UAE means business at Hong Kong post

Tom Spender

• Last Updated: November 24. 2009 6:50PM UAE / November 24. 2009 2:50PM GMT

After five years in Hong Kong, Saeed al Junaibi is intimately acquainted with the cityscape spread out beneath the panoramic sweep of his wide 22nd-storey office window.

From the Mass Mutual Tower in the Wan Chai district of Hong Kong Island, the UAE’s Consul General has commanding views over the harbour, where land is being reclaimed from the sea for new offices and an expressway. He can also see across to the Kowloon Peninsula, where ambitious skyscrapers continue to rise amid the already dense urban environment despite the global financial crisis.

The activity outside his window is mirrored by the bustle inside Mr al Junaibi’s office, a crucial node in the traffic shuttling between two of the world’s biggest trading hubs.

“Wherever you go there’s always work to be done – a lot of people want to deal with the UAE. But Asia and China is really where the business is,” says the career diplomat, who prior to arriving in Hong Kong served in Brazil and at the UN in New York.

The UAE and Hong Kong have two crucial elements in common, he says: neither lets politics get in the way of business and both exploit their positions as gateways to larger regions where doing business can be fraught with red tape.

“On a recent visit to Dubai, Hong Kong’s chief executive Donald Tsang said, ‘I can smell Hong Kong in Dubai’.

I like that quote because he’s talking about the spirit of achievement in business,” says Mr al Junaibi. “That’s what Hong Kong and Dubai are driving forward. They share a desire to do things based not on politics but on business.

“For our part, we always say that being an Arab Muslim doesn’t stop you from being good at anything you want to be good at. And we both are not only doing the business but also eliminating obstacles and red tape, nonsense that doesn’t help anything.”

As a result, huge volumes of goods are shipped between Hong Kong and the UAE, Hong Kong’s biggest trading partner in the Middle East, Hong Kong Trade Development Council statistics show. Overall, the UAE is Hong Kong’s 22nd-biggest trading partner.

Last year, UAE trade totalled about US$4.4 billion (Dh16.16bn), up 7.2 per cent on the previous year, making the Emirates the gateway to the wide Arab world for the vast majority of goods Hong Kong exports to the Middle East.

Between January and September this year, about $1.8bn of goods have been exported from Hong Kong to the UAE, including telecommunications equipment, gems, jewellery, watches, clocks and computers, most of which is manufactured in mainland China, where the next-door province of Guangdong accounts for about a quarter of China’s entire trade value.

About $1.2bn of goods have travelled in the opposite direction, including pearls and other gems, non-electric engines, motors and parts and jewellery.

Such volumes naturally mean big opportunities for logistics and shipping companies and here the UAE has become a big player through the gargantuan cargo operations of

DP World, which has its Asia-Pacific headquarters in Hong Kong and says the cargo logistics centre it operates there is the world’s biggest. DP World Hong Kong also claims to be the most productive terminal operator in Hong Kong, with each of its shore cranes hoisting about 40 containers each hour and some 3,200 lorries delivering or picking up containers daily.

DP World’s Asia Pacific and Indian subcontinent operations says it handled 2.7 million containers in the first half of this year, down 10 per cent from the previous year.

But Emirati companies’ activities in Hong Kong are not limited to cargo. The National Bank of Abu Dhabi (NBAD) has just bought a complete floor in a prestigious new office building.

“NBAD is coming very strongly. They want a share of the Hong Kong business banking market,” says Mr al Junaibi.

NBAD itself says it hopes to kick off its operations before the end of the year and in October appointed Ernest Law Shee-Wing as a regional manager in Hong Kong after receiving approval in May from the Hong Kong Monetary Authority to open a branch.

“This is just the beginning of our strategic initiative for the Far East where we intend future expansion with Hong Kong being made the Regional Head Quarters” says Qamber Ali al Mulla, the senior general manager of NBAD’s International Banking Division.

Mr al Mulla also says he hopes NBAD will be able to serve as a gateway for Arabs who want to invest in China and other Asian countries as well as assisting Chinese and business houses interested in doing business or investment in the UAE and other GCC countries.

Mashreq Bank as well as Dubai’s Department of Tourism and Commerce Marketing and Dubai Holding’s Dubai Investment Group also have representative offices in Hong Kong, Mr al Junaibi adds.

While the UAE and Hong Kong have much in common, the Emirates relatively recent economic development means there is much it can learn from Hong Kong, with it strict regulatory environment providing a good example.

“Hong Kong has reached a level of perfection in some things where we are just starting out,” says Mr al Junaibi.

“In property development, for example, Hong Kong has gone through a lot of problems and we need to learn from their experience and get rid of some of the rubbish in our own property business. We can learn from the rules and regulatory processes in Hong Kong and I’m very pleased that this seems to be working.”

Hong Kong’s unique status means it is undergoing a property boom as property prices in other markets such as Dubai decline, with rich mainland Chinese piling into luxury apartments as a way of putting money offshore yet keeping it close to home. Their investment has pushed prices for the most expensive property up to almost $10,000 per square metre.

“Here, there are established courts especially to resolve property issues and they are very good at actually applying the rules,” says Mr al Junaibi. “Sometimes having laws alone is not enough. Because of the mass of languages we have in the UAE it is not always easy for us to implement the laws we have.”

Hong Kong’s population mix, with a 90 per cent Cantonese majority and a highly qualified expatriate community, is also far removed from the situation in the UAE, where Emiratis remain a minority. But Hongkongers are also preoccupied with their identity, Mr al Junaibi says, amid the process of reunification with China.

Full unification will take place in 2047 and some Cantonese are worried that closer ties with the mainland will erode their language and laissez-faire business culture.

But whatever happens to Hong Kong in the long term, Mr al Junaibi hopes the growing trade between China and the Middle East will lead to the creation of a new kind of business communication, one that is not so dominated by western norms.

“At the moment, we speak to one another using western language and a western business model,” he says. “But what I would really like to see is us develop our own kind of dialogue that comes directly out of our own cultures and backgrounds.”

business@thenational.ae