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Business

 December 08, 2000
American Chamber of Commerce Hong Kong 2000 Business Outlook Survey

 In the aftermath of the Asian financial crisis, optimism and confidence in Hong Kong's economy and business environment is growing, according to the American Chamber of Commerce's 2000 Business Outlook Survey released today.

Commenting on the survey, AmCham Chairman Richard Kahler said: "Having witnessed a strong rebound in the SAR's economy for the past three quarters of this year, coupled with the prospect of enhanced business opportunities with China's imminent entry to the World Trade Organization (WTO), the American business community is bullish on Hong Kong's medium-term outlook."

Findings show that 95% of respondents to this year's survey foresee a "good" or "satisfactory" outlook for the year 2001, as compared to 84% forecast for 2000, with the percentage of "good" ratings rising significantly this year (41% vs 25% in 1999). Moreover, the survey results indicate this positive outlook will be sustained through 2005.

More good news for the city is the survey's indication that Hong Kong will remain the region's commercial hub and preferred location of regional headquarters for AmCham members, with the trend to increase the size of regional offices returning to pre-Asian crisis levels. "The SAR's geographical location, low taxes, free port status, communications network, and superior infrastructure make Hong Kong a very attractive location for regional business operations," Mr Kahler noted.

"Another encouraging sign is that more AmCham companies are anticipating better performances over the next three years and planning to expand their operations both in Hong Kong and China, a fact that recognizes China's economic dynamics and Hong Kong's key role as an access point," Mr Kahler said.

Within the strong, positive results remain the business community's continuing expectations for improvement: respondents said that the high cost of doing business - particularly high housing costs and staff remuneration, inadequate level of English language proficiency in the workforce, and deteriorating environment would diminish Hong Kong's strength and create a vulnerability for Hong Kong as it strives for real regional leadership.

"As we ride out the recession, the whole community must make a concerted effort to address these impediments to the SAR's competitiveness," Mr Kahler said. "Reducing the cost of doing business, upgrading our workforce capabilities, and improving our telecommunications infrastructure and environment are key ingredients for attracting and retaining foreign investment, as well as facilitating the SAR's transition to a knowledge-based economy and IT hub," Mr Kahler concluded.

AmCham's 2000 Business Outlook Survey, conducted by ACNielsen, was mailed to 985 corporate representatives and a total of 385 responses were received between October 16 - 27, representing a 39% response rate.