biz.hk Jul/Aug 2014 by The American Chamber of Commerce in Hong Kong

20 14

RE SI G DE U NT IDE IA T LR O EN TA LS

Jul/Aug 2014

A CATALYST IN DRIVING “SMART” URBANIZATION RYAN MAI

VICE PRESIDENT, UTC BIS, HONG KONG, TAIWAN AND MACAU

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of Influence The American Chamber of Commerce in Hong Kong proudly presents the 11th Annual Women of Influence Awards Awards. Once again we are seeking exceptional female executives who continue to make an outstanding contribution at the highest levels of Hong Kong's business world. The awards will be presented at the Women of Influence Conference and Awards 2014 on November 14, 2014 at the Four Seasons Hotel Hong Kong. This is your chance to nominate outstanding candidates for the following awards: 1. Professional of the Year 2. Entrepreneur of the Year 3. Master in Charity 4. Leading Woman on Boards 5. Champion for the Advancement of Women 6. Best Company for Women It only takes 10 minutes online: www.amcham.org.hk/woi Deadline: Monday, September 22, 2014 Sponsorship opportunities available Please contact Ms. Mary Simpson, msimpson@amcham.org.hk, 2530 6922

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July/August 2014

Contents

Vol 46 No 7-8 Richard R Vuylsteke

Editor-in-Chief Kenny Lau

Managing Editor Blessing Waung

Advertising Sales Manager

Publisher

COVER STORY

GOVERNMENT RELATIONS

Amid the formation of UTC Building & Industrial Systems (BIS) by combining the expertise of Carrier, Chubb and Otis, Ryan Mai, Vice President of BIS, Hong Kong, Taiwan and Macau, discusses the adoption of an integrated solution of smart technologies for the next stage of urbanization in Hong Kong and across the region

An AmCham delegation was in the nation’s capital for the annual “Washington Doorknock,” meeting with senior US officials and congressional leaders in roundtable discussions on an array of issues

22 TRANSPORTATION & LOGISTICS

Victor Lee, Commercial Director for Hong Kong and Macau at American Airlines, talks about Asia’s growing importance in the aviation market

CHARITABLE FOUNDATION The AmCham Charitable Foundation continues to contribute to educational and vocational training and inspire local young people to see the world with depth and enthusiasm

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) 3753 1206 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 Tel: (852) 3596 8466 Email: ray.chau@overa.com.hk Website: www.overacreative.com ©The American Chamber of Commerce in Hong Kong, 2014 Library of Congress: LC 98-645652 For comments, please send to biz.hk@amcham.org.hk Single copy price HK$50 Annual subscription HK$600/US$90

AMCHAM NEWS AND VIEWS 04 Opening the Door to Countless Opportunities in Southeast Asia The proposed Free Trade Agreement between Hong Kong and ASEAN is a long-awaited initiative – and an important one by the Hong Kong Trade and Industry Department that supporters of free trade anticipate with a high level of ambition

07 New Business Contacts 42 executives joined AmCham’s business network last month

TRANSPORTATION & LOGISTICS 22 American Airlines Inaugurates HK-DFW Nonstop Service With the launch of a daily direct nonstop flight between Hong Kong and Dallas-Fort Worth, Victor Lee, Commercial Director for Hong Kong and Macau at American Airlines, talks about Asia’s growing importance in the aviation market

HOSPITALITY & TOURISM 28 A Gateway of Unlimited Potential Phillip J Jones, President and CEO of Dallas Convention & Visitors Bureau, speaks of “big” business opportunities with Hong Kong and China in the fourth largest metropolitan area in the US

45 Mark Your Calendar

COVER STORY 08 A Catalyst in Driving “Smart” Urbanization Amid the formation of UTC Building & Industrial Systems (BIS) by combining the expertise of Carrier, Chubb and Otis, Ryan Mai, Vice President of BIS, Hong Kong, Taiwan and Macau, discusses the adoption of an integrated solution of smart technologies

GOVERNMENT RELATIONS

14 Keeping Hong Kong on the Map

An AmCham delegation was in the nation’s capital for the annual “Washington Doorknock,” meeting with senior US officials and congressional leaders, as well as scholars and think tank researchers in roundtable discussions on an array of issues

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TELECOMMUNICATIONS 38 Long Distance Calls, Local Charges To mitigate the escalating cost of international wireless roaming for business travelers, one company is moving ahead with an unprecedented model to help organizations meet their growing needs of mobile connectivity in a cost-effective way

CHARITABLE FOUNDATION

42 Fueling Hopes for a Future Generation With the support and generosity of donors and long-term partners, the AmCham Charitable Foundation continues to contribute to educational and vocational training and inspire local young people to see the world with depth and enthusiasm

32 A Uniquely Texan Experience Recognized as one of the “10 Top Texas Retreats,” Wildcatter Ranch is a unique combination of nature, history, fun and a cowboy experience - a traveler’s dream vacation that is authentically Texan

INFORMATION & COMMUNICATIONS TECHNOLOGY 34 Fighting Against a Virtual Enemy Verizon releases its annual Data Breach Investigations Report in which more than 63,000 online incidents of security breach in 95 countries across 19 industry categories are compiled and analyzed

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biz.hk Editorial

Board of Governors Chairman

Peter Levesque

Vice Chairman

Walter Dias

Treasurer

Tom Burns

Executive Committee Evan Auyang, Sara Yang Bosco Belinda Lui, Alan Turley, Richard Weisman Governors Donald Austin, Brian Brenner, Ewan Copeland Janet De Silva, Rob Glucksman, Robert Grieves John (Jack) E Lange, Ryan Mai Catherine Simmons, Eric Szweda, Colin Tam Elizabeth L Thomson, Jennifer Van Dale Jay Walder, Frank Wong, Eden Woon Ex-Officio Governor President

James Sun Richard R Vuylsteke

Chamber Committees AmCham Ball Apparel & Footwear China Business Communications & Marketing Corporate Social Responsibility Energy Entrepreneurs/SME Environment Financial Services

Walter Dias Colin Browne Seth Peterson Lili Zheng Charlie Pownall Oliver Rust Diana Tsui Rick Truscott Laurie Goldberg Jim Taylor Beth Smits

Food & Beverage Hospitality & Tourism Human Capital

Veronica Sze Damien Lee Peter Liu

Information & Communications Technology Insurance & Healthcare

Rex Engelking

Owen Belman Hanif Kanji Intellectual Property Gabriela Kennedy Law Clara Ingen-Housz Pharmaceutical Stephen Leung Real Estate Charles Kelly Senior Financial Forum Al Miyasato Senior HR Forum Bianca Wong 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 Michael Harrington

he proposed Free Trade Agreement (FTA) between Hong Kong and the Association of Southeast Asian Nations (ASEAN) is a long-awaited initiative – and an important one by the Hong Kong Trade and Industry Department that supporters of free trade, including AmCham Hong Kong, anticipate with a high level of ambition. ASEAN as a group is Hong Kong’s second largest trading partner, with total bilateral trade reaching HK$750 billion in 2013. It accounted for about 10 percent of Hong Kong’s total trade and a 3 percent increase from 2012. Despite a slow global economic environment in recent years following the financial crisis in 2008, bilateral trade between Hong Kong and ASEAN grew 10 percent annually from 2009 to 2013. While Hong Kong currently does not apply any tariff on imports that originate from ASEAN countries, it should seek in the proposed FTA a reduction of tariffs to the minimum level possible for products originating from Hong Kong. Because of its role as a transshipment center, particularly for global trade with China, Hong Kong needs to secure the ability of local trading companies to import, break bulk and re-export goods qualifying for preferential treatment under other FTAs to which ASEAN is a party. In order to reap the benefits of an FTA, Hong Kong should position itself in the context of its economy in the negotiation process by emphasizing a number of key points. These include substantial market opening as well as fair and transparent treatment for Hong Kong’s professional services

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OPENING THE DOOR TO COUNTLESS OPPORTUNITIES IN SOUTHEAST ASIA sectors, a comprehensive section on customs facilitation and customs enforcement, and a high standard of intellectual property protection. The service sectors are an area in which Hong Kong has the most to gain from an FTA with ASEAN. Despite a “remarkable” annual growth rate of 6.8 percent for trade in services between Hong Kong and ASEAN from 2008 to 2012, there remains much untapped potential. And, it goes beyond seeking market access – fair, transparent and timely regulatory treatment in these countries for Hong Kong’s service providers, including those in financial services, is of paramount importance. Hong Kong also has a well-developed and highly competitive logistics industry that faces significant barriers in ASEAN countries. Negotiators on behalf of Hong Kong should pay close attention to specific investment barriers, such as restrictions on foreign companies owning trucking operations, which prevent foreign investors from providing comprehensive logistics services. Given the service-oriented nature of Hong Kong’s economy, it is essential that the FTA commits to adopting policies and measures that foster digital trade, including a provision for

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permanent duty-free treatment for all digital products. More important is stringent enforcement of intellectual property rights, for which customs officials must be granted authority to detain, inspect and seize goods suspected of infringing IP rights. Hong Kong and ASEAN have enjoyed a growing investment relationship – as of 2012, ASEAN was the sixth largest source of foreign direct investment into Hong Kong, which conversely became the fifth largest investor in ASEAN countries. The key for Hong Kong going forward is to create a level playing field by seeking a strong commitment to the rule of law, which forms the foundation for a transparent regulatory process that treats all market participants equally. The proposed Hong Kong-ASEAN Free Trade Agreement has the potential to strengthen Hong Kong’s economy, generate more jobs for the local workforce and bolster the trading system within Asia. And, Hong Kong should launch the formal negotiation process as soon as possible, while continuing to seek engagement and consultation with all industry stakeholders. Once concluded, a free trade agreement will open the door to countless opportunities.

