March 15, 2012- Hong Kong

March 15, 2012
Breakfast early in the hotel and then board bus to transit to Hong Kong.
Entry to Hong Kong was very confusing. We exited the bus and were officially processed out of mainland China. Then we boarded the bus again for entry into Hong Kong. Waited in a very crowded line for about an hour, in order to get through Hong Kong customs. Many Chinese vacation to Hong Kong for just one day and are in a hurry. We got to see first hand the fact that Chinese do not hold any regard for lines or queues. We had a hard time keeping our group together in line as the Chinese would move into any gap available. This situation was pretty funny really. We managed to keep the group roughly together until we got to customs. Shew!

Back on a new bus with our new guide, Andy- ha! He said that a lot. Driving around Hong Kong reminded me a lot of New York. Luxury buildings, brands, cars, etc. by the water. Stopped for Dim Sum lunch with many Chinese tourists.

Dim Sum lunch in Hong Kong



Dim Sum lunch



Dim Sum lunch was very good. The difference between other meals we had was the dumplings- many trays of dumplings of all types. All were delicious. 

Stopped for a bit to see Hong Kong harbor. Weather was a bit cloudy, but still very impressive. Water was emerald green.

Lecture at Hong Kong University by Doug Vogel, professor of Information Systems.

He began with this slide, Chinese view of GDP, purchasing power parity. China's PPP is the red line, Europe is blue, Japan is violet and the US is green. This chart starts in the year 0 AD. Until around 1840, China dominated world trade, controlling over 25% of the world GDP. China's decline in the world economy began with the Industrial Revolution, to which they were very late to the party. The point is that the decline in the Chinese economy since the mid-1800's is just a blip in Chinese history. The Chinese see the world through their rich history which is 5,000 years old. They see their very recent rise in prosperity (during the past few decades) not as a new "emerging" economy, but as a return to the norm. Interesting perspective which we must recognize in order to understand their culture, I believe. The Chinese see the US as newcomers to the world stage.

Here are some notes from the lecture:

Doing business in China is relationship driven- Guanxi is the Chinese word for relationships between business people. The concept is that guanxi is a tit-for-tat relationship between two people and the idea is that of establishing relationships with people that could be beneficial down the line. This definitely happens in US buisness, but we don't really have a word for it. We might refer to someone as "connected" which means the same thing.

54 different cultures in China- as complex as Europe

Need a license to do business in each province in China

Environmental problems:

electricity produced mostly by coal, high sulfur coal

Hong Kong/ China relations- 2 systems

July 1997 transition

British had 100 year lease on HK mainland

One country now with 2 legal systems and seperate legislature
Question as to who had the right to live in Hong Kong after the transition- children born in HK have right to Hong Kong identity card. Pregnant women from Chinese mainland enter Hong Kong to have their children so they will have HK citizenship
Hong Kong has prospered after the handover even though it had been predicted that it would not
Hong Kong is dependent on mainland China for water
Taxes ar 15% maximum in HK
Hong Kong taxes companies and government owns the land- has torn down many buildings and rebuilt
Housing costs very high in HK
60% of HK is parks and is land protected
Taxis in HK run on natural gas
HK converting cars to low sulfur diesel
Recycling is a new idea in China and HK
Lots of jobs available for educated Americans in HK
Industries in HK:
-previously an industrial base, during the cultural revolution industry moved from China to HK
-manufacturing has now moved back across the border into China mainland
-HK is now the financial center for China
-shipping and transport was centered in HK, ports are now declining in HK, HK port is very shallow- 36 ft.
-HK airport- largest freight airport in the world

Labor shortage on the mainland
FoxConn has 900,000 employees!
One child policy is adding to labor shortage problems
Labor is becoming expensive
Manufacturers are moving to Vietnam because of rising labor costs
Chinese realize they are living on success of exporting which will not last forever. They realize they must learn to innovate and create to compete long-term with rising labor costs

Very interesting lecture with Dr. Vogel

Checked into the YMCA- Salisbury right in the heart of downtown Hong Kong. Very nice hotel. I was exhausted and headed straight for bed. Lex went to Indian restaurant with Nirav and Shridar.

YMCA Salisbury lobby in Hong Kong