biz.hk Oct 2013 by The American Chamber of Commerce in Hong Kong

20 13 ’s

“H EA GU LT ID HY E LI TO VI NG

Journal of The American Chamber of Commerce in Hong Kong

EDUCATION FOR ALL

www.amcham.org.hk

”

October 2013

COVER SPONSOR

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Join Dr. Richard Vuylsteke, AmCham President, and the AmCham Board Members, as well as special guests from the Hong Kong Government, as they celebrate this festive U.S. holiday with friends and family. This luncheon is also a time for the chamber to show its appreciation and support of the Hong Kong government officials, whom we have worked with over the past year. Host a government official at your table with one of our three sponsorship options: Corporate Table: HK$6,600 Up to ten (10) complimentary seats -Two (2) HKSAR government officials hosted at your table -Your company logo on all our promotional materials, including event backdrop, website, flyer and social media channels -Your table positioned in a premium location (near head table and/or stage)

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October 2013 Vol 45 No 10

Contents

Richard R Vuylsteke

Editor-in-Chief Daniel Kwan

Managing Editor Kenny Lau

Publisher

COVER STORY

BEIJING DOORKNOCK

TRADE & INVESTMENT

TAXATION

The deficit of the provision of special education, especially for non-Chinese speaking children, is profound in Hong Kong. An investigative report to find out why and what’s necessary to fix the problem

AmCham delegates during its annual Beijing Doorknock in October meet with Central government officials and other think-tanks, ahead of a party plenum scheduled for November when leaders will meet to chart the course of China’s reform

John G Rice has held a number of positions within General Electric’s diverse portfolio of businesses. He talks in a recent AmCham luncheon about GE’s vision and mission in an era where technology and talent are keys to sustainable development

Amid announcement of a nationwide expansion of China’s Value Added Tax (VAT) pilot program, KPMG tax partner Lachlan Wolfers explains the details and how such reform may have an impact on your business

Advertising Sales Manager 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 Ease Max Ltd 2A Sum Lung Industrial Building 11 Sun Yip St, Chai Wan, Hong Kong (Green Production Overseas Group) Designed by Overa Creative Co Unit 1613, 16/F Workingbond Commercial Centre 162 Prince Edward Road West, Kowloon ©The American Chamber of Commerce in Hong Kong, 2013 Library of Congress: LC 98-645652 For comments, please send to biz.hk@amcham.org.hk

AMCHAM NEWS AND VIEWS

BEIJING DOORKNOCK 18 Pre-Plenum Doorknock

04 Editorial AmCham is deeply concerned about the provision of quality education to children with special education needs, regardless of their nationalities. A change in mindset is needed to make inclusive education a reality

07 New Business Contacts 27 executives joined AmCham’s business network last month

23 Focus on “FDE” Chinese government’s incentives to attract foreign investment in services remain inadequate, while trying to think less about capital-intensive FDI and more about talent-intensive “FDE” may prove to be an answer

40 Mark Your Calendar

COVER STORY 08 The Deficit of Special Education in Hong Kong The deficit of the provision of Special Education, especially for non-Chinese speaking children, is profound in Hong Kong. An investigative report to find out why and what’s necessary to fix the problem

13 A Parent’s View A parent talks about her experience in searching for quality education for her children with SEN in Hong Kong

EDUCATION

TAXATION 32 An Update on China’s VAT Reform Amid announcement of a nationwide expansion of China’s Value Added Tax (VAT) pilot program, KPMG tax partner Lachlan Wolfers explains the details and how such reform may have an impact on your business

CHARITABLE FOUNDATION 36 A Joyful Evening More than 20 distinguished guests join the annual AmCham Charitable Foundation Dinner held at the Crown Wine Cellars for an evening of celebration and fund-raising

TRADE & INVESTMENT 24 “Building, Powering, Moving & Curing” the World John G Rice has held a number of positions within General Electric’s diverse portfolio of businesses. He talks in a recent AmCham luncheon about GE’s vision and mission in an era where technology and talent are keys to sustainable development

28 Hong Kong’s Competitiveness According to A Seasoned Observer

14 “It Takes Two to Tango” Dr Jeremy Greenberg, Director of The Children’s Institute of Hong Kong, shares his views on SEN and working models of his institute and The Harbour School

Nicholas Kwan, Director of Research of Trade Development Council, shares his insights on Hong Kong’s strengths and weaknesses in a candid interview

Single copy price HK$50 Annual subscription HK$600/US$90

biz.hk 10 • 2013

COVER SPONSOR

biz.hk Editorial

Board of Governors Chairman James Sun Vice Chairman Peter Levesque Treasurer Tom Burns Executive Committee Evan Auyang, Janet De Silva, Anita Leung Philip Leung, Belinda Lui, Alan Turley Richard Weisman Governors Sara Yang Bosco, Brian Brenner, Ewan Copeland Walter Dias, Rob Glucksman, Toby Marion Thomas Nelson, Catherine Simmons Colin Tam, Elizabeth L Thomson Frank Wong, Eden Woon Ex-Officio Governor President

Robert Chipman Richard R Vuylsteke

Chamber Committees AmCham Ball Apparel & Footwear China Business Communications & Marketing

Rex Engelking Colin Browne Seth Peterson Lili Zheng Roxana Daver

Corporate Social Responsibility

Robert Grieves

Energy Entrepreneurs/SME Environment

Rick Truscott Donald Austin Courtney Davies Corey Franklin Brock Wilson Veronica Sze Damien Lee Peter Liu

Financial Services Food & Beverage Hospitality & Tourism Human Capital Information & Communications Technology Insurance & Healthcare

Rex Engelking

Owen Belman Hanif Kanji Intellectual Property Gabriela Kennedy Amy Lee Law Clara Ingen-Housz Pharmaceutical Stephen Leung Real Estate Neil Anderson Alan Seigrist Senior Financial Forum Alvin Miyasato Senior HR Forum Jacqueline Algar Sports & Entertainment Ian Stirling Taxation David Weisner Trade & Investment Patrick Wu Transportation & Logistics Jared Zerbe Women of Influence Anne-Marie Balfe Anna-Marie C Slot Young Professionals Alison Carroll

EDUCATION FOR ALL

he American Chamber of Commerce in Hong Kong has been advocating for more international school places for many years. Not only does Hong Kong need more places, the city should also continue its existing practice of “inclusion” by allowing local children to enroll in international schools. Diversity and inclusiveness are essential for children growing up in an international society, especially in the age of globalization. Both local children and expat kids can only benefit if they learn together in an inclusive environment – not separately in isolation. The Chamber is also deeply concerned about the provision of quality education to children with special education needs, regardless of their nationalities. The Hong Kong Government has taken some positive steps in recent years by increasing resources, funds, and teacher training to promote “inclusive education” in local schools. But the reality is that too many children, especially those who

are non-Chinese speaking, have fallen through the cracks and are in desperate need for help. Because local schools are less than sufficient in providing high quality SEN education, local parents are turning to international schools to make up for the shortfall of educational support, which means more families are competing for what is already a very limited number of international school places. This turns a problem from bad to worse. As a result, waiting lists are getting longer and longer. In the meantime, practically everybody – children, parents, and even businesses – suffer. An immediate downside due to a lack of schools is that a good number of talented people – business executives, entrepreneurs, investors – who would have come to Hong Kong otherwise have instead chosen not to because they have children with special education needs. At the same time, families who are already here have to choose between leaving Hong Kong or paying a comparatively high price for the

biz.hk 10 • 2013

education of their children, as real good quality SEN support is far from cheap. Many expat parents who don’t have the financial means have opted to return to their home countries solely for educational reasons. That people would leave Hong Kong to find a better educational environment sullies its reputation as Asia’s World City. What’s needed is obvious: a much improved local school system that can meet the special educational needs and expectations of local kids and their parents – and not just Chinese – speaking families, but also ethnic minority ones. This will also help reduce some of the pressure for international school admissions. It was heartening to read in a recent South China Morning Post story that Dr York Chow, chairperson of the Equal Opportunities Commission, has said he will urge the government to vigorously address the issue of education for children with special needs. This is a welcome step toward a truly inclusive educational system in Hong Kong.

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THE AMERICAN CHAMBER OF COMMERCE IN HONG KONG FAST FACTS Community AmCham celebrates over 40 years of promoting business and fostering greater trade ties and community service in Hong Kong. Activities Members can access roughly 400 programs, seminars, and conferences each year featuring top business and government leaders, industry experts and professional facilitators who address timely and relevant business issues. Members Over 1,800 members (40 different nationalities) from over 800 organizations, including multinational firms, small and medium enterprises, entrepreneurs, and non-profit organizations. Committees Our members can join and access up to 28 different committees covering industry sectors, professional service sectors, and special segments of the membership.

New

Business Contacts

BENEFITS Business Networking Visiblity and Corporate Exposure Information Advocacy WHY JOIN AMCHAM? "As a non-American, I have joined the AmCham in every country I have been posted because it is consistently the biggest and most active Chamber of Commerce and the strongest, best organized lobbying force in most countries, therefore able to attract a large number of members of very diverse horizons and able to organize a wide variety of events, attracting very often high profile speakers and therefore large attendance."