AMCHAM AMCHAM Means Means Business Business

Members Directory

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Charles Chung Director, Account Development Global Client Group, JAPA, Global Corporate Payments Susanna Lee Vice President & General Manager, Card Services

Over 500 500 pages pages in in three three major major sections, sections, including including aa complete complete guide guide to to chamber chamber services, services, Over corporate sponsors sponsors and AmCham Charitable 1,700 corporate Charitable Foundation. Foundation.This Thisdirectory directorylists listsabout over 1,800 members from from over about700 700companies companiesand andorganizations. organizations. members

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BNY Mellon Nikhilesh Mathur Regional Director, Talent Acquisition - APAC

Cathay Pacific Airways Ltd James Tong Director Corporate Affairs

CenturyLink Technology Solutions Benny Lee Regional Sales Director - Hong Kong, China & Taiwan

Child Development Centre, The Virginia Wilson Chief Executive

China Daily Raymond Warhola Executive Director, Asia Pacific

CIGNA Worldwide Life Insurance Company Limited Austin Marsh CEO

Coach A (Hong Kong) Co., Ltd

Johanna Hung Senior Manager, Corporate Communications Ghislain Boiteau President Asia Pacific

FMC Chemical International AG Debbie Ng Human Resources Director, AGS

FTI Consulting (Hong Kong) Limited Leo Wood Senior Director

Philip Morris Asia Limited Kevin Chen Manager Government Affairs

Regal Portfolio Management Ltd Simon Lam Executive Director - Finance

The Repulse Bay Co, Ltd Andrew Whitaker General Manager, The Repulse Bay, and Area General Manager, Peninsula Clubs and Consultancy Services

Hinrich Foundation Edmond Lee Investment Analyst

InterContinental Grand Stanford HK Alexander Wassermann General Manager

Jones Day Sebastien Evrard Partner

KDDI Hong Kong Limited Takakazu Tsunoda Deputy Managing Director Yuichi Iwanaga Director Yoichi Ide CEO

Kenneth Chau & Co. Ken Yeung Partner

Knight Frank

Michelle Leung Coach

Mark Palmer Director, Head of Kowloon Commercial Agency

Cognita

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Michael Chue Head of Sales and Marketing, PCCW Solutions

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Santa Fe Relocation Services Nigel Crockett Director Sales and Marketing, Asia

Schneider Electric (Hong Kong) Ltd Ray Choi Director - Infrastructure Solution

Smartmaps Limited Charlotte Lollieron-Bernard Business Development Manager Asia Alfredo Velazquez Baranda CEO

Winnitex Ltd Nelson C W Wai Executive Director

Withers Timothy Burns Registered Foreign Lawyer (New York, CT)

WMGS Consulting (Shenzhen) Co Ltd Bill Foudy Vice President Softlines Nancy Kielty Vice President General Merchandise, Consumables, Health & Wellness Ignacio Lopez Senior Vice President, Operations

View our other members at:

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biz.hk 7-8 â&#x20AC;˘ 2014

COVER STORY

Ryan Mai

A CATALYST IN DRIVING “SMART” URBANIZATION The journey of United Technologies Corporation in pursuing new ways to meet the demand of future development is a family affair long in the making. Amid the formation of UTC Building & Industrial Systems (BIS) by combining the expertise of Carrier, Chubb and Otis – a family of innovation dating back to the early 1800s – Ryan Mai, Vice President of UTC BIS, Hong Kong, Taiwan and Macau, discusses the adoption of an integrated solution of smart technologies for the next stage of urbanization in Hong Kong and across the region

By Blessing Waung Photos: Brian Production Ltd

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n a given day in Hong Kong, an estimated 5.2 million people commute on the MTR, cramming themselves onto the labyrinths of escalators that themselves are an important transport in a system of mostly underground rail stations. Going from one station to another, most commuters are unlikely to give a second thought – if at all – to the technology behind what they’re riding; but when they do, chances are they will see an Otis escalator – and a legacy of innovation that continues today. Yet, Otis lifts and escalators are only part of a much bigger portfolio of everyday building systems and technologies in Hong Kong. In September 2013, United Technologies Corporation announced the formation of UTC Building & Industrial Systems (BIS), combining Carrier heating, ventilating and air conditioning systems, Chubb fire and electronic security systems, and Otis, the world’s largest manufacturer of elevators and escalators, to drive the adoption of smart technologies by offering an integrated solution for the next stage of urbanization in Hong Kong and across the region.

A vision The journey in pursuing new ways to meet the demand of future development is a family affair long in the making. Willis Carrier, who designed the first modern air conditioning system, was the great-grandson of Lydia Otis, the cousin of Otis founder Elisha Otis. This traces Carrier and Otis – companies which have helped shape the world known today through precision engineering – from a family of innovation dating back to the early 1800s. It is a reflection of a centurieslong commitment to driving growth and improving the lives of people around the world. It is also a commitment that spans a broad spectrum of endeavors. Along with the more well-known divisions of Otis, Carrier and Chubb, BIS also

oversees Kidde smoke alarms, Edwards’ fire alarms, Interlogix security systems, and many others. Altogether, the organization employs more than 120,000 people worldwide, with the various businesses hauling in more than US$29 billion in annual sales. “With the formation of BIS, we have positioned UTC as the leading business partner with our customers in providing sustainable solutions for what is seen as a mega trend of urbanization,” says Ryan Mai, Vice President of BIS, Hong Kong, Taiwan and Macau. “We are talking about a global transformation, which includes not only the major markets such as China, India, Russia, North and South America, but any place that strives to draw upon our knowledge and expertise for the purpose of infrastructure development and city planning.”

A determination Mai, who was previously Managing Director of Otis for the same region, has been with the company since 1989, first starting out as a service sales representative. Graduating with a degree in mechanical engineering from Washington State University and later earning an MBA under the United Technologies Employee Scholar Program, Mai has an expansive understanding of the products; however, he is not simply an engineer but also an envoy to promoting green technology through his position of business development. Mai is inarguably enthusiastic about the products behind the brand and undeniably passionate about bringing forward the benefits of advanced technology to accommodate social and economic development. “All of our products and services can essentially support a smart building,” he says. “The strategy was, given our broad range of intelligent building systems, how can we align ourselves to create greater value to better serve our customers.” A seamless integration of building systems was the genesis of the current

collaboration efforts, with UTC foreseeing a strong synergy when combining a flow of products and technologies as well as construction of elevators and air conditioning, chillers, heating and ventilating systems, along with sophisticated systems of security access, fire protection, suppression and monitoring. As a collective provider of technologies, BIS is looking to tackle the next stage of urbanization in Hong Kong, Mai points out. “There are opportunities that come with

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economic development, and then there are business opportunities that we can create,” he says. “Construction is very relevant to our business.” “Depending on the business cycle, there are years in Hong Kong when private, commercial developments outpace public development. And, there are other years when there are fewer private jobs but more large-scale government infrastructure projects,” he adds. “To have an impact on society, we have to be prepared for both.”

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Local development In the next three decades, Hong Kong’s population will reach an apex of 8.47 million, driving the government to focus on sustainable development in all of its current projects while also creating numerous opportunities in the application of smart technologies. For instance, Chief Executive CY Leung in 2012 announced a proposed budget of HKD 1 billion per year to turn Hong Kong into a “city of lifts” to

enable better access for the elderly and disabled. Furthermore, then-Chief Executive Donald Tsang in 2007 pledged in his policy address to reduce the energy intensity of Hong Kong by a minimum of 25 percent in the next two decades. The government has also indicated the need to increase the amount of commercial land space for future development and to integrate sustainability and green measures into the city’s infrastructure – a mission for which BIS has a longstanding

from their initial capital investment on new technology, while demonstrating their commitments to responsible and sustainable development.”

A greener future

relationship as a provider of innovative solutions. Otis products are ubiquitous in a city of skyscrapers filled with lifts and escalators. In June alone, a few hundred additional units of escalators for the MTR were added to the company’s maintenance portfolio. Working in cooperation with Dragages Hong Kong, nearly 100 units of the “Gen2 ” elevator were installed in the Kai Tak Cruise Terminal, one of Hong Kong’s mega infrastructures in recent years. Based on UTC’s analysis, there are more than 2,000 properties aged 15 years or older in its portfolio. When the entire segment market is taken into consideration, the number grows considerably. “And how do these buildings compete with the shiny, new ones with the latest technologies?” Mai asks. “The answer is they can either demolish the property and rebuild or upgrade their existing systems with more efficient and sustainable technologies.”

Return on investment Helping developers to plan and design green and sustainable products is also a major priority, Mai says. “A lot of developers have a difficult time justifying the cost of purchasing sustainable products,” he points out. “That’s because they often have a perception that developing green and sustainable features in buildings will cost more money.” “Actually, the returns on investment of initial capital on these projects pay for itself from operational savings in the long run,” he adds. “Not only can new buildings be designed to be much more sustainable, but old buildings can also be retrofitted to reap similar benefits.” From a property owner’s perspective, keeping up-to-date with the latest technology is an important key to remaining relevant in a highly competitive market because tenants are reluctant to stay in an energy-inefficient or outdated building, especially when many other

buildings are being constructed or retrofitted with cutting-edge green features by the dozens. “When you look at the make-up of energy consumption of a building, the chiller plant generally consumes about 40 percent while lift and escalators take up about 8-10 percent. Together, that’s already about half of the total energy spent,” Mai says. “In other words, if a building spends ten million dollars a year on electricity, 5 million is just for powering air conditioners and lifts.” This is an area where substantial savings in energy consumption can be achieved through technology, he adds. Shanghai’s International Financial Center, which was retrofitted to gain better efficiency from the chiller plant, heating, ventilation and air conditioning systems, was able to achieve a return of annual savings of US$1.2 million. In Hong Kong, BIS has recently completed a retrofit for the Eton Hotel by upgrading the chiller systems, Mai points out. “More customers now understand that they are able to get savings

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Going forward, Mai is most enthusiastic about the company’s ability to apply future technology that will not only be environmentally sustainable but also benefit a large number of end users in a specific way. Describing a scene that may appear straight out of a science fiction movie, he notes of “futuristic” elevators and security systems combined to allow for a much more seamless flow of movement of people in commercial and residential buildings and workplaces by incorporating the company’s Lenel facial recognition system. Because of Carrier’s energyefficient heating, air conditioning and refrigeration systems, some 141 million metric tons of carbon dioxide were prevented from being released into the atmosphere since 2000. A reduction in carbon footprint by driving higher energy efficiency as well as end-to-end sustainability remains a major priority of BIS, in a spectrum of areas including construction of its own factories, products it delivers to clients and how they’re utilized by customers. “We need to make sure that we don’t just talk about sustainability,” he says. “When we build a factory, we have to make sure that our own factories are LEED certified.” The commitment for a greener future is particularly evident in the Asia Pacific region. In 2012, Otis’ newest factory in Chongqing, China was awarded a LEED Gold certification, joining its Tianjin counterpart, which was the world’s first LEED-certified elevator factory in the world and China’s first LEED Gold factory, ever. “Our goal is that we are taking the lead on walking the talk – being able to reduce our carbon footprint, our water consumption and waste generation,” Mai says. “This is all part of United Technologies’ efforts to support the green evolution.”

