. In all products sourced on behalf of clients, the key is how suppliers are chosen, Gao says.

“We take into account how our suppliers

handle their manufacturing process in regards to environmental impact seriously and we select based on certain criteria.”

“Greener” products are often more expensive initially because of the associated cost in R&D. However, their prices come down to an acceptable level when they are adopted by a majority of the market.

“An LED light bulb cost 2-3 times more when it first came out but the price has since come down to a sensible level that everybody can use it. And you get to save money because you use less electricity,” Gao cites in an example. “This trend applies to almost any new technology or new product.”

For a good cause In terms of food items, more people are opting for organic choices, despite a higher price tag, Gao points out. “Consumer behavior is a progression,” she says. “And people are starting to think more about the impact of what they consume and look further down the road in longer term.”

Gao has recently signed a contract with a vineyard in Yunnan Province, China to distribute organic wine to other markets. “It is a project dear to my heart because I grew up in Yunnan,” she says. “It is a premier wine. It is also in line with my goal to bring the best of China out to the world.”

Grace Gao “I picked it up also because of charitable causes,” she adds, noting part of the sales from the wine will go to a non-profit organization for education, particularly for young girls and disadvantaged women, in the province.

Gao has set a lifetime goal to help those in rural China to have better access to education, and she is looking to eventually spend half of her time on charity work. “One of the things I’ve learned over the years is that if you gave somebody a book, and taught them how to read, their lives could change dramatically for the better.”

Life

-time Volunteer

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orn and raised in Hong Kong, Lou Lam has dedicated himself to a lifetime of public service. Prior to his retirement in 2006, he had worked for the Hong Kong Correctional Services for 30 years and had been awarded a number of accolades for his dedicated service in his role as a prisons officer and eventually superintendent during his tenure at the government department.

“My role at the Correctional Services was one of a guardian, a teacher, and a social worker,” Lam says, noting being an AmCham member has opened up a greater network for personal learning.

“Now that I have some life experience, I would like to share that with future generations. I believe it is the right thing for me to do.”

Lam started to get involved in volunteer work about a decade ago,

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participating in school-building projects for underprivileged children in rural China and in campaigns for student development in Hong Kong. “Because I am now retired and I love working with youth, I can spend more time mentoring younger generations by sharing my lifetime experience in their learning and giving them a better perspective and a sense of purpose in life.”

Lam currently serves in a volunteer position as Senior Assistant Commissioner and Director of Public Relations at Hong Kong Road Safety Patrol (HKRSP), a nonprofit group dedicated to educating the public, particularly school children, of road etiquette. “I come from 30 years of service in a branch of the uniformed service of the government, and the Hong Kong Road Safety Patrol happens to be a uniformed group as well,” he says. “It reminds me of those days in the service.”

Start at young age Founded in 1963, Hong Kong Road Safety Patrol aims to curb the number of traffic-related accidents throughout the city by emphasizing road safety through multiple campaigns and platforms. The organization is particularly focused on highlighting the importance of road user manner and etiquette among school children.

“We focus on school children and young adults because we believe it is always best to start right at a young age and become accustomed to following road rules as well as setting a good example for others,” Lam says. “The aim is to help them develop, from an early age, a sense of responsibility as road users.”

Traffic accidents can be and are often very costly, Lam stresses. “The cost in damage can run indefinitely. At the most

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extreme are the loss of lives, disability, and the long-lasting impact on the families of those victimized in road accidents,” he says.

“This is why this is an important education campaign. It is work that has tremendous meaning.”

In the early years, only about 40 students from two schools joined the Hong Kong Road Safety Patrol. Today, over 14,000 participants from some 280 elementary and secondary schools in Hong Kong are actively involved with the group. In addition, kids at kindergarten age make up over 140 teams while there are 12 senior-citizen teams. Total number of participants has exceeded 100,000 over the 45-year history.

Despite the focus on the younger generation, HKRSP is inclusive to allow for a larger base of participants in raising awareness on the issues of road safety citywide. People of various ages, including senior citizens, can be part of the group and participate as cadets of the Hong Kong Road Safety Patrol.

Uniformed group As a uniformed group, HKRSP (much like the Boy Scouts) also aims to help students develop their leadership skills while promoting a strong sense of self-discipline and civic duty, Lam points out. And students are trained to also have a high level of courage and confidence through the process. “The uniform represents a sense of belonging and your particular role within the group,” he says. “It is an important aspect of what we do in nurturing students.”

The exercise of foot drill or marching is to emphasize discipline, Lam adds. “While on parade, an individual is always second to the group. It is not about the individual but the team,” he says. “As part of a team, you need to know how to work with your fellow teammates when you are marching in uniform together. This gives students a chance to learn how to lead but also how to follow orders at the same time.”