The following people are new AmCham members: Anna Whitlam People Pty Ltd Anna Whitlam Managing Director

Mast Industries (Far East) Ltd

Children's Institute of Hong Kong, The

Mattel Asia Pacific Sourcing Ltd

Jeremy Greenberg Director

Citi Catherine Simmons Managing Director, Head of Government Affairs, Asia Pacific

Francis Ma Vice President, Finance & Operations

Joyce Kwok Account Manager, Corporate Sales

Lisa Klein Senior Vice President

Mead Johnson Nutrition (Hong Kong) Ltd Ruthia Wong General Manager

David Peacock Managing Director, Hong Kong

MetLife

Insigniam Felicity McRobb Consultant

Jockey Far East Limited Timothy Taylor Managing Director, Global Sourcing & Asia Operations

Jenny Wong Executive Director, Public Policy, Asia Pacific

George Harb Managing Director - China

UBS AG Rob Stewart Chief Communication Officer, APAC

Walmart Asia Regional Office Ann Bordelon CFO & Senior Vice President Strategy Erica Chan Senior Vice President, General Counsel

Samita Malik Chief Distribution Officer

Walt Disney Co (Asia Pacific) Ltd

Otis Elevator Co (HK) Ltd

Alice Edinger Disney Institute

Michelle Mak Manager, Communications

WW+S, Ltd Frank Lonergan President

Hongkong International Theme Parks Ltd Linda Choy Vice President, Public Affairs

MaryAnn Vale Head of Talent & Organisation Development

Travelport

Merck Sharp & Dohme (Asia) Ltd

Delta Air Lines, Inc

Telstra International Group

Time Warner Inc

Steven Victorin Head of Asia Pacific Corporate Banking & Global Head of Corporate Banking Subsidiaries

Joshua Rose Regional Account Manager - APAC

Membership Department: membership@amcham.org.hk / 2530 6900 www.amcham.org.hk

Rohan Muralee Assistant Vice President, Lockton Benefits Group

Bank of America NA

Crown Worldwide (HK) Limited

REQUEST MORE INFORMATION

Lockton Companies (Hong Kong) Limited

Rediscovered Limited Andrew Spearman Chief Operating Officer

S.T.A.R.S. Foundation Dominic Yin Principal Consultant of Green Affairs

SPEEDFLEX Asia Limited Charles Zimmerman Senior Business Development Manager

View our other members at:

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

biz.hk 10 â&#x20AC;˘ 2013

COVER STORY

expatriates in the queue for a limited number of places in the international sector.

Inclusive education

The Deficit of Special Education in Hong Kong

Photo courtesy: ESF

To include children with autism and other special needs into mainstream education is a challenge worldwide. However, the deficit of the provision of SEN education, especially for non-Chinese speaking children, is profound in Hong Kong. Katherine Walker finds out why and what is necessary to fix the problem

ne of the key measures of the quality of an education system is whether it meets the needs of all students, regardless of their background, and including the most vulnerable. In Hong Kong, the business

community has long campaigned for more international school places for in-coming expatriate families. Yet within the international sector, the shortage is most acute for children with special educational needs (SEN), causing extra anguish for families coming to terms with the challenges

their son or daughter has been diagnosed as facing. According to those involved in Special Education – parents, teachers and academics – that shortage is a symptom of the failings in local schools to cater for these children, which prompts local families to join

biz.hk 10 • 2013

There is concern at every level of provision: from the current struggle by the Child Development Centre (CDC) to find a new and affordable premises, to issues of funding for places in primary and secondary schools and reducing their long waiting lists, and then ensuring fair access to higher education, skills training and work placement. Thousands of families face these challenges. In the 2012/13 academic year, there were 17,440 pupils in Hong Kong identified with specific learning difficulties, according to an Education Bureau’s reply to the Legislative Council. The government line is clear: policy is in place to promote inclusive education so that wherever possible SEN children can be identified and learn alongside their mainstream peers, in line with practice in many countries. Only those with more acute needs should be in special schools, and the 60 schools in this category that it funds should meet that demand. Meanwhile, inclusive – or integrated – education is supported by a raft of initiatives. An Education Bureau spokesperson says: “The EDB provides schools with additional resources, professional support and training for teachers to facilitate schools to adopt a ‘Whole School Approach’ to cater for the needs of students with SEN, including non-Chinese speaking students with SEN.” The EDB has told the Legislative Council that by the end of the 2011/12 academic year, 40 per cent of primary school teachers and 16 percent of secondary teachers had received special education training. Identification processes had also been improved. “In short, we ensure that there are sufficient school places in publicsector ordinary and special schools to

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cater for all eligible children,” the spokesperson says. The logic then follows that if such places are readily available, government should not need to provide special subsidies for those families who opt for an international school instead, regardless of the child’s language background.

An exclusive system Parents like Simon Ng and Virginia Wilson, along with academics and legislators, don’t see it that way. Despite all the policy initiatives and some progress in improving the quality of provision in recent years, they point to a deep malaise where local schools that are traditionally focused on building reputations by attracting the most academically-able students and achieving the best examination results are not doing enough to care for those with SEN. Ng, assistant professor and senior programme director of law at the School of Professional and Continuing Education, University of Hong Kong, who has two autistic daughters, explained why many local families with SEN children resorted to international schools. From his experience, he saw a very different philosophy in the two sectors, although many international schools do not have special needs provision. The schools his two children attended – Hong Lok Yuen International School and the sister secondary school, Hong Kong International College – had made it a core value to cater for diversity. “Everyone has got their different abilities and talents. The school sees this as a positive. Differences are normal. “It is a different philosophy from local schools, where they are talking about academic performance and would rather exclude than include SEN students. They welcome you if you can give the school a better reputation.”

Simon Ng

Ng is deputy chairman of SEN Rights, set up by parents to focus on issues of ethics and equal rights, complementing other NGOs providing supporting services for SEN.

2012/13

17,440 pupils in Hong Kong identified with specific learning difficulties, according to an Education Bureau’s reply to the Legislative Council.

SEN Rights has launched a campaign for the monitoring and implementation of the United Nations rights that relate to children and the UN Convention on the Rights of Persons with Disabilities. It is calling for a stronger legal mandate on equal opportunities to education for children with SEN. Concern is far from limited to parents only. The Equal Opportunities Commission (EoC) last year released a highly critical report on integrated education in Hong Kong, and the Legislative Council has subsequently set up a special committee to investigate. The United Nations Committee on the Rights of the Child has recently released a report and expressed concern over education of children with SEN in Hong Kong. (See box)

and Inclusive Education at the Hong Kong Institute of Education (HKIEd) and principal investigator for the EoC study, says that while there have been some improvements, including funding and training, major challenges remain. According to Sin, it is the will to educate these children within mainstream education that is most worryingly lacking. “There are still a lot of things to be done. In our report we found not all schools are willing to have inclusive practice. From the government, it is not compulsory policy to cater for SEN students. Unlike in the US, there is no mandate for them to have an individual education plan for them. It is up to the school whether or not to provide support,” says Sin. As schools compete for the best students, they do not prioritize those with SEN, he adds. Some schools even turned away the extra funding available for every SEN student admitted, because they did not want to become a magnet for such children by catering well for diversity. “If they get the resources they have to do more work. So they don’t want the money,” Sin points out. Attitudes, he says, need to change. More still need to be done to upgrade the quality of staff to deliver inclusive education. “They can hire teaching assistants to give after-school support, but this is only manpower support, without quality,” says Sin. Many non-governmental organizations provide services that schools could buy-in, but for inclusion to really work, internal expertise and commitment are also needed, he adds. While special schools cater well for students with the most severe disabilities, it is those with mild intellectual problems who are most disadvantaged in the current system, he stresses.

Lack of will

A fair chance

Dr Kenneth Sin, Director of the Centre for Special Educational Needs

Sin explains that integrated education could only be deemed successful if

“Many mainstream schools are trying their best to get rid of these students because they create problems. In the end, they are grouped in the weaker schools, and those schools don’t have sufficient capacity to support them.”

Report by United Nations Committee on the Rights of the Child

Kenneth Sin

families could be confident that their children would not only be well-supported at school, but had a fair chance to access higher education and employment. But according to research by Civic Exchange’s “How Hong Kong’s Universities Recruit, Admit and Support Students with Disabilities,” universities in 2011 only admitted 257 students with known disabilities – less than one percent of the intake. The Hong Kong’s number is also a far smaller percentage than universities in countries such as the US and UK. In the US, students with SEN accounted for about 11 percent of the new students, while in the UK the intake was just under seven percent. Meanwhile, some young handicapped people waited up to six years for training opportunities in sheltered workshops. “Entry requirements for university are so competitive,” Sin says. For example, those with autism might be very good at mathematics and science, but would struggle with liberal studies and Chinese and English language subjects in meeting the requirements under the New Academic Structure – a reform introduced in 2009 calling for six-year secondary education (instead of seven as in the old system) and four-year undergraduate programmes instead of three years at local universities.

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Career training by ESF

Non-Chinese speaking and ESF Included in the many challenges facing the local system is how to provide special support for children of non-Chinese speaking families. “I don’t think the curriculum suits their needs as they have to catch up with Chinese subjects. Special needs teachers don’t know how to cater for them, because their training is only focused on needs of local students,” says Sin. Special schools in the local system only teach in Chinese, he adds, although according to the EDB spokesperson, tuition could be offered in English. Ip Kin Yuen, a Legislative Council member representing the education sector, says: “Many mainstream schools are trying their best to get rid of these students because they create problems. In the end, they are grouped in the weaker schools, and those schools don’t have sufficient capacity to support them.” Schools have found it extremely difficult to cater for diversity, he added. “We need well-trained teachers with different ideas of education, and smaller classes. We are talking about

biz.hk 10 • 2013

Photo courtesy: ESF

more individual attention” something very difficult to accommodate within whole-class teaching, in large classes. Both Sin and Ip believe that government funding should be extended to international schools capable of providing the SEN support that non-Chinese families expect and need. Sin praises the service provided by the English Schools Foundation (ESF), which has learning support centres in all its schools, as well as the Jockey Club Sarah Roe School (JCSRS) for those with profound difficulties. However, places fell far short of demand. “There is an urgent need for an additional English-medium special school,” says Sin. While many international schools offer some professional support for children with learning difficulties, the ESF has the most comprehensive service for the full range of disabilities across its schools, supported by a range of specialists, including psychologists, speech and occupational therapists, and job coaches. But the question of funding for SEN within the international sector is a thorny one. While the government has decided to end the subvention for the ESF, it has “quarantined” its subsidies

The United Nations Committee on the Rights of the Child has released a highly critical report on Hong Kong’s record in ensuring the rights of children, particularly in education. In its latest period report on the implementation of the Convention of the Rights of the Child, Mainland China, Hong Kong, and Macau, released in October, the education of children with disabilities in Hong Kong was raised as an area of concern. It said that children with disabilities experienced de facto discrimination and had limited access to inclusive education and well-trained, motivated teachers. Reports indicated that they were commonly excluded and discriminated, including by teachers, and bullied by their peers. It recommended the further development of early screening services to detect disabilities in children, and more efforts to identify and remove barriers to SEN children being educated in mainstream schools, through inclusive education. The committee also called for the urgent abolition of so-called “designated schools” for ethnic minority children, and for measures to promote their access to mainstream schools. The Hong Kong government should “ensure access to local schools for all children living in Hong Kong,” it said. A government spokesperson responded that the government paid attention to children’s whole-person development in their education and it would implement the committee’s “feasible and practicable recommendations in the light of Hong Kong’s unique circumstances.”