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1818 Charles and Jeremiah Chubb patented the world’s first detector lock

1853 Elisha Otis sold the first elevators with safety brakes

1881 Robert Edwards invented the first electric bell

1902 Willis Carrier designed the first modern air conditioning system

1917 Walter Kidde pioneered smoke detection

GOVERNMENT RELATIONS

KEEPING HONG KONG ON THE MAP An AmCham Hong Kong delegation of Chamber leaders and staff was in the nation’s capital for the annual “Washington Doorknock” during the week of June 16-20, meeting with senior US administration officials, congressional leaders and staffers as well as respected China/Asia scholars and think tank researchers in roundtable discussions on an array of issues. AmCham President Richard Vuylsteke reports

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The 2014 Doorknock Delegation Peter Levesque Chief Commercial Officer Modern Terminals Limited AmCham Chairman Walter Dias Managing Director, Greater China & Korea United Airlines AmCham Vice Chairman

Federal Maritime Commission: (from left) Michael Tsang, William Vuylsteke, Ming-Lai Cheung, FMC Commissioner William Doyle, Peter Levesque, FMC Chairman Mario Cordero, Richard Vuylsteke, Robert Grieves, Walter Dias and George Yuen

mCham Hong Kong conducts yearround advocacy on behalf of its membership. This year, by the end of June, the Chamber had already held 105 meetings and roundtable discussions with US, Hong Kong and Mainland China officials – 30 of them in Washington, DC. Such activities facilitate and boost the effectiveness of follow-up correspondence, formal submissions, and requests for government action. Washington Doorknocks in particular demonstrate the usefulness of established relationships. AmCham’s access to key players in Washington (see sidebar) makes it possible for Chamber executives working “in the trenches” to share insights on priority issues for international businesses in Hong Kong and the region. “It’s extremely important for us to visit Washington on these Doorknocks,” says AmCham Chairman Peter Levesque. “Sure, we keep Hong Kong on the map, but no less important we demonstrate how Chamber members can put US business interests in context – Hong Kong vis-à-vis China as well as the rest of Asia. All our messages are tied to US competitiveness and job creation.” It helps that Hong Kong, despite its size, punches above its weight in Washington. As one senior Commerce Department official said in reply to AmCham’s appointment request, “Last year, we had a US$37 billion dollar trade surplus with Hong Kong. That’s a great calling card for you in the nation’s capital!” AmCham’s 2014 Doorknock delegates (see sidebar) not only drew upon their own experience and expertise but also from written assessments on specific topics

Baker Hostetler: Elliott Feldman, Trade Attorney

from more than a dozen senior AmCham executives. This pre-trip preparation added significant details to the discussions and reinforced talking points made throughout the year in a series of AmCham briefings and roundtables. “I found the access to senior Administration officials very impressive,” says Walter Dias, AmCham Vice Chairman. “I especially liked the roundtable discussions at the think tanks because we were able to go deeper into topics concerning Hong Kong and China, especially US-China relations.” Once in the door, what was discussed?

Hong Kong When asking about Hong Kong, the delegation’s interlocutors generally focused on these topics -

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Pentagon: US Navy Captain Scott Tait (far left)

• The current status of “one country, two systems,” with particular interest in the current tone of Beijing-Hong Kong relations • Great interest in learning about the discussions and activities going on in HK concerning universal suffrage, press freedom and autonomy of the judiciary, especially following the recent release of China’s White Paper on Hong Kong • The ongoing assessment in Hong Kong of what impact the Shanghai (Pilot) Free Trade Zone’s development may have on HK’s financial and transportation & logistics sectors • Hong Kong’s growing role as a springboard for Chinese investment into the United States and the role of the SelectUSA program Beyond the usual focus in Washington on Hong Kong’s economic strength, the delegation encountered greater interest than usual in the city’s social and political environment. “People here are more concerned about Beijing’s attitude toward Hong Kong,” said one China scholar. “We wonder if ‘one country, two systems’ will continue to work as well going forward.”

US-HK economic ties The AmCham delegation stressed the continuing importance of strong US-Hong Kong relations, emphasizing Hong Kong’s partnership in economic, commercial, trade and investment activities. To bolster several “asks” during meetings, the delegation also pointed out that Hong Kong had an excellent track record with the US

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John E. (Jack) Lange Partner Paul, Weiss, Rifkind, Wharton & Garrison AmCham Governor Robert Grieves Chairman and CEO Hamilton Advisors Limited AmCham Governor George Yuen Director Visteon Corporation AmCham Corporate Member Richard Vuylsteke President AmCham Hong Kong Ming-Lai Cheung Director, Government Relations & Public Affairs AmCham Hong Kong Michael Tsang Director, Membership AmCham Hong Kong William Vuylsteke Intern, AmCham Hong Kong

Doorknock at a Glance

Who?

Doorknock delegations are comprised of senior executives who hold AmCham leadership positions and/or have served in briefing roles at Chamber roundtables. The delegates can come from any business sector, and normally the group’s collective background includes China, Hong Kong, greater Asia, and global business experience.

Dept of Agriculture: Deputy Secretary Krysta Harden (third from right)

What?

Doorknock delegates update top US leaders and decision-makers on issues concerning Asia, particularly US-China-HK topics. The participants give business perspectives on selected economic, political and social topics, drawing upon their experience in “Asia’s World City” and from their frequent travel throughout the region.

Where?

Delegation appointments are within the Washington Beltway and focus on high-quality meetings with important players who make or influence US-China and US-Asia policy.

When?

The annual Washington Doorknock is normally held in the first half of June, but other dates are also possible. (The Chamber also conducts annual Doorknocks to Beijing, and Shanghai. In response to AmCham member requests, Chamber delegations have recently gone to Bangladesh, Vietnam, Myanmar, Chengdu/Chongqing, and various cities in South China.)

Why?

Washington interlocutors see AmCham Hong Kong as an experienced and insightful “honest broker” on business and economic assessments of China and the region. Moreover, Hong Kong is a major – and growing – US trading partner, a major conduit for investment into and out of China and also a decision-making hub for many business operations in South and Southeast Asia.

Dept of State: US Senior Official for APEC Bob Wang

beyond trade, working closely in such areas as environment and international law enforcement. Throughout the week, AmCham’s delegation delivered these asks – • Visa-free travel from Hong Kong to the United Stated (similar to Taiwan’s recent agreement) • Expedited implementation of the APEC travel card, with special arrangements for final sign-ups available at the US Consulate in HK instead of a required appointment at a US port of entry • Further enhancement of the speed and courtesy of visitor processing at points of entry to the US to further encourage tourism, investment and a more welcoming image abroad • Assistance specifically from the Federal Maritime Commission in confirming with the HK government the importance of Hong Kong’s free, safe and efficient port to US trade and security, and the value of keeping the port operationally strong • Continued attention to the burden of worldwide taxation on overseas Americans and the preference for a territorial tax system for business and individuals • Monitoring of FATCA implementation, as it has serious negative impact on business costs and the US’s international image

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Brookings Institution: Michael Klosson (second from right), Kenneth Lieberthal (fifth from right) and Richard Bush (center)

The delegation encountered a range of comments – and commentary – on these topics. Hong Kong’s visa-free travel is a long-standing AmCham Hong Kong talking point in briefings year round. No promises yet, but the Chamber will keep at it. Perhaps the widest range of responses concerned the Trans-Pacific Partnership. The expectations ranged from “TPP is guaranteed to fail” to “It’s not a question of if, but when.” No one expects much action until after the US mid-term elections in early November. From then, through the end of the lame-duck Congress early next year, it will be a key time for action. Japan’s negotiation stance is also a major factor.

China “Is it easier or tougher to do business in China?” To this frequently asked question, the delegation pointed out that the Chinese economy has become too large, and US investment and involvement too deep and intertwined, to give a simple answer. They said that it depends on such facts as which industrial sector one is assessing, the nature of the investment, the number and quality of Chinese competitors, the history of the company’s involvement in Chinese markets, the relationships the company has with regulators, and the size of the company and its management structure. Nevertheless, the delegation highlighted several trends that cut across industries and created considerable challenges to doing business in China – • A strong government preference for supporting domestic firms, primarily state-owned enterprises but also local privately owned firms • Increasing regulation, which has impact not only on international investors but also Chinese domestic ones • An end to cheap, docile labor and greater reluctance for laborers to relocate away from home provinces

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Dept of Commerce: Principal Deputy Assistant Secretary John Andersen

• A government desire to build and protect local champions “Our opportunities to exchange views in closed-door sessions gave us good perspectives on what Washington is thinking about China and Asia in general,” says AmCham Governor Robert Grieves. “We engaged in genuine discussions – and we saw the right kind of people, from think tanks to the Pentagon. We were able to use our access to explain what AmCham can contribute to policy discussions.”

Sino-US trade relations Many interlocutors questioned the Doorknockers about corruption in China. The team reported that China’s leadership appears more committed to taking on corruption than expected, going broader and deeper to root it out. But, in the near term, many companies are seeing a degree of paralysis among government officials and Chinese firms regarding investment decisions. The fear of being identified for corrupt decisions or actions is very much an issue for the present. But, as one executive pointed out, “Our view is that it is positive in the mid to long term for [Chinese] companies that want to play by the rules.”

National Security Council: Director for China & Korea Nancy Leou (third from right)

made high-value food and beverages in Asia, taking advantage of widespread confidence in the quality and safety of US food products • Specific attention at State and Homeland Security to facilitating China business and tourist travel to the United States – and better information on the opportunities for investment at the state and municipal levels • Emphasis on the importance of participation by President Obama at the November APEC meeting in China as sending a reinforced message about the genuineness of America’s “pivot” or rebalancing toward Asia economically • Concerns about increasing tensions and volatility in the East and South China seas that might be a threat to freedom of navigation in international waters The discussions revealed a sense that Washington sees increasing tension in the US-China bilateral relationship. As one senior think tank researcher stated in a breakfast meeting with the delegation, “The US-China relationship is not in trouble, but it is troubled.”

