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Building Products Sector in Hong Kong Presented byElanna TamCommercial SpecialistU.S. Commercial Service Hong Kong
Topics to cover • Why Hong Kong? • Overview of Construction and Building Products sector • Competition and Market entry strategy • Major upcoming projects in Hong Kong and Macau • Niche market for U.S. firms
Why Hong Kong? • Growing economy • Easy place to do business • Access to the China and regional markets • Helping you get your China Strategy right
Hong Kong developers’ Land reserve in China(in USD) * Not including China Overseas, China Resources and CITIC, which portfolios focus in investment in China.
Overview on Construction and Building Sector • Construction Industry: 3.2% of Hong Kong’s GDP • In 2004, the total gross value of construction work = USD12 billion • Public Sector Work: 30% (USD3.6 billion) • Private Sector Work: 30% (USD3.6 billion) • Other e.g. Renovation, E&M Fitting-Out: 40% (USD4.7 billion)
Overview on Construction and Building Sector • Imports from the world (2004): 2.056 billion • Imports from the States: $183 million (9%) • Local market: $905 million.
Overview on Construction and Building Sector • British Building Code, British Standard • Metric System • Environmentally-friendly Technology • Energy-efficient Products • Public Awareness • Government Incentives
Competition and Market entry strategy • Imports mainly, local production negligible (paint, cement, steel I-beam, steel bar) • Competition: China (middle-ranking ceramic tiles, cement, glass, reinforcing steel bar, wooden doors, furniture) • Germany (sanitary fittings, water taps, kitchen cabinets, lighting equipment) • Italy (tiles, sanitary fittings, lighting equipment) • Japan (ceramic wall tiles) • Spain (tiles, sanitary fittings) • United Kingdom (fire resistant materials e.g. instumescent strips, instumescent paints, ironmongery, metal lathing, angle lathing) • U.S. known for quality and advanced technology
Competition and Market Entry Strategy • No trade barrier • Hong Kong re-export 50% imports to China • 200,000 SME • Agent/distributor • Brand-build with specifiers, professional institutes
Major upcoming projects in Hong Kong (in USD million) • West Kowloon Cultural Hub 5,000 • Hong Kong-Macau-Zhuhai Bridge 2,200 • Ocean Park Revamp Plan 705 • Stadium (70,000-seat) for Kai Tak Airport site 647 • Cruise Terminal 87 • Expansion of HK International Airport at Chek Lap Kok (upgrade passenger terminal – USD200 Million airfield improvement USD388 million) 582 • Logistic Park (USD194 million govt infrastructure work) 400 • Hong Kong Government Headquarters 513 • TST civic center 10 • Tai O Village heritage restoration 9 • Aberdeen waterfront beautification work(4-5 contracts) 5 • Lantau Island other theme park ? • Golf at Lantau island and Saikung ? TOTAL 10,100
Major upcoming projects in Macau (in USD million) • Cotai Development (Macau) 12 billion • Wynn Resorts (Macau) 705 million • The Venetian (Macau) 1.8 billion • MGM Mirage – SJM (Macau) 800 million
Niche Market for U.S. firms • Tourism projects building materials and construction equipment • Green Building Products
Niche Market for U.S. firms • Materials from sustainable sources e.g. timber • Recycled content: wall, tiles, carpet, board, countertop • Improves IEQ or IAQ: PVC-free carpet, low VOC content paint/adhesives, air filtration system • Improve water efficiency: low flow/waterless toilet fixture, reuse grey water • Energy-saving lighting equipment and motors • Infra-red motion sensors • Heat recovery devices • Other environmentally-friendly building products
Thank you for your attention! Elanna TamCommercial Specialist U.S. Commercial ServiceAmerican Consulate General 33 Garden Road, Central Hong Kong (SAR) Phone: +852 / 2521-5950Fax: +852 / 2845-9800Email: Elanna.Tam@mail.doc.gov