Career development service for SEN students by ESF

for the JCSRS and learning support centres, at levels frozen since 1999. These will be subject to a review of SEN provision for non-Chinese speakers. The agreement does not extend to SEN support in mainstream ESF classes. Pam Ryan, Education Director of the ESF, stresses that the ESF has a very positive attitude towards educating those with special needs. It believes that its provision adds to the richness of its education, for both children with learning difficulties and disabilities, as well as mainstream children who often learn alongside. “We never see it as a deficit model,” she says. The ESF is committed to this provision. “Our philosophy is that we are inclusive in our enrollments.” As in the local education policy, the ESF believes in inclusive education, and integrating children with special needs with those in the mainstream as much as possible. “You are likely to see them in the classroom, perhaps acting differently, but very much part of the school life,” says Ryan. But Ryan adds that delivering such education is not cheap. In the learning support centers, the teacher-pupil ratio is one to seven, with two support staff on hand. “Learning support centers

Photo courtesy: ESF

cost 1.3 times a mainstream class. Jockey Club Sarah Roe costs 3.9 times more,” she says. Ryan regards the ESF’s SEN provision as crucial for non-Chinese speaking families in Hong Kong. It would be difficult to provide without government subsidy. “They [the Education Bureau] believe children can be accommodated in local schools. But that view is a difficult one when it does not match the needs and values of parents,” she says. “The concern for us is that children from English-speaking families with a high level of need would find it difficult being educated in that environment, where the languages of the school and home are different,” Ryan says. Language used at home and at school need to reinforce each other. Very few local schools that cater for SEN children teach in English, she adds, while teaching approaches and values are also different. Many schools do not have websites in English, or publish details of their SEN curriculum. “A lot of parents want the kind of provision we have,” she says. “In all conscience, most societies would accommodate strong education resources for children with SEN. We see ourselves as agents of parents and

governments in meeting that obligation.” Parents should not be the ones to pay extra costs involved in specialist education. “It would be so hard for those parents. They already pay a huge personal cost, and emotional cost. Further financial burden would be doubly difficult.” Under the current funding set-up, the shortfall is met by the ESF. There is another major limitation in the provision, both in the ESF and in English medium schools in general: it does not meet the demand. “This is evidenced through the waiting list,” Ryan notes. Even though learning support places have almost doubled from 112 in June 2009 to 208 in August this year, there are a further 216 children on the waiting list now. Jockey Club Sarah Roe, which can accommodate up to 64 children, has a waiting list of 83. “We could easily double both provisions, but can’t because we don’t have the space or the funds,” Ryan says. Those waiting for places were either not in school, or would remain in their nursery school until a place came up. Expatriates might have to delay their move to Hong Kong, or not come at all.

Child Development Centre Virginia Wilson, chief executive of the Child Development Centre, chair of JCSRS and a board member for The Springboard Project, shares the frustrations. The Springboard Project operates two special classes for children with mild to moderate learning difficulties at the Korean International School (KIS) catering for 10 children at primary level and six at secondary. It has a waiting list of 30 – the maximum it will take. Springboard, a registered charity, receives no government funding. The provision requires extensive manpower resources, with five dedicated staff within the school, plus speech and occupational therapists. Parents pay around HK$5,000 extra a month for the extra support above KIS fees, but therapies are offered free-of-charge, funded by money raised

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A Parent’s View

I Virginia Wilson

from the community. “They (the Education Bureau) are trying to back pedal, but the only way they can do it is to say they can cater for English-speaking children in the local system. But the truth is they can barely cope with the issues in the Cantonese community,” Wilson says. Wilson has an immediate worry in identifying space for the Child Development Centre, which must vacate its long-established home in the Matilda Hospital next year. Its second base, at Tang Shiu Kin Hospital in Wan Chai, will not be able to accommodate all 300 children relying on its early intervention service at pre-school level, and the lease there runs out in 2015. “We are trying to identify where to move. We are still looking for a free space in Hong Kong,” says Wilson. Wilson explains that the challenges facing local and international families and schools are interwoven and need a common response. If the local provision meets expectations, there will be no need to worry about the international sector. For too long, they have been treated separately. “The community needs to join together, irrespective of language, race and economic background, because they have one goal.” The government, she adds, also has a responsibility to help.

biz.hk 10 • 2013

t is traumatic enough for any family when their child is diagnosed with autism. But added to the anxiety for families in Hong Kong is securing suitable education. This can be particularly difficult for non-Chinese speaking families, both local and expatriates. Angela Hennelly, who works for the British Council, has been through that painful journey, from concern for her daughter’s delayed development, the diagnosis of autism, and then the quest for specialist help and an education for her child. “It is a big challenge for anyone coming into Hong Kong. It is really, really expensive. You can only get into a school if you have got the money and are on a waiting list early,” she says. The cost of professional SEN support and daunting waiting lists to secure a place in a specialist school were the key issues her family had faced, says Hennelly, who relocated to Hong Kong in 2007. There are a number of organizations that offer early intervention therapy to English-speaking families. Hennelly used the Autism Recovery Network, while her daughter’s pre-primary schooling was with Watchdog Early Learning Centre and the Child Development Centre, specialist centers for children with learning delays. The good news is that she readily describes both as brilliant. “It is the people in the organization who are most important,” she says. Eventually her daughter secured a place at the English Schools Foundation’s Jockey Club Sarah Roe School, the only English medium primary-cum-secondary school of its kind in Hong Kong for children with more severe learning disabilities. “It is absolutely golden,” she says of the school. “The beauty is that it covers many disabilities, not just autism.” About half the pupils are on the autism spectrum, enabling them to mix with a varied group of children. She says that the availability of special education in which English is used as the teaching medium is vital for Hong Kong. It is unrealistic to expect children who are verbally impaired to be educated and cared for in a Chinese-language environment, she says. They need to be surrounded by the language they are familiar with at home as they have much greater difficulty than mainstream children in developing the bilingualism needed to cope in a local school. “The English medium is crucial. It would have a very negative effect on my daughter not to have this,” she says. Hennelly has worked with the British Council since 1990. The organization, she says, had been “tremendously supportive,” to the point that it takes her daughter’s interests into consideration in her postings. “They have been great in their support which apparently is not the norm here. Greater awareness amongst employers is also key.”

EDUCATION

made to keep the child in a regular classroom with regular kids. You can give them additional support but only if a child is really not learning or benefiting from that environment, should they be pulled out and put in a separate class. That’s a law and every citizen of the US is entitled to that. The US has led the world in special education – no question about that. It doesn’t mean it’s perfect. No such public law exists in Hong Kong.

“It Takes Two to Tango” Dr Jeremy Greenberg, Director of The Children’s Institute of Hong Kong, is the recipient of AmCham Charitable Foundation’s 2013 Ira Dan Kaye Community Service Award. He and his wife Christine Greenberg of The Harbour School are two vocal voices on Special Education Needs (SEN) in Hong Kong. In a recent article entitled “It Takes Two to Tango: Inclusive Schooling in Hong Kong,” Dr and Mrs. Greenberg offer great insights into the local education system, SEN education and what is needed to create a better future for children with special needs. Daniel Kwan sat down with Dr Greenberg to learn more about the issue

biz.hk: Why does the problem of SEN seem more prevalent today than it did decades ago? Greenburg: Some people have studied this issue. For example, in the US, there is an advocacy organization called Autism Speaks – and they have been tracking and publishing the number of children who have autism (which is just one type of SEN). In 2012, about one in every 88 children born in the US was found to have diagnosable condition of autism. That is almost a 10-time increase from about 20 years ago when the number was about one in every 10,000 in the 1990s.

Jeremy Greenberg

Why the increase? The short answer is, we don’t know. Different theories have been proposed. For example, one suggestion is that people are getting better in diagnosing children at a younger age and therefore (the issue of SEN) is popping up in the school system or into people’s radar. That’s probably true but it cannot possibly account for the numbers. And it’s also been theorized that autism or autistic tendency in children was associated with the measles combination vaccine – but that theory has since been disproven.

We really don’t know. I suspect that as population increases, so does the number of children who are going to have special education needs.

increase across many other countries? Maybe not quite to the extent, but all countries are observing increases just the same.

biz.hk: Is that trend uniform across countries? Greenberg: It’s mostly true that the increase has been observed in all developed nations and many developing nations. Maybe not quite to the [same] extent but I know, for example, that Beijing Health Centre in 2005 identified that about one in every 1,000 children in Mainland China had a diagnosable condition of autism. An

biz.hk: How are countries like the US addressing the issue? Greenberg: The US since 1975 has had an entitlement program, which is a public law, called the Education of All Handicapped Children’s Act. It entitles children with any types of special education needs to free and appropriate public education in the least restrictive environment. What it means is that all efforts should be

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biz.hk: How would you describe Hong Kong’s situation, and how is that issue relevant to businesses here? Greenberg: It’s been public knowledge that [international] schools in Hong Kong are competitive and there are waiting lists. There are about 4,200 seats short in the international school system. Because there are far fewer programs that cater to children who need special education, the issue is compounded. The English School Foundation (ESF) has 15 schools that serve about 15,000 kids, plus another 50 or so international schools. However, there are just a handful of these schools that serve children with special needs. And these are small programs with maybe a few dozens of kids each – very small scale. So the problem [of school places] is worse for those families and they have fewer choices. As a result, families and businesses trying to come and work here can’t come if these families cannot find schools for their children. All of Hong Kong loses. I get calls from Dubai, the UK, and the US regularly. And typically the conversation goes like, ‘Hi, my company wants me to move to Hong Kong but I have a four-year-old child who has special needs.’ And I would say, ‘Ok, you can come and have a tour but you are going to have a six to 12 months waiting list.’ This becomes a business problem. When a business cannot bring in an individual because of schooling problem, that business is hurt and all of Hong Kong is hurt. It’s a very simple connection. We are not talking about an abstract relationship here.

biz.hk: How did TCI come about? Greenberg: There is an old saying that ‘necessity is the mother of invention.’ There was an American expatriate family who lived here and had two children with special needs. There weren’t really any options for the family then. They moved back to the US but had to come back to Hong Kong because the company they worked for wanted them here. They moved back in 2003 and that’s when TCI started with three kids in Repulse Bay. So it was an organization developed by family and for family.

