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Business Insight

Luring Hong Kong's Brightest

Julian Luk

As pro-democracy groups in Hong Kong demand greater political freedom from China, it is a different story on the economic front. The territory is becoming increasingly interdependent with the mainland.

Leaders in Hong Kong say the city can play a major role in China's "One Belt, One Road" initiative. The project calls for two silk roads - one land-based and one maritime - to connect countries throughout Eurasia. Some of the gateways are in Guangdong, the southern Chinese province neighboring Hong Kong.

Officials have set up three pilot free-trade zones in the province and are now working to lure young Hong Kong entrepreneurs to start new businesses in Shenzhen. What was just a modest fishing village barely three decades ago is now becoming a major manufacturing hub under the national development plan. Shenzhen overtook Hong Kong this year as the most competitive Chinese city.

Drone-maker DJI symbolizes the city's momentum. Established nine years ago, the company now dominates the global market, with an estimated 70 percent share. The firm's founder Frank Wang graduated from a university in Hong Kong but chose Shenzhen to set up his business.

Wang saw that he had access here to a wide variety of electronic components at low cost. He also knew that engineers come to the city from all over China. "When he started actually looking at expanding the company and to create actual physical products, Shenzhen had some unique advantages," DJI spokesman Michael Perry explains.

Leaders in Beijing are hoping to attract other business talents from Hong Kong, and they have commissioned liaison manager Hung Witman to carry out the mission.

"This is new thinking," says Witman. "This is very different from the old Chinese government we know. I think entrepreneurs definitely need to cross the border," says Witman, managing director of Qianhai International Liaison Services.

Officials are backing Witman with a variety of incentives and preferential treatment for businesspeople from the territory.

A pilot free-trade zone, which officials have dubbed a "Dream Youth Hub", launched in April. Entrepreneurs who set up an office enjoy the first year rent-free, in addition to tax breaks. They are also introduced to investors from the mainland.

"I want to become a bridge between the huge Chinese market and Hong Kong. I want to do business in China," says one participant. "Our firm's aim is to build a financial service that can connect mainland China with Hong Kong," says another.

About 1400 ventures showed an interest in the zone. The ones with the best prospects were chosen - and last month saw the first group presented with keys to their new offices. Beauty products entrepreneur Elvis Li, 30, was one of the lucky ones to be selected.

Amid skyrocketing real estate prices in Hong Kong, he and other likeminded business owners are hoping to find success by moving their operations to a hub closer to their target market of 1.3 billion people.

"The environment is excellent," says Li, who has named his firm Beauty Insights. "I'll be connected with business people on the mainland. That will give me great opportunities in the future."

People in Hong Kong are seeking a new dynamism to stimulate the territory's matured economy - and those on the mainland are welcoming the highly developed business skills that Hong Kong entrepreneurs can bring.

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