Regulatory Woes Vice President Joe Biden’s Office: Ed Shin, Advisor for Asia (fourth from left)

Another executive pointed out that “China is trying to upgrade and be more international, but it is experiencing ‘change management’ pain. Some of these changes are better for US companies doing business in China. For example, the reform going on that makes bribery harder puts foreign firms on better footing – not yet equal, but at least better.” The delegation delivered various China/Asia-related “wishes” during the week, all of which addressed AmCham’s ongoing concern that the US become increasingly competitive in Asia and that through increased trade and investment it can create more US jobs • Deeper engagement by US agencies in coordinating expansion of US investment and trade in Asia, especially using Hong Kong as a source for traderelated services – particularly in taking advantage of expanded opportunities for US high-value goods and services for Asia’s growing middle class (China and Southeast Asia) • Broad support for successful Trans-Pacific Partnership (TPP) negotiations, stressing the need for TPA (Trade Promotion Authority) for the President to also be approved on the Hill • More joint efforts by the Foreign Commercial Service and the Foreign Agricultural Service in taking advantage of the huge opportunities for sales of US SME-

Several discussions included assessments of China’s changing regulatory environment, which has become a growing burden on many foreign companies – particularly in the service industries – operating in the country. Beyond more detailed rules on compliance, which are increasing rapidly, the uneven application of new regulations is no less worrisome. As one AmCham executive pointed out prior to the trip, “China’s state-owned enterprises (SOEs) are de facto if not always de jure exempt from certain regulatory requirements, especially ‘small’ issues such as inspections and fines. In addition, China’s private domestic firms have a greater ability to pay small bribes (often in the form of hiring, favors, meals, and gifts rather than outright cash).” These approaches to doing business are of course not options for foreign firms operating under quite different company values, as well as US rules (such as the FCPA) that carry substantial legal penalties. As another member reported, “The business environment is worse now than a couple of years ago, primarily caused by uneven competition from SOEs. Business is also getting tougher because of IP protection issues, lack of enforcement of environmental laws, and an uneven playing field due to ‘relationships’ among local firms and government.” Although the new Chinese administration has promised to reduce the administrative burden on industry, the early signs are not encouraging. The delegation expressed a cautious “wait and see” attitude toward China’s ambitious economic reform agenda.

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Service industry challenges The Doorknock delegation repeated one talking point discussed frequently in meetings over the past year – the need for a “rethink” on foreign direct investment in China. China has long utilized foreign investment to achieve its goals. In its policies and pronouncements about FDI, it has diligently focused on what it needs and what foreigners can provide. China still seeks specific technologies and service industry expertise, but its goals are increasingly out of sync with what foreign investors are willing and able to provide. It was one thing to provide technology transfers when Chinese firms were small, unsophisticated and less competitive. It is quite another to do it when those firms are larger, more competitive and are supported by a government that has shown a willingness to subsidize their expansion through access to cheap sources of capital. As for investment in service industries, the AmCham delegation made a distinction between traditional FDI and a subset of investment that is talent intensive instead of capital intensive – the need for China to focus on so-called FDE (Foreign Direct Expertise) and to find ways to provide incentives for such investment by foreign firms. In many cases, talent-intensive investments need to be attracted, measured and evaluated differently from traditional FDI. For instance, beyond basic market access issues, service industry investors often need to acquire a large number of work permits in order to bring the expertise needed for their operations in China. If these are tied to large, capital-intensive expenditures, it’s a no starter. Success in FDE means greater investment in human infrastructure – bringing talented and experienced people who can help raise the quality of China’s service industries, and less focus on building additional physical infrastructure. This requires adjustments to how central, provincial and municipal officials are evaluated for their success at attracting investments. Simple dollar calculations are less relevant for FDE.

Going forward “China’s attempts at reform and its success in doing so is a developing story that AmCham monitors closely,” says Levesque. “But we also explained in Washington that we follow business development opportunities throughout Asia, especially in South and Southeast Asia, because so many of our members have broad geographical responsibilities.” “We continuously draw upon knowledge and insights from our AmCham members – and also give them opportunities to directly or indirectly inform officials and other VIPs about the important roles that Hong Kong plays regionally and globally,” he adds. “Our Washington Doorknock is a good example of how we benefit our members and also contribute to policy dialogues.”

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Primary Meetings 2014 Washington Doorknock Each year AmCham Hong Kong holds in-depth discussions on a number of critical issues with policy makers in Washington DC. This year, AmCham’s delegation has met with the following groups US Government White House • Vice President’s Office • National Security Council Department of State • East Asian & Pacific Affairs • Economic and Business Affairs Department of Commerce • International Trade Administration Department of Agriculture • Deputy Secretary • Foreign Agricultural Service – Asia Division Federal Maritime Commission Pentagon • The Joint Staff – Strategic Plans & Policy Congress • Senate • House

Think Tanks & Other Organizations The Brookings Institution Center for Strategic & International Studies (CSIS) Stimson Center American Institute in Taiwan US-Taiwan Business Council

Universities - China Scholars The Johns Hopkins University/SAIS George Washington University Georgetown University

Private Consultants/Law Firms (China/Asia Trade) Baker Hostetler Forbes-Tate Sandler, Travis & Rosenberg Various private consultants

TRANSPORTATION & LOGISTICS

Victor Lee

American Airlines Inaugurates HK-DFW Nonstop Service America’s namesake airline launched in June a daily direct nonstop flight between Hong Kong and Dallas-Fort Worth (DFW), for the very first time flying its own branded aircraft between Hong Kong and the United States for a 16-hour journey. Victor Lee, Commercial Director for Hong Kong and Macau at American Airlines, talks about the airline’s longest flight at 8,119 miles, as well as Asia’s growing importance in the aviation market

By Blessing Waung

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“E

verything’s bigger in Texas” is a go-to catchphrase in the famed Lone Star State, and American Airlines aims to make it known here in Hong Kong. America’s namesake airline has launched in June a daily direct nonstop flight between Hong Kong and Dallas-Fort Worth (DFW), for the very first time flying its own branded aircraft between Hong Kong and the United States. The 16-hour journey to Texas is the airline’s longest flight at 8,119 miles and is one of the longest in the world. Victor Lee, Commercial Director for Hong Kong and Macau, is an industry veteran who has been with the company for 13 years. Until recently, Lee was Managing Director of Greater China for American Airlines based in Shanghai. During his career with American, he has helped launch all of the flights connecting to the US from Mainland China and Taiwan. Having moved to Hong Kong in March, he is exuberant about working with his team here to replicate the success the airline achieved in the Mainland. In addition to the service between Hong Kong and Dallas-Fort Worth, American Airlines has launched simultaneously its Shanghai to DallasFort Worth route – all in time to serve a growing market in Greater China. “We constantly evaluate the potential of a market and watch very closely the development and growth trends,” Lee says. “When the time is right, we just fly in.”

Why DallasFort Worth Many industry experts have raised the question about the business case of a direct flight between Hong Kong and Dallas, and there are plenty of good reasons to provide connectivity linking two of the most economically important cities in the world. Dallas is in fact one of the key investment cities in the US for Hong Kong, according to Clement Leung, Hong Kong’s

A whole new experience

Commissioner for Economic and Trade Affairs to the US. With more than a dozen Fortune 500 companies headquartered in the Dallas-Fort Worth metropolitan area (and some others in nearby Houston and San Antonio), Texas is a prominent financial and commercial hub of the southwest United States. Business ties between Texas and Hong Kong as well as China are only growing stronger, especially as a growing number of Chinese tourists and investors becomes more internationalized and continues to look for outbound opportunities.

The energy sector, particularly in oil and gas, is a pillar industry in Texas where many large companies are based, Lee points out. Furthermore, numerous trading companies or factories based in Shenzhen are commercially tied to companies in Latin America, making Texas strategically important not only by itself but also as a springboard to further reach markets throughout Central and South America. American Airlines – headquartered in Fort Worth – has played an important role in the growth of the DallasFort Worth International Airport. In

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2013, the number of international passenger arrivals at DFW Airport grew nearly 10 percent. With the launch of the two daily flights to and from Hong Kong and Shanghai, American Airlines has a new capacity to connect some 8,000 additional passengers traveling between the US and Asia every week. So far, no single hub serves as a dominant gateway for the Asia-Latin America market, but this is about to change as a result of the new nonstop flights to and from DFW. While Miami is the largest hub for flights flying between the US and Latin America,

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Florida is simply too far away from Asia for any commercial airliner to operate profitably without a fuel stop, hence making Dallas an ideal transit point. Latin America is indeed a key international destination in and out of Dallas-Fort Worth Airport, with just under half of all of its international seats flying to and from its neighboring continent. Passengers can conveniently reach more than 200 destinations to key business destinations in South America such as Rio de Janeiro, Sao Paulo, Buenos Aires, Lima, and more.

Within a network serving more than 339 destinations in 54 countries and territories, American Airlines operates more than 6,700 daily flights from hubs in Charlotte, Chicago, Dallas-Fort Worth, Los Angeles, Miami, New York, Philadelphia, Phoenix and Washington DC. It is currently the largest US carrier for destinations in Latin America, with routes covering all major cities across two continents. Traveling from Asia to Latin America, business travelers currently have the option to fly eastbound or westbound, stopping through Europe if they choose the latter. However, because Hong Kong is closely tied to the US for the purpose of commerce or otherwise, Lee believes the new nonstop flight best facilitates a trip where the traveler can take care of business in the US in a single journey while having an option of easily connecting to all other cities in the Americas. “It’s not just business traveling,” Lee says. “We can actually give people the convenience to travel onward to the Southeast of the United States, Latin America, and the Caribbean.” Meanwhile, China is also a critical inbound market for the US and in particular Texas. It is a market segment served by American Airlines through its daily flights to Chicago and Los Angeles – and now Dallas-Fort Worth – out of Shanghai’s Pudong International Airport and a flight to Chicago out of Beijing. Just last year, more than 20,000 Chinese visitors arrived to the metropolitan area of Dallas/Fort Worth as their final destination via the DFW Airport – an increase of over 60 percent compared to just five years ago. According to the Dallas Convention & Visitors Bureau, Chinese visitors spend an average of 16 nights in hotels while visiting Dallas – about twice as long as any other international visitors and more than half of them as business travelers.