“When a business cannot bring in an individual because of schooling problem, that business is hurt and all of Hong Kong is hurt. It’s a very simple connection.”

biz.hk: What was the mission of TCI then? Greenberg: It was then intended to be a one-to-one educational program for children with special needs, utilizing a particular type of special education called Applied Behavior Analysis. The couple ran the school until a few years later when their children were growing up and needed a different kind of placement. The ownership of the school was transferred to Dr Elizabeth (Jadis) Blurton, an American psychologist who has been working here in Hong Kong for many years. Dr Blurton hired my wife and me to come over as a teaching couple. My wife Christine Greenberg is vice principal of the Harbour School and I am director of The Children’s Institute. We went from one organization to two organizations.

kids who need things to be repeated five or six times. And you’ve also got kids who are at the other end of the spectrum, who get bored and are getting into trouble because they already know all these things and could even be smarter than the teachers. What the Harbour School does is that it provides a different approach to teaching kids. Thomas Jefferson once said that “there is nothing more unequal than the equal treatment of unequal people.” That ideology is built into the mission of the Harbour School.

biz.hk: How was the Harbour School established? Greenberg: It’s important to note that TCI and the Harbour School are two separate programs but we work nicely together. We behave like we are a brother-sister program. In around 2006 to 2007, TCI teachers and students were doing so well that they needed a next step or place for TCI students to grow – to learn alongside their general education counterparts. Again, that’s like in an interesting reverse-engineering process, and the Harbour School came out of that. The vision and the curriculum have been developed by Dr Blurton. It now has about 180 students from Grade 1 - 8. There is a real emphasis on differentiation of instruction, and how that’s achieved through small-size classes. With two teachers for roughly 13 kids on average per class, that’s a 1:6.5 ratio. It affords teachers a class size small enough to understand each one of the students and their particular strengths and weaknesses. In a traditional classroom with 20 to 25 kids and one teacher, that teacher is not really given the opportunity to learn a particular child’s strengths – mathematics, literacy or science. That’s ok for an average child but not for non-average

“It doesn’t mean we want to replicate the US system here because the US system isn’t perfect. We’ve got the benefit of hindsight to say there are a lot of good things but there are things that can be better.”

biz.hk: Can you explain your differentiation of instruction?’ Greenberg: The Harbour School does that in a couple of ways. It may provide a high group and a low group, for example, in math. Some of the teachers may need to provide different levels of homework to different kids. Everybody could be assigned different homework every day. You may have a homework assignment of one level and I may have a different math assignment. One of the things that the school does is that it borrows from the same Applied Behavioral Analysis teaching technology that we used at TCI, and it employs a particular instructional technology called personalized system

of instructions or PSI module. That allows teachers to develop a packet of teaching material for each child while children go through those materials at their own pace. So we have a flexible system that allows the children to get what they need. Quite frankly, that’s the definition of fairness. I think the Harbour School really affords the opportunity for teachers to help kids to discover what they are good at and that’s probably the key to life. Some of the grades have a waiting list and some don’t. The board has a vision which is to develop a secondary school so as to be “all-through.” We have outgrown our facilities here and we would like to grow and expand, for example, to have our own secondary school. It would also be small class size and lots of hands-on projects, etc. biz.hk: If you could wave a magic wand and solve one problem of education in Hong Kong, then what would you do? Greenberg: It would be to aid or assist – with a team of like-minded professionals – the Hong Kong Education Bureau to develop a world-class stateof-the-art SEN program for all the children in Hong Kong – Chinese, English and whatever language that they speak. And I know an army of people who would march behind me to help them do that. It doesn’t mean we want to replicate the US system here because the US system isn’t perfect. We’ve got the benefit of hindsight to say there are a lot of good things but there are things that can be better. That’s what we try to build here in The Children Institute and The Harbour School – a progressive and inclusive school community. As I have talked in my article about the School of Tomorrow, we should have educators who know how to teach kids of any background. You have to know curriculum, scope, sequence and basic behavioral management, etc. Hong Kong needs that. It’s expensive. But it’s potentially cost-saving to treat people of special needs at a very early stage so that they would no longer need it. We want to avoid being penny-wise and pound-foolish.

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BEIJING DOORKNOCK

Pre-Plenum Doorknock In October, AmCham HK was in Beijing for its annual Doorknock visit with senior Chinese officials to discuss the challenges and opportunities facing Hong Kong as Asia’s premier business and financial hub

By Daniel Kwan

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2013 AmCham Beijing Doorknock delegates • James Sun, Managing Director, Charles Schwab, Hong Kong, Ltd • Richard Vuylsteke, President, AmCham Hong Kong • Walter Dias, Managing Director, Greater China & Korea, United Airlines • Ewan Copeland, Vice Chairman, Global Corporate Bank, Citi • Lili Zheng, Co-leader and US Tax Managing Director, Deloitte AP ICE Ltd • Colin Tam, Chief Executive Officer, Crystal Vision Energy Ltd • Seth Peterson. Lead Industrial Consultant, Heidrick & Struggles Hong Kong Ltd • James McCool, Executive Vice President, Client Solutions, Charles Schwab & Co • Marlene Bates, Chief of Staff, Client Solutions Group, Charles Schwab & Co • Patrick Pang, Managing Director – Fixed Income, Compliance and Tax, Asia Securities Industry and Financial Markets Association Ltd • Beth Smits, Head of Corporate Affairs, Asia Pacific, SWIFT • Mei Dong, Partner, Transaction Services/Core member, KPMG China, Healthcare Team, KPMG • John Ngai, Managing Partner, Blue Ocean Strategy Co Ltd • Andrzej Cetnarski, Chairman and CEO, Rediscovered Ltd • Dennis Chan, Managing Director, Denz Capital • Andy Liu, Head of Asia Pacific, China and Japan Strategy and Business Development, IMS Health

his year’s AmCham HK Beijing Doorknock was strategically scheduled in October, a month before the 18th Central Committee of the Chinese Communist Party was expected to hold its Third Plenum. At that time, the country’s leadership will unveil the national goals and priorities that will guide China’s reforms over the next decade. “We thought that a Doorknock trip to Beijing before the Plenum would give us a chance to raise topics that might be of immediate relevance to the government as it finalized its reform plans prior to the Plenum,” says AmCham HK Chairman and delegation leader James Sun. “Especially during our discussions at the National Development and Reform Commission (NDRC) and the Development Research Center of the State Council – both key policy planning institutions – we felt our comments on Hong Kong’s role in China’s service industry development were well received.” One talking point raised in most of the meetings concerned the usefulness for Chinese officials to make a distinction between FDI (Foreign Direct Investment), capital-intensive investment, and FDE (Foreign Direct Expertise), talentintensive investment (see sidebar) as it considers how to better cast investment incentives and the measures for success for service industry sectors. “The traditional FDI incentives oftentimes just aren’t relevant to service providers, who bring in smart people not loads of cash,” says AmCham HK President Richard Vuylsteke. “Our suggestion of ‘FDE’ was provided to be a catalyst for stimulating a reconsideration of how China can more successfully attract service industry investments.”

China (Shanghai) Pilot Free Trade Zone Without fail, the one topic that raised the most speculative discussion concerned China’s recent announcement of a Shanghai Pilot Free Trade Zone. “Speculative” because although a general plan for the FTZ was revealed in September, many

People We Met

Liu Sushe

Zhou Bo, HKMAO Deputy Director (third from right)

details remain vague. Such matters as the time frame for development, whether capital account controls will be relaxed, and if there will be fewer restrictions on information exchange, business establishment and operations than elsewhere in the country are not yet public. “Whatever one’s interpretation at this point – optimism that the FTZ will be a major source of near-term reform or pessimism about another hyped plan with convoluted implementation – Hong Kong clearly has to track what’s happening in Shanghai,” Vuylsteke says. “While restrictions on banking and professional services, for instance, may end up being not that much different from the rest of the country, the concept of a so-called ‘negative list’ for project approval and pre-establishment national treatment for businesses are worth close monitoring. Right now we don’t know, but we definitely must be responsive to any challenges to Hong Kong’s competitiveness,” he says. Like previous Beijing Doorknock delegations, this year had strong representation from the financial services sector. They were treated to an exceptionally candid and insightful discussion of China’s monetary policy by Xing Yujing, Secretary General of the Monetary Policy Committee & Director General of the Monetary Policy Department II at the People’s Bank of China. “Ms Xing covered general principles

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Economy of the NDRC, and Zhao Jinping, Director General of Research Department of Foreign Economic Relations, the Development Research Center of the State Council, were also highly informative and useful. Not only did they share their views on China’s export outlook in 2013, they also offered the delegates an update and analysis of the development of the three reform pilot zones – Qianhai, Nansha and Hengqin – in Guangdong, as well as comparison with the Shanghai FTZ.

Xing Yujing

on China’s monetary policy, the internationalization of the Renminbi and the role of Hong Kong and other financial centers in innovation product development, and gave sober warnings of the potential challenges from the Shanghai FTZ,” Sun says. “We in Hong Kong financial circles need to do some constructive reassessment, along with the Hong Kong government, of the potential challenges coming not only from Shanghai, but also developments nearer home in the Pearl River Delta.”