HKRSP events such as the annual

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Mar Inspire, Build and Deliver Greater Work Relationships

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Alistair Lamont, Senior Consultant, the alphaeight institute

In a fun and interactive way you will gain powerful insights and learning into human behavior that will then help you boost both your individual and team performance.

During this workshop you will learn: • Why you and other people behave the way they do • How to get along with people who are not like you • How you are perceived by others • How to build productive relationships • How to improve your communication skills with others • How to identify your personal potential Alistair Lamont, Senior Consultant at the alphaeight institute, is a Certified Coach, Qualified Facilitator and trainer with extensive experience in areas of organizational leadership, management and team development for well-known multinationals across Asia Pacific. Lamont's business experience includes senior management and director positions in a number of fields including media, human resources consulting and recruitment consultancy.

Mar What's Next in the Obama US Trade Agenda?

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Elliot J Feldman

Leader of International Trade Practice Baker Hostetler Despite President Obama’s expressed desire during his Asian trip last fall to restart the Doha Round, there appears to be no movement. Trade talk in the Administration centers on the Trans Pacific Partnership, and although there have been several rounds of negotiations, there is not yet agreement on who the trade partners will be. The January Summit with China in Washington appeared to be a great success, but no fundamental disagreements were resolved. What has happened, does it matter, and what now?

Elliot J Feldman is the Leader of Baker Hostetler’s international trade practice.

He concentrates on all forms of trade remedies affecting the movement of goods and services across international borders. He advises foreign governments, international organizations, American and foreign corporations and individuals on matters of trade policy and international law and litigates international trade and legal disputes in all relevant forums in the United States and, occasionally, in foreign countries. He has been a frequent legal adviser to the Government of Canada in WTO cases.

May AmCham Spring Golf Challenge

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Venue: AmCham Office 1904 Bank of America Tower, 12 Harcourt Road, Central

Fee(s): Member Fee: HK$150 Non Member Fee: HK$250 MEDIA WELCOME

Format: Flight of four. First tee-off approx. 12:00pm

Venue: Hong Kong Jockey Club Kau Sai Chau Golf Course Kau Sai Chau

Prizes:

Time: 9:30am - 7:30pm

Hong Kong Jockey Club, East Course Kau Sai Chau Public Golf Course

Cost:

Women’s and Men’s Nett Scores ( Scramble Format) : First and Runner-up.

Women and Men Nearest to Pin and Longest Drive.

HK$1,200 (members) HK$1,400 (non-members) Golf course rules state that $200 must be added for non-HKID Card Holders

Package: Cost includes green fees, driving range (one bucket of range balls), locker, shared buggy, ferry, shuttle bus, optional bus transport from Central at 9:30am and return at 7:30pm, light lunch, diner and the prize-awards. Drinks are additional.

Fee(s): Member Fee: HK$1200 Non Member Fee: HK$1400

For information, see website: www.amcham.org.hk Tel: (852) 2530 6900 Fax: (852) 2537 8824 Email: cli@amcham.org.hk

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2011 March

Lou Lam

parade also give participating cadets a chance to demonstrate their abilities and be part of a group trying to achieve a common goal.

“They perform to compete in our annual parade,” Lam points out. “It is also an opportunity for them to meet with senior figures, and they may find these figures to be their role models.”

“If I were one of these kids getting to meet leaders of our society, I would see them as my heroes,” he says. “When we now look back at our lives as adults, we can often see how we were influenced by our role models.

“And the students are very serious about their role and participation in the Patrol.

You can see that they are very happy and honored when they receive a scholarship or commendation as a result of excellent performance.”

Each year, HKRSP has over 300 events, including a variety of education-focused activities targeting different demographics.

And residents in Hong Kong, in spite of the exponential increase in traffic, have developed a better record of road etiquette and manner, Lam acknowledges. “More and more people are now having a better understanding of the importance of road safety; we are now seeing less people crossing streets illegally or not using bridges when there is no crossing available on ground.”

Because Hong Kong is a congested city with a high density of road users, streets are often very crowded. As Hong Kong is host to a large number of tourists, it is therefore necessary to “remind” people of traffic rules, Lam says. “Visitors may be familiar with traffic rules in their own countries, but they are unlikely to be familiar with traffic conditions in Hong Kong.”

“People of the two different places usually have different cultural understanding of traffic rules,” he adds. “We have a responsibility to raise awareness in road safety among our visitors. This is beneficial to both Hong Kong and our visitors.”

In collaboration with Hong Kong’s Immigration Department, Tourism Commission and Police Force, HKRSP has organized a “Road Safety Tips for Visitors” campaign to be carried out in March and April. During the campaign, cadets and student groups will distribute brochures and souvenirs to incoming visitors at all major ground, sea, and air immigration checkpoints. In addition, public notices and announcements will be made through sponsoring media outlets.

“We believe this is critical because visitors simply may not be aware of the actual traffic condition of Hong Kong,” Lam says.

“It is an education process that could help both our visitors and us in reducing road accidents.”