Though technically Hong Kong is a new destination for American Airlines, the company has enjoyed a longstanding partnership with Cathay Pacific Airways in a comprehensive network of flights along the Pacific Rim. The new DFW-bound flight is a strategically important addition to the existing codeshare flights with Cathay Pacific and will only strengthen the overall network connecting Asia to Latin America, Lee believes. American also partners with Japan Airlines in Asia, Qantas in Australia, and British Airways in Europe. Malaysia Airlines has also announced in July that it would codeshare the service to Dallas from Hong Kong, further expanding the network within Asia. “We often get asked about whether we are looking to enter into different and new markets, and the answer is yes.” Lee says. “As a US carrier, American Airlines actually supports competition, because it is healthy for you to grow, to develop, and to become better. We consider competition necessary and essential.” “We will continue to expand in Asia, using our latest planes like the Boeing 777-300ER and 787 Dreamliner. We are also retrofitting our fleet of 777-200ERs for a refreshed in-flight experience,” he says. “All these planes will be deployed to Asia in the future as we continue to expand in this part of the world.”

Center of the world After its merger with US Airways in 2013, American Airlines became the world’s largest airline by both fleet size and passengers carried yearly. The flight marks the first time American Airlines deploys a brand-new Boeing 777-300ER aircraft, its flagship aircraft, to Asia. The aircraft, which Lee calls “the best airplane we’ve ever had,” itself is a critical component of American’s expectation of success with this route. It features lie-flat beds in 66 first and business class seats, a walk-up bar and personal in-flight entertainment system with larger screens to view the selection

of over 250 movies at a given time. Crucially, WiFi is available for the entirety of the flight in all of its cabins for a small fee. “Anyone who travels on our flight will feel they’re entering a whole new world,” Lee says. “Even we, who fly so much, are amazed. It’s a thrilling experience.” For now, Lee expects to focus on the market here in Hong Kong – an emphasis that will be reflected in the overall marketing and sales strategy. “My core focus will still be Hong Kong. You will continue to see our branding in this market,” he says. “After all, the Hong Kong business community is whom we are looking to serve, so we need to really listen to them about what they really need from us.” “My expectation for the future is that we will go beyond the market in the Pearl River Delta region and find a way to serve the markets in Southeast Asia

including Singapore, Taiwan, Thailand and Vietnam,” he adds. “At this time, we are in a listening stage seeking customer feedback. This will enable us to fine-tune our products.” With some 600-700 new aircrafts on order, American Airlines has made Asia a critical component of its plans for growth and expansion. The airline is famous in the industry for always being ahead of others in terms of strategy, Lee says, noting innovations – including the hub-and-spoke concept and global distribution computer system – that have been widely adopted in the industry worldwide. “We tend to think far ahead and look at things from a global perspective,” Lee says. “You need to be someone who’s willing to compete in the market all the time and have foresight. That’s why we want to look at the future and make decisions now.”

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HOSPITALITY & TOURISM

A Gateway of Unlimited Potential In Hong Kong as part of a delegation for American Airlines’ inaugural flight to Dallas-Fort Worth, Phillip J Jones, President and CEO of Dallas Convention & Visitors Bureau, speaks of “big” business opportunities with Hong Kong and China in the fourth largest metropolitan area in the US

By Kenny Lau

ith the launch of direct non-stop flights between Dallas-Fort Worth (DFW) in the US state of Texas and Hong Kong as well as Shanghai on American Airlines, “big” business opportunities are about to revolutionize the commercial ties of two of Asia’s most important financial centers to one of the fastest growing metropolitan areas in the United States. China is one of the fastest growing inbound markets for Texas, and the number of Chinese visitors will continue to increase, not only because traveling from Asia to Texas is now faster and more direct but also because Dallas and Fort Worth are positioning themselves to “stay ahead of the competition” and are

undergoing tremendous development to become one of the top hubs for business, innovation and tourism in the US. “Texas and Dallas, in general, are not as well-known in the Chinese market. One reason is that we didn’t have a lot of flights coming directly from Asia into Texas,” Phillip J Jones, President and CEO of Dallas Convention & Visitors Bureau, says in an interview with biz.hk, while in Hong Kong as part of a delegation for the inaugural flight to DFW Airport. “That is going to change as a result of these direct non-stop flights; I can see easily foresee the number of Chinese visitors to our area increasing to 100,000 in five years,” he says. “When a visitor from Hong Kong or China comes to our city and state, we want to showcase what the region has to offer.”

Photos: Dallas Convention & Visitors Bureau

Texas today In addition to a rich heritage for all it is known, Texas today is a very diverse, thriving state with a business-friendly environment where many Fortune 500 companies are headquartered, with more than a dozen in the Dallas-Fort Worth area and others in Houston, San Antonio and Austin. “It is a thriving economic powerhouse for the country,” Jones says. “If you look at the numbers of job created, Texas leads the nation. People across the US and the world are moving to Texas for opportunities because it is a great, easy place to do business and it is very friendly to visitors from around the world.” “What Dallas offers in terms of connections is a gateway to Texas,” he

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says. “It is located in the middle of the country where you can get to either coast and most other domestic cities very easily within 2 or 3 hours by flight – with our airport at DFW, we have flights to 60 non-stop international destinations and 148 domestic cities. Easy transportation is a real plus for us as a hub for the country.” Texas is also a great tourism destination, Jones adds. “As a destination, it is not your traditional California, New York or Las Vegas. It is a different kind of American experience. It is what we offer when you have already been to those other cities or are looking for something uniquely Texan.” “It is still a large state with a rural population. If you are looking for cowboys, horses and ranches, we have

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that to offer,” he notes. “If you are looking for the best shopping in the country outside of New York City or Los Angeles, you will find that in Dallas, where top department stores and fashion markets are based. Every designer brand you find in LA or New York, you also find in Dallas.” And, there is more, Jones continues. “We are also one of the top cultural destinations in the country. Dallas alone has some of the best arboretums, zoos, opera houses, theaters and cultural centers in the US. All around, we are making billions of dollars of investment in new architectural and civic projects.” “Between what Dallas offers as a gateway and Texas as a destination, people are going to be very impressed and surprised about the transformation

of the city and the state in the last few years,” he says.

“Big things” With some US$15–20 billion of investment in and around downtown and a citywide revitalization initiative on linking previously isolated neighborhoods, Dallas is undergoing an “amazing transformation.” As a result, it is becoming very popular as a visitor destination and as one of the top five meeting and convention cities in the US today. “We are truly one of the top business hubs. It is where big things happen,” Jones says. “For a visitor from Hong Kong or China, it means that if you are looking to do business in the US, Dallas is a great gateway for you because we now

have daily flights to Shanghai and Hong Kong.” “It is very easy to do business in Texas because we have just the right business environment in which low taxes and regulations are very attractive propositions. That is a real plus for anyone looking for business opportunities,” he adds. Texas is also home to a number of highly ranked education institutions that have nurtured generations of young talent. Moreover, young innovative entrepreneurs are relocating to Texas, in particular Dallas, because of the job opportunities, Jones points out. In other words, there is a large pool of talent from which investors could find the right partner for their business ventures. “We are leading the nation in terms of job creation and economic growth,” he notes. As a result, people are moving in, with 1.2 million from out of state into the DFW area in the last six years, making us one of the fastest growing metropolitan areas in the US. “Right now, DFW is the number four metropolitan area in the US, behind New York, Los Angeles and Chicago. If we keep growing at the current pace, we should surpass Chicago by the year 2030 based on population.”

Business hub of the Southwest When Dallas was established 150 years ago, it merely started as a trading post and grew to become a commercial entrepot at a time when cotton was king. It has since reinvented itself and thrived in an array of industries including oil and gas as well as banking and other professional services. “In a national economic transition, we see more and more corporations focus on technology, transportation and healthcare – which are three key areas in the DFW area,” Jones says. “It is becoming the preeminent city in all these critical industry sectors not just for the Southwest but for the entire country. “It is becoming a very diverse and well-rounded city. That’s why Dallas was able to bounce back more quickly than the rest of the country following the

economic recession in recent times.” “So, we aren’t just tied to only one particular industry like oil and gas. It is a diverse, vibrant local economy,” he adds. “In fact, we have a lot of companies in the technology sector and are called the ‘Silicon Prairie.’ DFW is number 3 in terms of technology-related jobs, only behind San Jose and Silicon Valley in California.” Dallas is also a “must stop” for conventions and exhibitions and is host to many mega events. It is currently among the top five convention cities in the US (others are Chicago, Las Vegas, Orlando and San Francisco). “We have the infrastructure – including 75,000 hotel rooms in DFW – to accommodate big meetings and conventions,” Jones says. “We are a place for global conferences also because of our location and corporate base.” “Our philosophy in Dallas is that we are open to business and that we want to be a business friendly city,” he adds, noting a shift of MNCs relocating their headquarters from other states to the area. “We have incentives in the form of tax credits for businesses to create more jobs. That makes it very attractive for corporations to relocate.” Incentives and policies are key to staying ahead of the competition, Jones stresses. “When you are in the middle of the country, you have to have sometime special and extra to offer. What we have been able to do is to collectively as a state and more specifically as a city to position ourselves to become an economic engine for the country. “We believe it is working because many of the companies relocating and adding jobs to our area.”

Market outlook Markets in Asia, particularly China, are “hugely important” when it comes to economic ties, Jones believes. “This is the most important emerging market for Dallas and Texas, and frankly, for the world,” he says. “If you are not in this market and haven’t had the opportunity to really take a look at the potential, you should because it is amazing. “We recognize this is a market that

Phillip J Jones

has the most potential than any other regions in the world. So, we need to be here and we need to be here in a big way.” “More importantly, we have a great product to offer – a very unique American experience that you can’t find anywhere else,” he adds. “You can learn to ride a horse on a ranch in the countryside and at the same time enjoy the urban fun and excitement in the city with all the cultural, shopping and dinning experience that you’d expect in a top-tier destination.” The direct nonstop services on American Airlines to DFW from Hong Kong and Shanghai are a game changer, Jones believes, “because it gives us an opportunity to make it as simple as possible for visitors and business travelers.” “What’s interesting is that Latin America is looking at Dallas as a gateway to Asia – and it makes perfect sense,” he says. “We are well positioned to serve both Asia and Latin America as the convenient hub to connect both regions of the world. “I sense that at some point we will overtake Miami to become the primary gateway to and from Brazil, Argentina, Columbia, Peru and Chile, especially when it comes to the markets in Asia.” “It is an interesting time for us and we believe Dallas is the city of the future,” Jones says. “It is poised be the next hot thing in the US in the coming decade as a destination to visit and a place to do business. You simply get so much more for your money in Texas.”