Going global The meetings with Liu Sushe, Deputy Director General of Regional

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Sun Tong

• Zhou Bo, Deputy Director, Hong Kong and Macau Affairs Office • Liu Sushe, Deputy Director General of Regional Economy, National Development and Reform Commission • Wang Jinzhen, Vice Chairman, China Council for the Promotion of International Trade • Xing Yujing, Secretary General of Monetary Policy Committee & Director General of Monetary Policy Department II, People's Bank of China • Dan Kritenbrink, Deputy Chief of Mission, US Embassy • Hanscom Smith, Minister Counselor for Economic Affairs, US Embassy • Song Tao, Assistant General Manager, Xiaomi Inc • Zhou Weimin, Director, Beijing Investment Promotion Bureau • Zhao Jinping, Director General of Research Department of Foreign Economic Relations, Development Research Center of the State Council • Sun Tong, Deputy Director General of the Department of Taiwan, Hong Kong and Macau Affairs, Ministry of Commerce

James Sun and Song Tao (right)

Again this year, the delegation explained in the various meetings how AmCham member companies are helping China companies go global, and are seeing expanded interest from Chinese

and are sold out in record times whenever a new model was launched. Although their phones are not yet available in overseas markets, Song assured the delegates that the company, which was founded about three years ago, has ambitious plans to branch out. “At present, we still have a huge market in China to satisfy,” Song told the delegates. The company has gone from seven founders to nearly 3,000 employees,

Zhou Weimin Wang Jinzhen (third from left) and Richard Vuylsteke

Forging Closer Ties One of the highlights of this year’s Beijing Doorknock was the signing of a Memorandum of Understanding (MOU) between the China Council for the Promotion of International Trade and AmCham Hong Kong. Signed by CCPIT Vice Chairman Wang Jinzhen and AmCham HK President Richard Vuylsteke, the MOU reaffirmed both organizations’ commitment to strengthen cooperation, particularly in areas such as business matchmaking, training, delegation visits, and assisting Mainland Chinese companies to go global. Also present at the signing ceremony were AmCham HK Chairman James Sun, Doorknock delegates, and other CCPIT leaders. “The signing of this MOU formalizes the solid cooperation and productive activities already underway between AmCham HK and CCPIT,” Vuylsteke says. “For five years we’ve been building stronger bridges with Chinese businesses, business organizations, and government offices on behalf of our members. CCPIT has been a reliable source of timely advice and support throughout this development. This MOU demonstrates our continued commitment to work together for better business ties between Hong Kong and Mainland China.” “For a long time, Hong Kong has been an important investment destination and springboard during Chinese companies’ ‘Go Global’ strategy, and providing support for Mainland China’s economic development in the meantime,” says Wang. “By signing the MOU, I look forward to seeing further cooperation between AmCham HK and CCPIT on supporting Chinese companies’ outbound investment and trade in services in Mainland China, as well as promoting comprehensive exchange between Mainland China and Hong Kong’s business communities,” he adds. In fact, cooperation between CCPIT and AmCham HK has had a long history – almost as early as the Chamber was established. AmCham HK was among the first foreign business chambers to send delegations into China when the country’s reform was first started, and CCPIT was often the Chinese agency to facilitate such visits. “This MOU, which is subject to annual renewal, gives us further impetus to vigorously explore new business opportunities and make them better known to the members of our two organizations,” Vuylsteke says. “I must say that I’m bullish on the growth possibilities for AmCham companies and for Hong Kong.” – Daniel Kwan

companies to use Hong Kong as a conduit to overseas investment. In particular, the discussions with Sun Tong, Deputy Director General of the Department of Taiwan, Hong Kong and Macau Affairs, Ministry of Commerce, focused not only on the Shanghai FTZ (Ministry of Commerce is directly in charge) but also on how to further facilitate more Chinese outbound investment. The issue of going global was again a key topic in the meeting with Wang Jinzhen, Vice Chairman, China Council for the Promotion of International Trade. An old friend who some of the delegates have met in previous AmCham events, Wang extended a warm welcome to the group and took the opportunity to sign a Memorandum of Understanding with AmCham HK to further promote cooperation between the two organizations. (see box) Unlike in previous years, this year’s Doorknock added a site visit to a booming Chinese company. The delegation visited Xiaomi Inc, considered one of the hottest technology and communications companies in China today. Headquartered in Beijing, Xiaomi is China’s leading smartphone producer and its founder and CEO Lei Jun is often compared to Steve Jobs of Apple. Welcoming the delegates was Song Tao, Assistant General Manager, who gave the group a detailed briefing on Xiaomi’s history, the company’s vision and mission, and future plans. Xiaomi’s smartphones are hugely popular in China

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a large portion engineers. Its boss Lei Jun reportedly said in August that the company’s revenue could reach RMB100 billion (US$16 billion) in 2015. The 2013 Beijing Doorknock met almost all expectations set before the trip, although a meeting with the China Securities Regulatory Commission was dropped due to last-minute scheduling difficulties. The candid exchanges, discussions of real issues with the

Focus on “FDE” Chinese government’s incentives to attract foreign investment in services – and measurements of success in doing so – remain inadequate. Try thinking less about capitalintensive FDI and more about talent-intensive “FDE”

By Richard R. Vuylsteke

ver since China’s 12th Five-Year Plan, promulgated in 2011, called for substantial expansion of the country’s service industries, provincial and municipal leaders have tried to stimulate greater investment in services. Sectors such as banking, insurance, property management, hospital administration, and manufacturing are all on China’s radar for upgrading. But it’s increasingly clear that there is insufficient homegrown talent to meet near-term needs. Hong Kong-based service-providers, large and small, could help, but they are finding that local governments don’t provide the appropriate incentives or regulatory environment needed for significant investment. Despite the Central Government’s vigorous promotion of service industry growth, foreign participation in that process is less than successful. To illustrate: During an AmCham HK delegation trip to Chengdu and Chongqing in August, local officials stressed the need for service industry development, but they continued to speak of such investment as though it was capital-intensive FDI. During AmCham HK’s Beijing Doorknock in October, delegation leaders suggested to Chinese officials that it might be more productive to start talking more about FDE – “foreign direct expertise” – as a helpful hook for discussing investment in service industries. Why? Because talent-intensive FDE investments need to be attracted, measured, and evaluated differently from traditional capitalintensive FDI investments. FDE can be seen as a subset of FDI.

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relevant departments, and the opportunities to build relationships at a high level of the Chinese government are just some of the Doorknock highlights. The Beijing Doorknock has become a pillar of AmCham HK’s China agenda and it helps lay the foundation and set direction for subsequent programs held throughout the year. Looking ahead, expect more China-focused events, delegation visits and business briefings in 2014.

For example: China’s 12th Five-Year Plan includes the goal of upgrading Chinese factories so that they produce upstream, high value-added products. To succeed, Chinese companies are finding that they need to make substantial improvements in such areas as worker productivity, manufacturing processes, manager training, and water and energy efficiencies. Success in these areas will require more investment in human infrastructure – hiring talented and experienced people who can help raise China’s game – not so much additional physical infrastructure. Nevertheless, even though government authorities understand the importance of “brain power” to service industry success, they tend to focus on achieving high FDI figures provided by large-scale infrastructure development or other capital intensive projects. Chinese officials typically treat foreign visitors to a list of statistics about how many Fortune 500 companies they have attracted and how many million/billion US dollars are invested in the municipality or province. While FDI measurements of success are important, they miss the point when trying to promote service industry development. Local government policies, for example, oftentimes limit the number of foreign work visas issued to any given company based on the amount of its US dollar investments. But services focus on human talent, not big ticket investments. Such regulations based on FDI can seriously constrain firms from bringing in the talent their clients need. A shortage of local experience is also creating a bind. While Chinese universities provide hundreds of thousands of graduates each year, the service industry skills China needs are often the product of years or even decades of experience. Therefore economies that already have a long history of providing worldclass services, such as Hong Kong and the United States, are potential sources of people with the expertise China needs. AmCham HK delivered a simple message on behalf of its members – an eagerness to enter the Chinese market to provide needed world-class services, and in the process to interact constructively with local firms and employees to develop cutting-edge service standards.

TRADE & INVESTMENT

“Building, Powering, Moving & Curing” the World

John G Rice

Since 1978 John G Rice has held a number of positions within General Electric’s diverse portfolio of businesses prior to his current role as Vice Chairman of GE and President & CEO of GE Global Growth and Operations, based here in Hong Kong. He talks in a recent AmCham luncheon about GE’s vision and mission in an era where technology and talent are keys to sustainable development

By Kenny Lau

he electronic age – embarking on an endless journey of making life easier – began when Thomas Edison found a way to light up the world with an incandescent lamp in the late 19th century. It was so revolutionary in the early years that a warning sign was posted telling people not to use matches to switch on lights in rooms equipped with the electric light bulb. History it may be, but what emerged from General Electric

(formed through a merger of Edison’s Edison General Electric Company and Charles Coffin’s Thomson-Houston Company in 1892) had made a significant difference on people’s lives through technology and innovation for more than a century, from household appliances to highly sophisticated industrial and medical equipment. And, history tells of an American electrical innovation company’s “profound belief in a better way” and its “relentless drive to invent and build things that matter.” It is more than a

way of business and very much a way of life as tens of thousands of GE engineers continue to work tirelessly to come up with new technology to make a possibility into a reality.

What matters It is a mission which continues in the 21st century and has become an important value proposition in driving “smart” initiatives and making them work efficiently in a world where substantive challenges and constraints

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in energy, healthcare, infrastructure and even supply of fresh water remain. “If you don’t have electricity or a place to take your kids for medical care when they get sick, all bets are off,” says John Rice, Vice Chairman of GE and President & CEO of GE Global Growth and Operations, at a recent AmCham luncheon, explaining the impact of technology. “About 1.5-2 billion people still have no access to basic things that they need, while 150 million people are poised to join the middle class each

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year in the next few years,” he points out. “They all want the same things that you and I want.” That is, things which will improve the standard of living. “We are always examining what makes sense over the long run,” Rice says. “We have invested in the last 10 years some US$70-80 billion in our core businesses such as oil and gas, power generation, aviation and healthcare, designing for the world which exists today.” “GE is now a company with a good financial services business unit, which gives us leverage in some areas,” he further notes. “We also work with a range of export credit agencies, private equities, and sovereign wealth funds, connecting capital through infrastructure projects.”

