Opportunities for Swiss Companies in the Hong Kong Cleantech Market. March 2012. osec.ch
Opportunities for Swiss Companies in the Hongkong Cleantech Market. Title.
The Hongkong Clean Technology Market.
Language.
English
Number of pages.
28
Author.
Other Industry reports
2
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Fiducia Management Consultants http://www.fiducia-china.com/
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Table of Contents. 1
Executive Summary
4
2
Market Overview
5
2.1 2.2 2.3 2.3.1 2.3.2 2.3.3 2.3.4 2.3.5 2.3.6 2.3.7 2.4 2.4.1 2.4.2 2.4.3 2.4.4 2.4.5 2.4.6 2.4.7 2.4.8 2.4.9 2.5
Facts about Hong Kong .................................................... 5 Cleantech Market and Evolving Landscape ...................... 6 Hong Kong Environmental Protection Policies .................. 7 Air Pollution Control Ordinance ......................................... 7 Ozone Layer Protection Ordinance ................................... 7 Water Pollution Control Ordinance .................................... 7 Waste Disposal Ordinance ................................................ 7 Environmental Impact Assessment Ordinance .................. 8 Product Eco-responsibility Ordinance ............................... 8 Motor Vehicle Idling (Fixed Penalty) Ordinance ................ 8 Environmental Projects ..................................................... 8 Cleaner Production Partnership Programme ..................... 8 Green Procurement .......................................................... 8 The Ecopark and Recovery of WEEE ............................... 8 Green Building .................................................................. 9 Green Transportation ........................................................ 9 Tax Reduction ................................................................... 9 Development of Green Technology ................................... 9 Hong Kong-Guangdong Cooperation .............................. 10 CEPA Provisions .............................................................. 11 Exhibition: Eco Expo Asia – Environmental Technologies International Trade Fair ............................. 12 Non-Governmental Organisations and Councils / Government related Organisations ................................. 12
2.6
3
Market Segmentation
3.1 3.1.1 3.1.2 3.1.3 3.1.4 3.2 3.2.1 3.2.2 3.2.3 3.2.4 3.3 3.3.1 3.3.2 3.3.3 3.3.4 3.3.5
Air Pollution Control ........................................................ 13 Business Opportunities in Air and Environment.............. 13 Air Quality in Hong Kong ................................................. 13 Air Problems and Solutions ............................................. 13 Pilot Programme – Electric Vehicles (EVs)...................... 13 Waste Water Treatment .................................................. 14 Business Opportunities in Waste Water Treatment ........ 14 Water Quality in Hong Kong ............................................ 14 Water Treatment Technology Employed in Hong Kong ... 14 Water Problems and Solutions in Hong Kong ................ 14 Solid Waste Treatment .................................................... 15 Business Opportunities in Solid Waste ............................ 15 Solid Waste in Hong Kong .............................................. 15 Waste Problems and Solutions in Hong Kong ................. 16 Energy from Waste ......................................................... 17 Success Story in Hong Kong ........................................... 17
13
3.4 3.4.1 3.4.2 3.4.3 3.4.4
Energy Efficiency Improvement ....................................... 18 Opportunities Arising from Energy Efficiency ................... 18 Hong Kong Energy Efficiency Programmes .................... 19 Showcase Projects .......................................................... 19 Upcoming Tenders and Projects ...................................... 20
4
Market Projection
21
5
Doing Business in Hong Kong
22
5.1 5.1.1 5.1.2 5.1.3 5.1.4 5.1.5 5.1.6 5.1.7 5.1.8 5.2
Why Hong Kong? ............................................................ 22 Taxation........................................................................... 22 The Rule of Law .............................................................. 22 Clean Government .......................................................... 22 Availability of Talent ......................................................... 22 Immigration Policies ........................................................ 22 International Lifestyle ...................................................... 22 Well Developed Infrastructure ......................................... 22 Summary......................................................................... 22 Hong Kong and Switzerland ............................................ 23
6
References
24
7
Glossary
25
8
Appendix
26
1 Executive Summary A. Hong Kong, as one of the most developed internationalised cities in the region, has put significant efforts into developing the Cleantech sector to achieve sustainable growth. To target the fast growing local and regional Cleantech market, this report provides insights and action guidelines to Swiss companies who plan to expand their footprints in Hong Kong. 1) Hong Kong as a Base Hong Kong, part of China, near the Pearl River Delta (PRD), is a global business hub. With low taxes, robust intellectual property rights and skilled international talent, Hong Kong can provide Swiss companies with a supportive business environment to set up presence. It can not only serve as a gateway to China, but is also an excellent place for the foundation of a global enterprise. 2) Local/Regional Market Development The Cleantech market in Hong Kong reached approximately HKD 6.5 billion (CHF 770 million) in 2011 with 25% annual growth rate projected for the next 5 years. Together with Guangdong, the total estimated Cleantech market could reach HKD 90 billion (CHF 10.6 billion) in 2018. 3) Environmental Challenges Air Pollution: with local emission of pollutants and the regional smog from the rapidly growing PRD area, the Hong Kong air pollution index reached a record high of 5 times the normal level in March 2012 Waste Water: all fresh water is imported from mainland China and the tap water cannot reach the direct drinkable standard. Marine pollution from ships, local and PRD swage have a significant impact on the local environment Solid Waste: high solid waste per capita. The current 3 landfills will run out of space in 2018. However, the incineration plant project was rejected due to the negative environmental impact on the local community Energy Efficiency: 90% of electricity consumption is caused by lighting and air conditioners in buildings, while less than 10% of the existing buildings use green construction materials 4) Direct Opportunities The government is the main driving force in Cleantech while the private sector also participates proactively. We identified a numberof projects in the following sectors that are worth targeting for Swiss companies: 4
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B.
C.
D.
Air Pollution Control 1.Charging stations and energy storage for E-vehicles 2.Fuel and exhaust gas purification equipment 3.Air purification technology in workplace Waste Water Treatment 1.Water catchment and treatment 2.Treatment works for municipal and industrial waste water 3.Water purification systems Solid Waste Treatment 1.Disposal site/ waste incineration site planning, designing, engineering, monitoring and operation 2.Recovery of valuable materials 3.Engineering of recycling technology Energy Efficiency Improvement 1.Green building design and construction 2.Building power management consulting 3.Energy saving technology for lighting and air conditioners 4.Green construction materials
5) Entry Barriers Lack of connection and bargaining power as small and medium-sized enterprises (SMEs) Lack of local knowhow and resources to set up and operate the company in the start-up phase Original products, technologies and services might not be directly applicable to the Hong Kong and China market 6) Entry Strategy Participate in the Eco Expo Asia to probe potential Work with Swiss Business Hub and Hong Kong government, approach local councils, chambers and companies to educate and build up relationships Set up a private limited company in Hong Kong to target local market and cooperate with local players Partner with reliable local professional service providers for outsourcing operations e.g. book keeping Set up research and development (R&D) center in Hong Kong to localise technology Expand into the Chinese market (e.g. manufacture in Pearl River Delta, set up sales network in China) In conclusion, by using Hong Kong as their springboard to China, Swiss companies can access a significant market with their expertise.