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A Uniquely Texan Experience By Kenny Lau

ecognized in 2007 as one of the “10 Top Texas Retreats” in Southern Living, Wildcatter Ranch is one of a kind get-away resort that is a unique combination of nature, history, fun and a cowboy experience, with luxurious surroundings in a relaxed environment – a traveler’s dream vacation that is authentically Texan. “Texas is certainly a big part of America geographically and culturally, and many people go straight to the idea of a cowboy when it comes to Texas,” says Anne Street, owner of Wildcatter Ranch, speaking in Hong Kong as part of a delegation promoting inbound tourism to the United States amid the launch of American Airlines’ maiden flights from Shanghai and Hong Kong to Dallas-Fort Worth. “When we were approached about a decade ago by the Dallas Convention and Visitors Bureau for the idea of opening up our ranch for tourism, we immediately thought it was a perfect idea because we could invite people not only within the US but from all over the world to come and experience a great part of Texas,” she says. The Wildcatter Ranch is located near Graham, Texas and about a 90-minute drive northwest of the Dallas-Fort Worth International Airport. It is situated on 1,500 acres of beautiful, diverse Texas landscape in the North Texas Hill Country where “you will hear the sound of coyotes, crickets and frogs at night,” Street describes. “The ranch is abundant with soft grazing bottomlands, rugged hill terrain covered with rocks, cacti, mesquite, oak and juniper trees, and breathtaking views of the historic Brazos River,” she adds. The ranch dates back to 1870 when Colonel E.S. Graham (founder of Graham, Texas, and Street’s great grandfather) originally purchased the land. In fact, many of Texas’ historic moments took place near it. Stories of frontier forts, conflicts with American Indians and cattle drives – which took place during the

second half of the 19th century before the oil boom – are told in a multitude of books and movies. Today, it is a resort of luxury with unique features and characteristics that can only be found in Texas. “Our idea is for our guests to experience the cowboy way of life,” Street says. “They can get their hands dirty but still sleep in a comfy bed at night.” “The ranch gives our guests the opportunity to go out and ride a horse, get up close to the longhorn, engage in a variety of outdoor activities, or simply enjoy the scenery in a wide open space,” she says. “We have 25 miles of horseback riding trails, and you can take a ride everyday on a different trail with lots of elevation and amazing views.” “The other thing people really enjoy doing is sporting clays. That is always fun because people

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can find themselves in a lifestyle of the Old West,” she adds. “And, you can learn about the rich history of our area. We all love to tell our stories and bring you into the heart of Texas.” “The sunset is just magnificent,” Street says. “You can see a crystal clear sky that constantly changes when the day turns into night. On a clear night when the moon is not full, you can even see a milky way out on the ranch. It is so beautiful that you can just sit there and watch forever.” The ranch is a year-round destination. The weather can be hot in the summer, with temperature reaching up to 35-38 Celsius degrees, but it is not humid. While there can be a few “really cold days,” it normally averages about 13 degrees in the wintertime. The best time to visit during the year is between September and November, and from

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March into early June – a time when “flowers blossom and are just beautiful.” “More than half of our guests are leisure travelers and people coming for a holiday, and about 70 percent come from outside the US,” Street says. “We really want to welcome the world to Texas. This is very important to me because what we have is really something special – a cultural experience that is unique, warm and fun.” “Our Chinese guests who have come to enjoy a vacation on our ranch just loved it. They walked through the cabin house and just screamed with joy,” she says. “With direct flights from Hong Kong and Shanghai to DFW, many more Chinese tourists are going to be pleasantly surprised. The area is definitely worth a visit and not just a place to change planes and go somewhere else.”

INFORMATION & COMMUNICATIONS TECHNOLOGY

ccording to a recent report by The Wall Street Journal, more and more companies are taking the initiative to fend against cyberthreats amid a series of high-profile data breaches, including the theft of more than 40 million credit and debit card numbers from US retailer Target last year – a malicious attack that has put corporations on high alert. The news report in the Journal also highlighted a growing emphasis among companies on putting tremendous resources to tackling risks coming from the online world. In 2012, food manufacturer Kellogg created a security team and hired its first chief information security officer Steven Young. Similarly, Delta Air Lines added a board member with expertise in information technology security, while Exxon Mobil initiated a testing system to see if employees would respond to suspicious emails. “One of the most common misunderstandings [about cybercrime] is that people think it can’t happen to them,” says Ian Christofis, Verizon’s Head of Identity & Privacy Services APAC. “The reality is that everyone is essentially a target.” “This is the biggest set of data available of its time,” Christofis notes of the 2014 report. “We can see some changes in trends, and because we’ve got that much data, we are getting much more reliable information.”

FIGHTING AGAINST A VIRTUAL ENEMY

In collaboration with 50 international IT, cyber security and law enforcement organizations, Verizon has recently released its annual Data Breach Investigations Report, compiling and analyzing more than 63,000 online incidents of security breach in 95 countries across 19 industry categories. In the 2014 report, security experts reveal nine patterns of cybercrime and make a number of recommendations for companies to stay protected

A year in review

By Yuen-Chong Lau

Photo: Thinkstock

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Instead of presenting specific vectors of cyberattacks as in previous reports, Verizon’s researchers summed them up into overarching patterns that describe 92 percent of the 100,000 security incidents analyzed over the past decade. And, these patterns are: miscellaneous errors, crimeware, insider and privilege misuse, physical theft and loss, web app attacks, denial of service attacks, cyber espionage, point-of-sale (POS) intrusions and payment card skimmers. Of the nine patterns, the top three comprised 72 percent of the incidents in any industry. “I think we succeeded this year in trying to make it more directly actionable,” says Christofis. “From the report, we can see what the most prevalent attacks for each industry are. I can specifically look at what are the main characteristics of that type of attack, how do I protect against it, what are the main recommendations and so on.” From the data set, Verizon found that the number one action used to compromise information was the use of stolen and/or misused credentials such as usernames and passwords. In fact, two-thirds of breaches happen as a result of weak or stolen passwords. “Passwords are not a very good way to secure access because people have very limited abilities to manage them,” says Christofis.

“Either companies should be offering two-factor authentication or end users should use a password protection software that keeps their passwords safe under a master password,” he suggests. “Every time they want to do something, they can look up the password for that service.” Christofis assures that two-factor authentication is becoming the trend, especially with the surge of smartphones that make it easy and less costly to deploy. The two-step process of verifying one’s identification is stronger than just using passwords and a common practice in industries such as the banking sector. “You will see, for example, a change recently in Hong Kong where banks have gone from just two-factor authentication for login to being able to do transactionbased authentication or require a PIN to unlock a two-factor device,” says Christofis.

“I think that’s partly a combination of increased prevalence, but probably also increased attention as well,” explains Christofis. “About half of the incidents we see are breaches, which probably means there is a lot more cyber espionage going on that is not being detected.” The public, professional and manufacturing sectors are the greatest victims of cyber espionage. Attackers look for intellectual property from military, delve into contracts in engineering and design, or target manufacturers for technology and business processes. In terms of origins of attack, China, North Korea and Eastern Europe are the leading places. However, Christofis maintains that cyber attacks can originate from anywhere and are coming from all over the world. “Some of it is based on awareness,” he says. “What you look for, you find to some extent.” According to the report, most cyber espionage attacks and POS intrusions that were designed to deliberately capture payment data took weeks – or even months – before they were discovered (often by external parties). These were attacks carried out remotely targeting retail transactions in restaurants, hotels, grocery stores and other “brick-and-mortar” retailers.

Detection Another highlight from the 2014 report is the threefold increase in cyber-espionage attacks, whereby state-affiliated actors gain access to intellectual property often through targeted “phishing” attacks.

Frequency of incident classification patterns 2013 incidents, n=63,437

2013 breaches, n=1,367 POS Intrusions

14% 35%

<1%

Miscellaneous Errors

21%

14% 25%

1% 4%

20% 9%

Card Skimmers

18%

Crimeware

14%

<1%

Cyber-espionage Everything else

Physical Theft/Loss

DoS Attacks

31%

<1%

Web App Attacks Insider Misuse

2011-2013 breaches, n=2,861

22% 6%

15% 12%

Source: Verizon's 2014 Data Breach Investigations Report

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Generally, organizations are unaware of – and unable to discover – POS intrusions until criminals cash in or upon law enforcement and fraud detection notification. In some case, cyber espionage attacks are discovered by the intelligence community and research organizations. “A lot of detection is coming from the end users,” says Christofis. “People are noticing when things go wrong, because their awareness has heightened to look for abnormalities and pick up on things.” “So, awareness and training among users is actually a very useful thing to do – we need to try to get them to not only be aware of their responsibilities to protect data but also potentially pick up on what might be going wrong,” he adds.

DoS attacks “Denial of service” (DoS) attacks are hostile acts intended to disrupt or compromise the availability of a network or system. Data shows a 115 percent increase since 2011 in these attacks incited by “botnets” (a network of Internet-connected computers that are often associated with malicious intent) and “reflection attacks” in which victims receive seemingly legitimate traffic from attackers who disguise their origin by reflecting it off a third party. “Attackers are getting smarter about how they do denial of service attacks,” says Christofis. “They are saying, ‘Rather than give me a home PC with a limited trickle feed Internet connection, why don’t I go for a server, a data room or cloud center somewhere that has a massive pipe to the Internet where I can pump a whole lot of data out of?’” In March 2013, anti-spam organization Spamhaus suffered from one of the largest cyber attack to date – a massive DoS attack incited by DNS (Domain Name System) reflection. The company’s website was bombarded by an overflow of malicious data traffic. The attack was so large that it saturated Spamhaus’ connection to the rest of the Internet and forced the site offline. With the use of DoS mitigation service provider Cloudfare, attacks on Spamhaus are said to have largely subsided, but “like almost every piece of infrastructure on the Internet, [they] are constantly under attacks of various scales.” “There’s always a limit to what your technology can do,” Christofis stresses. “It has to get down to people as well. So, it has to be policies, governance and people, not just technology.” Christofis recommends a two-pronged approach when it comes to fighting cybercrime. “If you look at the recommendations in the report and do all the basics right, you’re 95 percent safe [against opportunistic attacks],” he says.

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Ian Christofis

“But against targeted attacks, you need to be very careful and know what your crown jewels are and then go to extra lengths to protect them properly,” he adds. “You want to separate things, make it harder to get from one part of the network to the next part and protect the data that is particularly vulnerable or sensitive.”