A global business GE has a portfolio of business units so diverse and large-scaled that few – if any – corporations could match. Total earnings last year reached almost

US$150 billion, and about 60 percent came from international markets. It has also recorded in the latest quarter a record backlog of orders for products and services at US$229 billion. The company currently operates in 160 countries and has more than 300,000 employees worldwide. In R&D alone, it has 40,000 engineers – or “technologists” – from 60 different countries working to achieve the next technological breakthrough. “As a company, we look everywhere for growth opportunities but we also look everywhere for smart people to continuously innovate and create new technology,” Rice points out. “All the best ideas simply can’t come from any one geography only. It has to be a collaborative global framework.” “The art and science of this is balancing global and local,” he says. “We need to be able to leverage global strengths for new technology and at the same time to be able to apply that new technology in local markets where our customers feel like a customer and not someone at the far-end side of a decision-making chain of events.” “In other words, customers want to have a local look, feel and touch where they do business with us,” he adds.

Human capital As of late, GE researchers are leading a number of promising projects across a range of fields: medical imaging to detect cancer and other diseases at earlier stages; lighter and more fuel-efficient jet engines using composite material; smarter power grids; renewable energy at lower cost; seabed-based oil extraction equipment; advanced desalination process; compressor-free refrigeration; and flicker-free fluorescent lights. None of the above however would have been even remotely possible as a discovery or commercial/industrial product had it not been for the right talent in place. “Everyone likes to talk about new products and technology, but there are other elements that are as important, if not more,” Rice says. “One is people.”

“You can talk all you want about growth rates, but if you don’t have people who share your values and have the ability to get stuff done in an organization, your chances of realizing those numbers are much more limited,” he reasons. “If you don’t have people willing to get dirt on their boots in local markets, and you are far less likely to be able to capture the full potential of those markets simply because you are less agile and flexible when you cover a different region from some place else.”

stresses. “Once you get your people in the field and headquarters to support and make ways for them to do their work and win, you are onto being a truly great global company.” From GE’s perspective, it is all about people and their development as a way of sustainable growth – employees, customers, investors as well as communities where lives are touched

because of a GE technology, innovation, infrastructure or service. It is GE’s way of finding “sustainable solutions that benefit the planet and people.” “We are on a mission to make sure that when they write about world-class global companies at the end of the 21st century, they will include us,” Rice proudly says.

Leadership GE is widely known to be one of world’s best companies in which leadership development is a core value embedded in the corporate culture of an institution and made a vital part of an overall business strategy for sustainable long-term growth. The idea is to create better leaders capable of inspiring teams and providing a direction to accomplish goals in a dynamic environment. “We want to be able to recruit, retain, develop and promote people from any background because we understand the absolute importance of diversity,” Rice says. “And we need leaders who can see the world through the right lenses and understand people.” “This ties closely to our core value of inclusiveness, which is more than diversity but also an ability of our people to adapt and to work in any culture or country,” he adds. “I like using the term ‘recentralizing’ decision-making as it refers to having the same quality decision-making but much closer to the point of contact in a local market. “I grew up in a company where we covered markets in Africa from our office in Dubai and markets in Latin America from Miami. The way forward is to have our senior leaders be much closer to those markets serving customers.” The key in the age of globalization is to have the right talent with the right resources at the right places, Rice

John Rice and Steven DeKrey (right)

Former AmCham chairman Steven J DeKrey was recently in Hong Kong and moderated the dialogue with GE Vice Chairman John Rice at a recent luncheon. He served as senior associate dean and adjunct professor of management at HKUST’s School of Business and Management prior to his current role as president of Asian Institute of Management (AIM) in the Philippines. Established in 1968 with Harvard Business School, AIM specializes in international management education to develop leaders in Asia’s markets and offers full-time MBA and other executive programs. “We are a global school focused on Asia,” DeKrey tells biz.hk. “One of our goals is to be a top school in the field of business education developing talent for the global economy. Recently, with my joining the school about a year ago, we are gearing ourselves towards ASEAN.” “We are focusing on a subset of Asia because ASEAN as an economic community will be coming together imminently, and that will be a great need for talent. As a school, we are very much keen on providing the needed talent and knowledge about ASEAN. So far, we are making some good progress,” he adds.

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area. We’ve been lucky in many aspects that in the post-war era we were the first one to have such a concentration of capital to allow us to industrialize. We are lucky enough to have the kind of talent coming all over from China, Southeast Asia and elsewhere to build this place, where we had to work hard to feed ourselves. Still, we don’t want to lose what we have achieved. We still want to be number 1, 2 and 3 in many areas. But rankings are not that important and should not be taken as a sign of success or failure. If your ranking goes from 1 to 2, the chance is that you are going back to a more normal situation. We should measure success by how we improve the living standard of our population and contribute to other people nearby.

Hong Kong’s Competitiveness According to A Seasoned Observer Nicholas Kwan has enjoyed a front row seat in studying and analyzing Hong Kong’s economy in the past 35 years. He has worked for Merrill Lynch, Hong Kong Monetary Authority, Standard Chartered, and he is now Director of Research of Trade Development Council. In a candid interview, Kwan talks about Hong Kong’s strengths and weaknesses, competition from Shanghai and free trade agreements

By Daniel Kwan Photo: thinkstock

biz.hk: You’ve sat at a front row seat witnessing Hong Kong’s economic evolution of the past 35 years. How do you see its future as people are worried about Hong Kong’s competitiveness? Kwan: First of all, it’s a good sign more people are worried. I remember back in 1996 or 1997 – just right before the handover – our economy was

booming and property prices rose about 10-fold in just six years. Almost anyone could easily become a manager overnight during the period of massive growth. Then we had 10 years of downturn. The adjustment was very painful. We have to realize what kind of situations we are in. First, Hong Kong is only a small place, with around 1,400

square kilometers and about 7 million people. It is important to note that we are now enjoying a lot more attention and success than what is justified by the size of our population and our [land] area. We at one time accounted for 70 percent of China’s exports. Nowhere can you imagine a 7-million people city to handle 70 percent of exports of a population of 1.3 billion

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people. So when things in the long run normalize, we have to be satisfied with a more normal position of where we should be. Over the years, we have been ranked number 1, 2 and 3 in so many areas – finance, trade and others. To a large extent, these [rankings] cannot be justified by the size of our population, the economy, and our geographical

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biz.hk: Will Hong Kong lose out when China accelerates opening up and reform? Kwan: Take Renminbi convertibility as an example. People assume that once China has full convertibility of RMB, they don’t need an offshore RMB center so we are doomed. That’s totally wrong. When China deregulates, experience tells us that the more they deregulate, the more business for us. Our economy has risen several times as China carried out deregulation in the last 30 years. Some people argued that since China deregulated, all our factories were gone. This is good because you don’t want blue-collar jobs and you want white-collar jobs. If the factories are still here, then it means a lot of people are still blue-collar and our living standard cannot improve. We are transforming together with China and we have to change with China. People worry about our future because they want a place where they don’t need to change and business can keep on booming. That is impossible because we are so open and so small. Our strength is on flexibility and change, and adapting to change. We won’t find a formula that we can still be the winner regardless of changes happening outside.

Nicholas Kwan

biz.hk: How should we see change for what it is? Kwan: One key thing is that we should not look at Hong Kong just by Hong Kong. We have ‘offshored’ many of our services including trade and talents. We are building a greater Hong Kong. We are sending our kids to study overseas and learn new technology and knowhow. I don’t see why there is rigidity and why we can’t change and compete in the long run. biz.hk: What does Hong Kong need to do to maintain our lead as a premium RMB offshore center? Kwan: We will still be number one by some broad measurements for some long time to come. Going forward, there are two developments that we should pay attention to. One is breath and the other is depth. We need both but you can’t do all. Our offshore financial market includes so many different segments – FX, equity, debts, general deposits and derivatives. You can’t have an offshore center which is number one in all areas. It doesn’t work that way. For example in the Euro dollar markets, London is constantly

seen as the number one but they are not number one in every aspects. I would imagine as the RMB offshore market develops, it will be the same. For instance, do we want to build a huge RMB derivative market which arbitrages on the onshore and offshore stock market volatility? We may not want that. We need to be selective and consider what kind of market we want to build. In that context, it is possible that some other centers will have a bigger market in some segments than we do. biz.hk: In other words, if we build the right environment, then businesses will come? Kwan: If you talk to HKMA, People’s Bank of China, State Administration of Foreign Exchange, they have some ideas of what they want and what they don’t want, they may not be right. That idea may be different from what the market logic likes. It’s kind of trial and error. We may make a wrong judgment and force some good market to migrate to other people. The same thing could happen elsewhere and other people could make mistakes too. Overall, I think we are much more beneficial in several aspects than other offshore centers. We enjoy close relationship with China and we have first mover advantage. Also, we have our connections not just on the financial side but also with the real economy side. Unless you are talking about British Virgin Islands and Cayman Islands where you only work on the registration side of business, otherwise you’ll need support from the real economy to provide the liquidity that is necessary. We have all these advantages that are unlikely to be taken away. biz.hk: What about Shanghai? Kwan: Regarding competition from Shanghai, it’s a totally different aspect. It doesn’t matter what happens in the Shanghai Free Trade (Pilot) Zone or even the whole of Shanghai, as they can never be an offshore center. By definition, they are onshore and under the jurisdiction of PBOC. Unless one day they are no longer under the

jurisdiction of the PBOC and have their own independent monetary authority and a totally different system of regulation, they can’t call themselves offshore financial centers.

“We are transforming together with China and we have to change with China. People worry about our future because they want a place where they don’t need to change and business can keep on booming. That is impossible because we are so open and so small. Our strength is on flexibility and change, and adapting to change.”

Onshore and offshore are very different. Every economy has grown beyond its border and every country has to do it because otherwise your products can’t compete. The fact is, when you have an economy which has grown beyond your border but your jurisdiction and your government is confined within your border, how do you facilitate your financial activities outside your border? That’s where the offshore centers come up. The fact that we are under HKMA and we follow different rules from PBOC’s becomes a natural strength for us because the more China liberalizes, the bigger China’s economy outside its border gets – either in terms of trade or investment. And there is a bigger need for financing.

biz.hk: Where does Hong Kong fit into the picture of all these regional trade agreements currently under negotiations? Kwan: Hong Kong is behind in the game of RTAs. Most of the free trade agreements until very recently focus on merchandise trade and reduction of tariffs. These are very basic stages of deregulation. Here we don’t have any advantage at all. Our trading partners are already selling to us at zero tariffs so why bother with a FTA? But now we realize that trade is more than just merchandise and tariffs. We actually can enjoy huge advantage if we enter into more FTAs. First, we are heavily services denominated. Just like what we have under Closer Economic Partnership Arrangement (CEPA) with Guangdong. This kind of deregulation has a much longer path to go. But it can bring a lot more benefits because every society is moving beyond industrialization and trade of merchandise into trade in services. biz.hk: What’s your take on CEPA? Kwan: CEPA is our FTA with China. This actually is very important and gives us strong leverages. CEPA also helps China in the sense that they can experiment through us the whole process of deregulation for service sector. Because of CEPA, we can tell other parties that maybe you can use us in entering the China market because we are the first in penetrating the wall. biz.hk: Should Hong Kong consider joining the Trans-Pacific Partnership (TPP)? Kwan: Yes, I would say so. The first reason is that it is unlikely things at the World Trade Organization will move very fast now. So we should not overlook the other channels for RTAs. We were already left out in the early phases but going forward we can’t afford to stay at the outside as the discussions go into all those services and investment sectors which are our bread and butter. If we were left behind, we could be in big trouble.

biz.hk 10 • 2013

TAXATION

An Update on China’s VAT Reform By Raymond Ma

n August 1, 2013, China announced the expansion of the first phase of its Value Added Tax (VAT) pilot programme across the nation. It forms the next step in a transformation begun in January 2012 when it replaced in Shanghai the business tax (mostly five percent) paid by a number of service sectors, including the transportation and logistics industry, with a tax charged on the value added in each stage of the production chain. Under the new VAT regime, firms with annual sales less than 5 million yuan will be taxed at three percent of total sales. For other companies, tax will be calculated based on the value-added portion of sales at rates ranging from six percent for companies in consulting, advertising and most other parts of the services sector to 17 percent for leasing firms. When completed, the new system replaces one where two discrete types of indirect taxes were charged – the VAT against the sale and import of goods into China and business tax for services. Additional services, including railways, telecommunications, real estate and construction, as well as financial services and insurance, will also fall into the scope of VAT in the next 14 months. The rationale for the switch-over is that VAT effectively taxes the final price paid by the consumer for goods and services purchased, rather than businesses themselves. In contrast, business tax is considered more appropriate for developing economies because it levies a tax charge at each state of a supply chain. The move is thus considered a sign that the Chinese government recognizes that the business tax system is no longer suitable given the country’s current stage of economic development.

This new system also brings China closer in line with global tax practices (VAT applies in over 160 countries worldwide), providing additional support for the services industry by making them more competitive internationally as the country continues its transformation from an economy based on capital intensive manufacturing to one more focused on services. On the taxpayers’ side, the introduction of VAT to services has been touted by the authorities as a way for the government to deliver a total tax cut of 120 billion yuan, stimulating economic activity at a time when growth has moderated to about 7.5 per cent this year. However, some businesses – particularly those in the transportation and logistics sector – have complained that the introduction of VAT has actually brought about an increase in their tax burdens. There has also been much uncertainty about how VAT will be implemented in financial services and insurance, which is generally exempt from VAT elsewhere in the world. To better understand the complex issues around China’s implementation of VAT, we speak with KPMG tax partner Lachlan Wolfers. biz.hk: It seems that there’s a lot of uncertainty revolving around how VAT will be implemented for financial services in China. Wolfers: Financial services are critical not only because of the effect on the sector but because it connects the entire economy. On the one hand, business tax already applies at the rate of five per cent for most financial services. On the other hand, most countries exempt financial services from a VAT. So the question is trying to

Photo: thinkstock

balance a government’s legitimate desire to raise revenue with ensuring that the financial services sector in China remains competitive. This is so particularly when you look at the absence of indirect tax liabilities in financial centers in Hong Kong, New York, and London. biz.hk: Do you expect the implementation of VAT for financial services in China to be in line with other countries around the world? Wolfers: I expect China to be one of the first countries in the world to apply VAT broadly to financial services. One reason that’s given for why they can do this is because the regulated system of interest rates – for both deposits and loans – in theory, it already incorporates an allowance for the business tax liability that’s applied in the past, so therefore can afford to include an allowance for VAT in the future. The real issue with that principle is

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that that’s all well and good when you are dealing with regulated financial services, but as we know the Chinese economy and regulation of financial services is changing. What might work for the short term might not for the long term. biz.hk: Is China’s implementation of VAT different from elsewhere in the world? Wolfers: VAT systems around the world typically have a number of common characteristics. China’s has many of them but it also has some uniquely Chinese ones too. For example, they have the concept of the golden tax system in China which is the regulated invoicing system. Other aspects include, for example, in most countries the VAT is paid and accounted for by the head office of a company only, whereas in China it’s accounted by each branch of a company. So a single company can have multiple VAT filing and compliance obligations, whereas in other countries they would have a single one.

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biz.hk: What’s the situation with exported services and how VAT will be applied? Wolfers: The government has issued in September detailed implementation rules for applying VAT exemption for many exported services. What this means is that business in mainland China providing services to overseas customers or in their head office can claim VAT exemption now that they haven’t always been able to in the past. That’s a good thing. In addition, zero rating applies to research and development, and design services. If you have a supplier in China and a customer outside China, the service will typically either be exempt or zero rated. And the ones that are zero rated are certain international transportation services like if you are flying on a Chinese airline from Shanghai to say Australia – that would be zero-rated, or if you shipped goods overseas. R&D and design services are zero-rated and pretty much all the other services are exempted.

Lachlan Wolfers

biz.hk: Generally speaking, what are the reporting and broader implications of VAT for businesses? Wolfers: The broader implications are that businesses now deal with one form

of indirect taxes instead of two. That’s important because VAT is paid to the central government whereas business tax is accounted for at the local government level. Now you effectively are dealing with less bureaucracy. The second point is that once the VAT reforms have been fully implemented around China for all sectors, we are hopeful that the government will introduce wide ranging consolidation or grouping rules, so that a company with multiple branches around China need only file one VAT return at the head office rather than multiple ones around the country. That’s the system that a lot of nations have in places, and once VAT applies nationwide, I am reasonably confident that it will happen. What that does is it lowers compliance costs for multinational companies in particular. biz.hk: What do you think about the confusion that VAT has caused in China’s transportation and logistics sector? Wolfers: If I was to pick one sector that has an increase in their tax burden as a result of these changes more so than perhaps other sectors, it would be the transportation and logistics sector. By the nature of what they do, they work on pretty tight margins, and so if there is an increase in the tax burden it can take time before they can have that reflected in the price they charge for their services. biz.hk: Any specific examples you can mention? Wolfers: Until August this year, you had VAT applying in some cities and business tax in others. Transportation by its nature involves moving either goods or people from point A to B. One of the problems you had in having VAT in some cities and business tax in others is which one of the two applied. Now that we have VAT right across the country, those problems should diminish. A second example is that a lot of transportation also involves moving either goods or people from China to outside, or vice versa. They are affected a lot by rules dealing with exported services. Until recently, there were difficulties with claiming VAT

exemptions for example for foreign shipping agents or logistics companies providing their services to overseas customers. Only in the last couple of weeks has that been rectified. A third example is a lot of foreign shipping companies and airlines use local agents in China, and there’s been an issue about how VAT impacts in a situation where the customer is charged by the local agent in China but the bulk of the work is done by the shipping or airline outside of China. For this, I am confident that the government will address the VAT issues that have arisen here. biz.hk: It seems that the rules governing this sector are in a state of flux. Wolfers: It is absolutely correct. There are clearly some short term problems but I am confident that the industry is providing to the government information on the impact that it is having, and the government is working very hard to try to resolve those issues. I don’t believe it’s their intention to significantly increase the tax burden on this sector. biz.hk: There were some concerns that Chinese shipping companies are exempt from VAT but foreign ones are not. Wolfers: It’s a fact there are rules that affect the transportation and logistics sector that place Chinese domestic companies at a relative advantage to foreign companies, and there have been questions raised by those foreign companies about whether this policy is consistent with China’s WTO obligations. Those concerns have been raised with government officials at senior levels. To be fair, it’s not across the board. Some countries have transportation treaties in place with China where this problem doesn’t arise. It’s really more pronounced for countries that don’t have these treaties. The difficulties with this particular issue are that in my experience treaties are rarely concluded between governments quickly. This is where government to government discussions will hopefully resolve these issues in the not-too-distant future.