The local situation The Hong Kong Police Technology Crime Division reported a HK$916.75 million (US$117.5 million) loss in 2013 from 5,133 cybercrime cases attributed to online games, online business fraud, unauthorized access and other attacks. It is a substantial increased when compared to a total loss of HK$60.38 million (US$7.74 million) from 2,206 cases in 2011. “I think Hong Kong is much like the rest of the world,” says Christofis. “It’s part of the advanced economies of the world so it fits the general [global] pattern.” With mobile devices and different operating systems, Christofis says it will be more difficult for people to be in control. “If someone is looking at a document, it could be running on Windows, Linux, iOS or Android,” he explains. “You need to focus on the data, not the perimeter. The boundaries don’t exist.” Another trend Christofis foresees is the shift towards big data, or massive volumes of both structured and unstructured data that require technology other than traditional databases and software. “They’re the big things that are changing the world,” he says. “They are both opportunities and threats,” he notes. “If you’ve got a whole load of devices collecting data constantly, then there’s a lot of opportunity for that to be misused against people. So, I think you’ll see a lot more shift towards people controlling their own data.”

TELECOMMUNICATIONS

hose who travel frequently for work have cause to anticipate with apprehension the arrival of their next mobile phone bill. Roaming charges for calls, texts and data use can often add up to an unexpectedly large sum. But those days – and those hefty bills – could soon be a thing of the past if the strategy of mobile network operator Truphone reaches its potential. Truphone, a UK company founded in 2006 with about 750 employees in ten different countries, operates a mobile network in more than 20 countries. The company has launched in early June a new service that permits Hong Kong corporate users to use their mobile phones’ voice, data and text allowances in any of 66 locations worldwide as if they were using them in Hong Kong.

Localized tariff

Long Distance Calls, Local Charges The escalating cost of international wireless roaming is a constant challenge for business travelers – and their companies – despite a strong business case for employees to remain in instant contact with their customers, colleagues and family. Amid a fast-changing landscape in the use of mobile devices, one telecommunications company is moving ahead with an unprecedented model to help businesses meet their growing needs of mobile connectivity across international borders

By Liana Cafolla

biz.hk 7-8 • 2014

Under the new plan, called “Truphone World,” all charges for calls, text and data are deducted from the user’s tariff plan at local rates, resulting in massive savings for users, or more likely, their employers. For example, for a Hong Kongbased company that frequently places calls to the US or vice versa, the cost of calls for Truphone subscribers will be significantly lower as a result of the new initiative. The service, which is currently targeting business customers only, could easily cut companies’ mobile costs by upwards of 90 percent, says Dr Alex Ip, Senior Vice President for Asia Pacific at Truphone. “It’s a local call, it’s a free call. Previously, it would be roaming,” he explains. Among the 66 countries included within the network are China, Japan and Singapore, plus about 70 percent of the world’s most important business destinations. Eight of these countries – dubbed the ‘Truphone Zone’ – form the hub of the network for users in Hong Kong, the UK, the US, Australia, Germany, Spain, the Netherlands and Poland.

How often do employees travel internationally on average? 73.3 %

4 or more trips

65.0 % 26.7 %

3 or fewer trips

35.0 %

Large Enterprise

Midmarket

Source: International Mobile Communications: How to Balance Connectivity, Productivity and Cost Concerns, CCMI

Alex Ip

And, subscribers are offered the added attraction of a SIM card that can hold up to eight international numbers, one for each of the eight hub countries. That allows callers from those countries to reach the user regardless of where he or she is using a local number – and at a local tariff. “No one at the moment is offering truly global international phone numbers on one SIM card,” says Ip. “It’s a very, very cost-effective way for business people to communicate while traveling.”

A new business case The cost-effectiveness will resonate with many companies that have been struggling to find ways to cut down on the enormous cost of international

roaming services. According to a study entitled International Mobile Communications: How to Balance Connectivity, Productivity and Cost Concerns, commissioned by Truphone and carried out by CCMI Intelligent Telecom Data Solutions, companies are trying different ways to cut down their employees’ mobile use while traveling because of soaring roaming costs, but none of them are easy, popular or good for business. Mobile phones – particularly in the era of smart mobile phones – have become increasingly versatile and sophisticated, and employees are using them more and more for the purpose of work. In the report, some 49 percent of surveyed large companies – those with more than 1,000 employees – said

mobile voice usage was growing, and 39 percent of companies with 100 to 1,000 employees agreed. However, because of the cost associated with the increasing use of mobile phones while traveling across country borders, many large companies – about 59 percent of them – have either cut or restricted their employees’ use of wireless devices while abroad. But it’s a strategy with potential risks for business, as less time on the phone could damage customer relations by making employees less accessible to their customers, as well as lowering employees’ productivity. “However you slice it, the state of international roaming today is causing pain to companies, either in the form of big bills, restricted user communications, lost productivity or compromises in security,” the report indicates. As global business travel continues to grow, the question of how employees should be allowed to use their mobile devices abroad in a costeffective way has become a bigger dilemma for businesses. According to CCMI’s report, ‘high cost’ is one of the top challenges companies say they face when using international roaming. That’s also because high roaming charges, companies say, make it difficult for their employees to have access to cloud-based services and to provide proper customer support while abroad. These difficulties often lead to

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missed business opportunities. “Organizations of all sizes indicate that they feel compelled to choose between the lesser of two evils as their populations of international travelers grow – [either] let users continue to use their mobile devices just as they would in their home markets and pay dearly for the privilege, or change employee usage behavior so that they consume fewer minutes and megabytes,” the report concludes.

A changing landscape The prohibitive cost of international roaming is not a challenge unique to markets in Asia or in the US. The launch of Truphone World comes hot on the heels of a new law passed by the European Parliament in April – a legislation that creates a ‘flat fee’ charging system across the region. It essentially means that no roaming fees will be charged for using a mobile phone while in another country within the European Union and that charges made for making calls or downloading data in any EU country will be the same as in the user’s home country. The change, which is due to take effect in December 2015, follows years of complaints by European customers about high roaming costs, which have led users to curtail their Internet use while being away from their home country. Here in Asia, there are now signs of a swing towards making whole regions roaming-free, with Indonesia’s Minister for Communication and Information recently announcing his intention to make ASEAN a roaming-free zone. “What [the European Parliament] has done is basically a very sensible move,” says Ip. “It validates that the direction where we’re going is exactly where we should be going. So far, they’re only covering Europe, not the rest of the world. What we’re addressing is the rest of the world.”

Expanding mobility In terms of mobile coverage, the ‘rest of the world’ is quickly growing

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Specific problems associated with the high costs of international wireless roaming Large Enterprise

Midmarket

High wireless charges No negative impact has been reported Challenges with customer supportwhile abroad Lost productivity Lost business Lack of access to cloud-based services Lack of access to internal network resources Restricted communication Lower company credibility Complaints from employees/customers Lack of data security from unsecured, public network use

5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Source: International Mobile Communications: How to Balance Connectivity, Productivity and Cost Concerns, CCMI

bigger. According to Truphone’s research, there are now more mobile devices in the world than there are people. About 60.7 percent of the world’s population, or 4.3 billion people, now use a mobile phone, and people are increasing their mobile phone usage, with one-quarter of all Internet searches now carried out on mobile devices. The potential change to global roaming are a wakeup call to the entire mobile industry, says Ip. “For too long, users have been subject to the limitations of physical country borders when making phone calls,” he says. “We believe that this news signals a trend on the horizon for mobile phone usage to regain spontaneity – that is why it was invented. Picking up the phone to [call] your family and friends should be easy, no matter where you are in the world.”

The Truphone model is also very unique because its set-up is different from others, Ip notes. The company uses a global core network that connects in its eight core countries of coverage, and then connects to local radio network providers belonging to partners in each of the countries where it operates. “For the incumbent, it will be a lot harder because they’ve been relying on that profit stream,” he says. “We do have a very unique cost base and infrastructure, so it’s not that easy of a business model to replicate without making substantial investment. We can do something that most others can’t – that’s what makes us competitive and allows us to go in this direction.” The advent of Truphone World could be a precursor to the entire world becoming roaming-free, believes Ip. “We will make that happen. We’re already making it happen.”

CHARITABLE FOUNDATION

2013/14 AmCham Charitable Foundation Scholar Awards Tommy Chung Chinese University of Hong Kong Shawn Mak University of Hong Kong Kevin Yeung Hong Kong University of Science and Technology 2013/14 Lyn Edinger US Studies Scholarship Canny Lam St Paul’s Co-Educational College Rosemarie Ho Baptist Lui Ming Choi Secondary School Edward Tian Hong Kong International School

From left: AmCham Chairman (1995) Tom Gorman, Kevin Yeung, Tommy Chun, AmCham Charitable Foundation Chairman James Sun, Canny Lam, Rosemarie Ho, Edward Tian and AmCham Chairman (2005) Jon Zinke

students, but also an expression and hope that they will take the award, go forward, and have an infectious enthusiasm for learning.”

Fueling Hopes for a Future Generation

Lyn Edinger US Studies Scholarship

Established in 1985, the AmCham Charitable Foundation pledges to give back to the community. With the continued support and generosity of donors and long-term partners at fundraising events, it continues to contribute to educational and vocational training as well as charity projects not only as a way to improve Hong Kong’s competitiveness, but also to inspire local young people to see the world with depth and enthusiasm

The Lyn Edinger US Studies Scholarship – established in 2002 – is a HK$16,000 scholarship presented to local secondary school graduates with an exceptional academic record, leadership skills and a commitment to the community and who have been successfully admitted to a US university for a full-time undergraduate program. “The awardees are honored not only for what they have achieved academically, but also for what they are doing in the community,” Vuylsteke says. “These are well-rounded and very impressive young adults. We hope that these awards will further stimulate them to be high achievers with goals that continue to include service to the community.”

By Queenie Tsui

ummer every year is not just the end of the school year, but also a season of celebration as the AmCham Charitable Foundation gives out numerous awards to honor local secondary and university students in recognition of their academic excellence, strong leadership skills and commitment to the community.