Frequently Asked Questions about China’s VAT The VAT timeline As of August 1, 2013, VAT applies to the modern services sector and the transportation and logistics sector. There are still a number of critical services sectors which are still subject to business tax. Between now and 2015, each of those remaining will transition to VAT. Key sectors making the transition include telecommunications, real estate and construction, and financial services and insurance. Together, these sectors account for around 75 per cent of the overall business tax revenue that is collected each year. Tax burden under VAT The most common rate of businesses on services was previously five percent, and some services were charged three percent. The VAT that replaces that applies at six, 11 or 17 percent depending on the type of services being supplied. VAT is expected to lower tax burdens for companies because business tax was a liability that applies on the gross revenue (the total sales receipts), whereas for VAT the tax base is calculated on the net revenue which takes into account the expenses incurred in generating sales. Zero rated and VAT exempt Zero rated means that the business does not pay VAT on the goods or service that it provides, and it gets to claim VAT credits for all of its inputs. On the other hand, exempt means that the business does not pay VAT on its goods and services, but it is not eligible to claim VAT credits for its inputs. An example is research and development services. If a pharmaceutical company wants to set up an R&D centre, it doesn’t pay VAT on the services that it provides overseas, but it gets to claim back all the VAT credits on the cost of building and operating the facility.

biz.hk 10 • 2013

CHARITABLE FOUNDATION

A Joyful

Evening The annual AmCham Charitable Foundation Dinner was held at the Crown Wine Cellars in mid-October to both celebrate and raise funds for the foundation. About two dozens of distinguished guests enjoyed a joyful evening at the former World War II bunker which has become one of the world’s finest wine storage facilities

By Ming-lai Cheung

“Let this be our prayer, let this be our prayer Just like every child” “Lead us to a place, guide us with your grace Give us faith so we'll be safe” The Prayer

Photos: Ian Alexander

his year’s AmCham Charitable Foundation Dinner was officially opened by “The Prayer” beautifully sung by versatile musicians, Jerry Sun and Manting Chan in a fine mid-Autumn evening on October 18, 2013. Handsomely dressed guests arrived at the gracefully adorned glasshouse entrance of the Crown Wine Cellars. More than being one of the world’s finest wine cellars, the site carries a deep history. A UNESCO Asia Pacific

Heritage Site – it was originally known as the Central Ordnance (Munitions) Depot constructed decades ago by the British Military to store ammunition and weapons in preparation for World War II. Sipping crisp champagne next to the elegant marble mosaic, guests were completely immersed in the convivial occasion. Charitable Foundation Chairman Rob Chipman welcomed the generous guests and expressed heartfelt thanks to James Thompson, GBS, Founder and Chairman of The Crown Worldwide Group. For the second year in

a row, Thompson, a trustee of the Foundation, has generously sponsored the event – from providing the exquisite facility, the gourmet four-course dinner with matching delicious wine, and selected wine for the wine auction. Chipman additionally thanked Gage McAfee and Tom Gorman, two other trustees, and Peter Levesque, AmCham Vice Chairman for their liberal donations for the dinner. Ding-Ding-Ding-Ding, before the main course was served, it was time to toast again! Chipman gladly announced

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the Ira Dan Kaye Community Service Award recipient for 2013 to be Dr Jeremy Greenberg, Director of The Children’s Institute (TCI). Dr Greenberg thanked the Foundation and shared with the audience that TCI provides much-needed state of the art special education in English to children with special needs and support to their families. The Award will be presented to Dr Greenberg at the AmCham Thanksgiving Luncheon to be held at the Renaissance Harbour View Hotel on November 23.

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Around dessert time, Toby Marion, owner of the Golden Gate Wine, conducted the wine auction. Funds raised at the dinner (and earlier at the AmCham Ball) will be given to high school, college and university students in scholarships as well as to small and lesser known charities helping children, elderly and disadvantaged people with health and special needs in the local community. With the meaningful purpose in mind, we saw many wine lovers and their philanthropic hands up bidding after the unique wines with rich character from

Margaux, Saint Julien, and Pauillac. An AmCham event is not complete without a lucky draw. The Foundation is very grateful to United Airlines who have sponsored two business tickets to Ho Chi Minh City and Six Senses, a stay voucher for two at the Ninh Van Bay Beachfront Pool Villa in Vietnam. Guess who the lucky person to receive the bundled deluxe experience? Mrs Toom Chipman – and rightly so – as our honorable Chairman Chipman has contributed over the years so magnificently as Chairman to the Chamber and to the Foundation.

biz.hk 10 • 2013

2013 Nov

Mark Your Calendar Competition in China and beyond –

Nov New challenges for old Multinationals

Hellmut Schütte, Distinguished Professor of International Management, Vice President and Dean, CEIBS China is fast becoming the competitive battlefield on which global winners are determined. An increasing number of Chinese companies are moving towards a dominating position in some segments. What are the global implications of the enormous economies of scale in the attractive China market? How do MNCs respond to the local competition? Hellmut Schütte joined CEIBS in September 2009 as Distinguished Professor of Management and European Chair for Sino-European Business Relations. He is particularly interested in aspects of business competition in China and other BRICs. He is also Emeritus Professor of International Management at INSEAD whose faculty he joined in Fontainebleau, France, in 1981 after a career in the areas of marketing and investment banking. Professor Schütte is a well-known speaker in conferences and business meetings, a regular contributor to the World Economic Forum in Davos and other places in the world, and actively involved in various executive programs, board and advisory roles and consulting assignments. He is also author of many articles and nine books, among them the best-seller ‘Strategies for Asia Pacific’ (co-authored with P. Lasserre).

The Rise of Endurance Sports -

Chris Lieto, 3-Time Ironman Champion and Founder of MORE Than Sport Meet and hear first-hand from three-time Ironman Champion, two-time World Champion silver medalist, record holder of some of the world’s fastest bike splits, and Founder and CEO of global charity, MORE Than Sport, as well as Founder and CEO of BASE Performance. Chris Lieto grew up in Danville, California and later began his athletic career playing collegiate water polo at Long Beach State University. In 1997, he saw the Hawaii Ironman Triathlon World Championship on television and decided to participate in his first triathlon ever, which he won. Only three years later he became a professional triathlete, and three years after that, in 2003, he went on to place 13th at that same championship he saw on television which sparked his interest in the sport. In 2011, Chris founded MORE Than Sport, a global platform for athletes of all levels, across all sporting disciplines, to take action through the power of sport to raise awareness of local and global social justice issues.

Development and Investment of

Nov Renewable Energy in China

Dr K K Chan, Founder and CEO, Nature Elements Capital The presentation will review the current development of renewable energy in China and investment aspect including risks and returns analysis. How do we participate in the industry? What opportunities are there for us in the 12th Five-year Plan? Dr K K Chan is Founder and CEO of Nature Elements Capital, a specialist investment manager in renewable energy and clean tech investments in China and Southeast Asia. Prior to his current role, Chan was Managing Director & Head of Investments- Greater China, Climate Change Capital (an investment firm managing over US$1.5 billion assets) and was responsible for all investment activities in carbon emission credits under the Clean Development Mechanism and environmental projects in Greater China. Dr Chan was also Managing Director of CLP Renewables, responsible for building and managing the clean energy and cleantech portfolio of CLP in Asia Pacific. His achievements at CLP included winning the prestigious “Corporate Developer of the Year” by Euromoney and Ernst & Young’s “Global Renewable Energy Awards 2006.”

For information, see website: www.amcham.org.hk

Tel: (852) 2530 6900

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Fee(s): Member: HK$550 Non-member: HK$650 Corporate table: HK$6,600

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

Nov What it Takes to Compete at the Top

Venue: Renaissance Harbour View Hotel Hong Kong Concord Room 1 (8/F) 1 Harbour Road, Wan Chai, Hong Kong

Fax: (852) 2810 1289

Time: 12:00 - 2:00pm Fee(s): Member Fee: HK$250 Non Member Fee: HK$380

Fee(s): Member Fee: HK$250 Non Member Fee: HK$380

Email: kalau@amcham.org.hk

DECEMBER 4 2013 FOUR SEASONS HONG KONG

22 ND ANNUAL HUMAN CAPITAL CONFERENCE Developing Asian Talent for Global Impact

AmCham’s 22nd Annual Human Capital Conference will explore how to develop Asian talent into leadership roles, both for Asia and for impact in the global world. With the development of Asia, the global talent pool has increased in diversity. There is greater mobility of Asians within and out of Asia, while westerners are also attracted to Asia by the opportunities available for career development. Despite this, leadership roles in Asia and globally are still often filled by Westerners, leaving Asian talent out of the boardroom. Businesses are now recognising that this is a very real challenge because successful companies know that not only does Asian talent increase their pool of talent, but also that developing a diverse and inclusive leadership team and workforce improves the bottom line. The Conference will hear from thought leaders, CEOs and Senior HR leaders about how they are positioning their organizations for success. Gold Sponsors PROGRAM Opening Keynote: Developing Asian Talent Kate Bravery, Leadership and Talent Solutions Leader in Asia, Middle East & Africa, Mercer CEO Panel:

Asian Talent and Values in Leadership Dr. Janet De Silva, Dean, Ivey Asia, Ivey Business School, Western University (Moderator) Panelists to be announced

Three Concurrent Breakout Sessions (each session is run twice at 10:30am - 11:30am & 11:45am - 12:45pm) 1) Recruiting Future Asian Leaders Linda Garrett, Managing Director, Garrett Global Consulting (Moderator) Panelists to be announced 2) The future of coaching in Asia – coaching local talent for global business Taisuke Nakanishi, General Manager, Sony Hong Kong Yoshiyuki Suzuki, President , COACH A Co., Ltd. (Moderator) 3) Engaging and Retaining Future Asian Leaders Michael Wong, Greater China Talent Leader, EY Adrian Chan, Director, Michigan Ross School of Business (Moderator) Luncheon Keynote:

Ocean Park: A Case Study in Asian Leadership Tom Mehrmann, Chief Executive, Ocean Park Corporation

Plenary Session:

Disney's Approach to Talent Management: Global Strategies; Local Practices Rob Morton, Asia-Pacific Site Leader, Disney Institute

CONFERENCE DETAILS Time: 8:00am: Registration/Coffee/Sponsors’ Exhibitions 8:20am – 3:15pm: Conference (lunch included) Venue: Four Seasons Hotel Hong Kong, Grand Ballroom, Level 2 8 Finance Street, Central

For sponsorship opportunities, please contact Ms. Mary Simpson at 2530 6922 or msimpson@amcham.org.hk For more details, please visit www.amcham.org.hk/events/signature-events/human-capital-conference