Prize Book Awards The Prize Book Award was introduced in 1986 to recognize high school students with excellent achievements in academic subjects, community service and leadership. This year, 20 students received the award, which includes a HK$1,000 worth of book

coupons, a certificate of achievement and The Americans trilogy by Daniel J Boorstin. “There are a couple of reasons we have chosen to give this series of books over the years – it is a reading exercise that requires good thinking,” notes AmCham President Richard Vuylsteke. “By awarding these books, we are not only recognizing achievement of these

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Young Thinkers, Big Dreams Award winners for the Lyn Edinger US Studies Scholarship in 2014 – Rosemarie Ho, Edward Tian and Canny Lam – share their thoughts in a conversation with biz.hk. When asked about her aspirations, Rosemarie Ho, who will be studying at the University of Chicago this September, describes herself as someone who thoroughly enjoys investi- gating the nuances and consequences of culture. It is her passion for anthropology that she hopes would enable policymakers to better understand the complexities between antagonistic ethnic and social groups. “I hope to become a researcher for non-governmental organizations to shed light on these issues, initiating community service programs and advising the government on policies that contribute to societal cohesion,” Ho says. “My ultimate goal is to establish a cross-cultural dispute resolution center, acting as an intermediary, settling conflicts between societal groups and training anyone, from social workers to teachers, on how they could facilitate effective cross-cultural communication,” she adds. In contemplating the current ethnic dichotomy in Hong Kong, Ho says, “Ethnic tensions, in particular amongst Nepali immigrants, have been growing as Hong Kong becomes more and more exposed to different cultures.” “Currently, there is very little research on the needs of ethnic minorities, such as the extent to which new immigrants require external assistance in learning Cantonese, or naturalization courses like those seen in America and France,” she points out. Beyond the completion of her studies, Ho endeavors to be able to

identify and resolving issues of ethnic contention marring Hong Kong, including the perceived dichotomy between Mainlanders and people of Hong Kong. Edward Tian, a soon-to-be freshman at Columbia University, aspires to be a mathematician. Born in New York but raised between the US and Beijing, Tian had constantly faced transitional difficulties between English and Chinese linguistic environments until he found the most fascinating language among them all – mathematics. “I have always attempted to apply my mathematical learning to a field where I can make a difference, and I want to pursue an industry where I can do that,” Tian says. “At the same time, academia has also been a fascinatingly alluring prospect, and I may choose to research or teach.” “Although industry and academia are quite different, they are united in aspect to the purpose of why I am pursuing a higher-level education,” he continues. “I hope that by studying mathematics, I can contribute both academically and personally to the society around me.” In fact, Tian was offered to study at a university in England during his junior year of high school, but he decided to stay in Hong Kong for his senior year and to attend college in the US for broader exposure to other areas of subjects alongside mathematics. “I hope this will help me gain an understanding of other fields and how I can apply mathematics to analyse social problems and respond with a certain accuracy and elegance that the subject can produce,” he says. Canny Lam, like all other awardees, dreams to contribute to the advancement of humanity, but through the study of human cognitive and neurological development. Lam, who will be at the University of California, Berkeley, tells of her zealous academic pursuits in cognitive science. “The cognitive studies of artificial intelligence foster technological breakthroughs and improve the society’s productivity, while the cognitive studies

MARK YOUR CALENDAR The New PRC Trademark Law -

Aug What Does this Mean For Your Business?

Front row, from left: AmCham Chairman (1996) Mark Michelson, AmCham President Richard Vuylsteke and AmCham Chairman (1995) Tom Gorman, with the 2014 Prize Book Award winners

of perception and attention expand humanity’s capabilities,” she explains. Noting that cognitive science is still relatively new in Hong Kong, Lam aspires to pursue a PhD in the area to venture into scientific research related to consciousness and cognitive abilities of learning. “I seek to realize the infinite new possibilities in my career and take the road that has not been taken,” she says. “Ultimately, as an individual, I aspire to inspire others and change people’s lives for the better.” One of the social problems Lam observes in Hong Kong is the limited availability of tertiary educational opportunities. Although it is universally agreed that tertiary education raises the quality of human capital and improves productivity, she believes this is not the case in Hong Kong right now. “The lack of tertiary educational opportunities reinforces the selfperpetuating cycle of poverty, eventually worsening income inequality,” Lam points out. “A reform in the tertiary education system would be pivotal in improving both the quantity and quality of human capital in the Hong Kong economy.” “Not only would this improve the

socio economic aspect of society, but also enhances equity in our society, which is an important indicator of human development,” she believes.

Scholar Awards The Charitable Foundation Scholar Award dates back to 1977 when the Chamber sought to recognize full time MBA students from the University of Hong Kong (HKU), Chinese University of Hong Kong (CUHK) and Hong Kong University of Science and Technology (HKUST) who have achieved outstanding academic results during the first year of their studies. Award winners receive a scholarship for HK$10,000 and a Certificate of Merit. Kevin Yeung, one of the awardees in 2014, truly values the benefits of education. Although Yeung is already qualified with three degrees, he remains very modest about his achievements and upholds a strong determination to give back to the community. “I know that I have a great educational background, and I believe that I have a great work ethic, style, and speed

that will prosper in many industries,” Yeung says. “Hence, I am inspired when I can use all these skills and am able to do well not just in the business world, but also to do good for the business of society.” Shawn Mak would concur with Yeung that the key to succeed as new blood in today’s working force is to be innovative and willing to take challenges. With that in mind, Mak took a rare combination of majoring in Politics and Public Administration and European Studies during his undergraduate study, then working for several Hong Kong government departments including the Police Force and Home Affairs Department and taking another challenge to work in a public relations agency which has taken him to his current position. Mak’s willingness to take on challenges has enabled him to substantially grow and learn. “After finishing the MBA, I find that I have changed compared with myself one year ago: I get to know myself more and I know what I want to do for a career. My goal is to be an entrepreneur and start my own venture,” he says.

biz.hk 7-8 • 2014

Benjamin Choi, Partner - IP & TMT Group, Mayer Brown JSM Alan Chiu, Partner - IP & TMT Group, Mayer Brown JSM The new PRC Trademark Law, which came into effect on May 1, 2014, has introduced considerable changes to the trademark regime in China. In this seminar, the speakers will address the key changes to the law as how they affect: ˙ Trademark registration, opposition and cancellation procedures ˙ Protection of well-known trademarks ˙ Trademark squatting ˙ Trademark enforcement Benjamin Choi focuses on local and foreign trademark prosecution (portfolio management, pre-filing advice on availability and distinctiveness of trademarks for registration, and handling of official actions and contentious proceedings). He is experienced in conducting IP due diligence for merger and acquisition projects involving the transaction of IP assets. He also advises on trademark, copyright, design and patent enforcement and passing-off actions in Hong Kong and unfair competition in China, as well as domain name disputes in Hong Kong and China. Alan Chiu handles the full spectrum of contentious and non-contentious intellectual property work in both Hong Kong and China, ranging from litigation to licensing, strategic advice and portfolio management. He has substantive experience in all levels of civil and criminal IP litigation, including handling of Norwich Pharmacal application and contempt proceedings, in Hong Kong. On the China side, Chiu advises extensively on IP enforcement strategies and has significant on-the-ground experience in handling IP litigation, administrative and criminal raids and customs seizures.

Real Estate Transparency & Aug Global Investment Flows in 2014

Sep

David Green-Morgan, Global Capital Markets Research Director, JLL Alistair Meadows, Head, International Capital Group, Asia Pacific, JLL JLL’s Global Real Estate Transparency Index is a unique survey that quantifies real estate market transparency across 102 markets worldwide. The Index is updated every two years and has been charting the steady progress in real estate transparency across the globe for 15 years. The 2014 Index is the eighth edition. The Index aims to help real estate investors, corporate occupiers, retailers and hotel operators understand important differences when transacting, owning and operating in foreign markets. It is also a helpful gauge for governments and industry organizations who are seeking to improve transparency in their home markets. David Green-Morgan supports the worldwide capital markets teams, as well as the industry leading International Capital Group within JLL which focuses exclusively on cross border real estate capital movements. He is the author of the market leading Global Capital Flows report as well as countless thought leading papers and articles. Prior to joining JLL, Green-Morgan was head of Asia Pacific Research at DTZ, based in Sydney, where he ran a team of 50 researchers across 11 countries in the Asia Pacific region. Alistair Meadows heads JLL’s International Capital Group (ICG) in Asia Pacific, and is based in Singapore. The ICG is a small global team of senior JLL capital markets professionals who facilitate cross border transactions between Asia Pacific, EMEA and the Americas. A key part of Meadows’ role is to identify new sources of capital in Asia Pacific, and support those groups in their strategy to invest off-shore.

The New Asia and its Commercial Implications Ben Simpfendorfer, Managing Director and Founder, Silk Road Associates The rapid evolution of Asia’s markets is creating vast opportunities, but also new complexities. Foreign companies are having to rapidly adapt their commercial strategies to remain competitive. Where are the greatest opportunities and risks? How are MNCs adapting their business models? Ben Simpfendorfer works with a range of multinationals and mid-sized firms on their expansion strategies in Asia and the Middle East. His strategy briefings are in popular demand from such clients as KPMG and Baker & McKenzie. He has worked in Asia and the Middle East for the past 20-years. He is also co-author of the “Future for MNCs in China” reports published by KPMG in 2012 and 2014. In addition to writing a regular column for FT.com’s beyondbrics and other features for CNBC, Bloomberg and CNN, Simpfendorfer is author of The Rise of the New East (Palgrave, 2014), examining commercial opportunities and complexities in the Asia market. His recently released book is based on the result of field-research and interviews conducted in a range of cities, including Beijing, Guangzhou, Bangkok, Hanoi, Mumbai and Cairo, on a broad range of topics – from China’s e-commerce trade to India’s film industry and Thailand’s supply-chains.

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

Tel: (852) 2530 6900

Fax: (852) 2810 1289

Venue: The American Chamber of Commerce in HK 1904 Bank of America Tower 12 Harcourt Road Central, Hong Kong Time: 12:00 - 2:00pm (Sandwiches & beverages included) Fee(s): Member: HK$280 Non-member: HK$380

Venue: The American Chamber of Commerce in HK 1904 Bank of America Tower 12 Harcourt Road Central, Hong Kong Time: 12:30 - 2:00pm (Sandwiches & beverages included) Fee(s): Member: HK$280 Non-member: HK$380

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Venue: The American Chamber of Commerce in HK 1904 Bank of America Tower 12 Harcourt Road Central, Hong Kong Time: 08:00 - 09:30am (Light Breakfast included) Fee(s): Member: HK$180 Non-member: HK$280

Email: byau@amcham.org.hk

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