The annual Beijing Doorknock featured an agenda packed with meetings to discuss topics ranging from the 13th Five Year Plan to the Belt and Road Initiative to RMB internalization to state-owned enterprise reform. Hong Kong remains, as always, a crucial liaison for international commerce in and out of the mainland
By Blessing Waung
This year’s AmCham Hong Kong visit to Beijing came at a critical time, following a tumultuous summer in the Chinese stock market, just after President Xi Jinping’s state visit to the United States and the November APEC Summit . With numerous topics at hand, AmCham brought a diverse delegation to the Chinese capital ready to face the topics at hand.
Led by AmCham Vice Chairman Walter Dias, Past Chairman James Sun, and President Richard Vuylsteke, the delegation included key business leaders from various sectors, including logistics, financial services, information technology and more.
“The Beijing Doorknock is an excellent opportunity to get a cross-section of perspectives from a wide range of Beijing policymakers and private industry leaders,” said Anthony Root, senior advisor to Moelis & Company.
“One of my key takeaways from the meetings is that the Beijing leadership is willing, to a degree that it wasn’t previously, to identify and address its economic challenges. This awareness is critical to their ability to implement reforms and shift the economy away from excess capital spending and move it towards value added services and increased domestic consumption.”
Meeting with the People’s Bank of China is one of the annual highlights of the Beijing Doorknock, and this year was no exception. The discussion dove immediately into the PBOC’s planned economy nature and consensus mechanism, in which delegates inquired regarding the future liberalization and transparency of monetary policy.
Ms. Xing Yujing, Secretary General of Monetary Policy Committee & Director General of Monetary Policy Department II, People’s Bank of China
According to Xing Xujing, the Secretary General of Monetary Policy Committee of the PBOC, the future plans include two parts. The first is for the Shanghai Free Trade Zone to allow individuals to invest overseas via qualified domestic individual investor (QDII2) schemes, with raised investment ceilings for both individuals and institutions.
Additionally, with some of the progress from the pilot programs, there will be further two-way liberalization of financial markets and increased transparency in response to market demand. Foreign exchange is also a priority for China, and Xing pointed out the challenge that central banks of emerging markets face worldwide, which is that there must be a balance between economic growth, employment, as well as reform. The PBOC will continue to work with various ministries which each need their relevant support policies, particularly in regards to SOE Reform, real estate and local government debts.
Meeting with the state-owned Assets Supervision and Administration Commission (SASAC), AmCham delegates queried the latest update on state-owned enterprise (SOE) reform, to which point SASAC outlined the market-oriented goals ahead, for mixed ownership and internationalization of SOEs.
“We need to optimize the layouts of SOEs, and make operations more aligned with the national strategies and more conducive to our people’s welfare,” said Yin Yisheng, Deputy Director General of the Bureau of Enterprises Reform for SASAC. “Our aim is to let operators and the market have a more real understanding of the status of our SOEs, therefore they can make the right plans and targets.”
In collaboration with AmCham, SASAC suggested the following: establishing a communication platform to host seminars; establishing a cooperation platform; and establishing a financing platform. In the future, they hope to make SOEs stronger and bring “new dynamism” to encourage a better investment environment in China.
AmCham delegates with Tommy Yuen, Deputy Director, Beijing office of HKSAR (front center)
Hong Kong’s role
One of the frequent topics of the Beijing Doorknock was the “One Belt, One Road” initiative, which has since been updated to be named the “Belt and Road Initiative.” When meeting with Kang Wen, the Deputy Director General for Taiwan, Hong Kong, and Macau Affairs for the Ministry of Commerce, it was emphasized that there were main connectivity points to be emphasized: 1) governments; 2) regional infrastructure; 3) trade and investment flows; 4) financial cooperation and integration; and 5) people-to-people.
In terms of the role that Hong Kong can play, she noted the mature professional services market available, especially pertaining to legal, accounting, risk management, financial and consulting services.
By 2020, the Asian Infrastructure Investment Bank predicts the need for US$8 trillion in capital, so Hong Kong’s financial platform will play a crucial role. Currently, the Ministry of Commerce is working on projects together with the Hong Kong Trade and Development Council to promote professional services.
Delegates and officials at Development Research Center of the State Council
Wang Yiming, the Vice President of the Development Research Center of the State Council, summarized the 13th Five-Year Plan and what it detailed for Hong Kong. In it, he said, there are plans to support Hong Kong’s competitive edge, as well as to help the city develop new industries and to continue to cooperate with the Mainland.
Its role, he said, included providing global perspective and to continue serving as an international financial center and offshore RMB center.
New AmCham traditions
In what has become an AmCham HK tradition, delegates participated in a luncheon with a benchmark Chinese company, China National Cereals, Oils and Foodstuffs Corporation, known as COFCO, one of China’s state-owned food processing companies and the country’s largest food processing manufacturers.
Chairman of COFCO Frank Ning Gaoning outlined both the company’s domestic and global strategy, especially with regards to keeping track of the supply chain for fast-moving consumer goods such as milk. COFCO is implementing SASAC’s mixed ownership model, and investing in real estate, hotels, as well as shopping malls.
“Particularly for me, it is nice to know more about [COFCO], one of the biggest food players in China and get some important some insights about the overall food and beverage industry in China. I believe these learnings are worth sharing with our F&B industry members when there is a suitable occasion in the near future,” said Veronica Sze, Associate Director, Public Affairs & Policy, Wyeth Holding Company Limited Hong Kong.
Frank Ning Gaoning, Chairman of COFCO (standing)
Continuing another tradition, AmCham delegates participated in its second networking mixer and dinner with key leaders of AmCham China, including President Mark Duval, at the Capital M Restaurant overlooking Tiananmen Square. This evening, which coincidentally celebrated two AmCham China members’ birthdays, was the perfect opportunity to share insights about business in Hong Kong and Beijing, and to facilitate meaningful conversation and relationships for cross-border business connections.
AmCham continues to serve as a platform for MNCs and SMEs to liaise with the Mainland, and there will be numerous delegations planned in 2016, including the annual delegation to Beijing as well as sector-specific delegations to other key Chinese cities.
Beijing Doorknock 2015 Delegates
Managing Director, Charles Schwab HK
Managing Director, Greater China & Korea,
President, AmCham HK
Vice President-International Affairs, APAC,
Chairman, Asia Pacific, BNY Mellon
Partner, Paul, Weiss, Rifkind, Wharton &
Partner, Heidrick & Struggles Hong Kong Ltd
Vice President & Head of Regulatory,
Industry and Government Affairs, Asia Pacific,
State Street Bank & Trust Co.
Associate Director, Public Affairs & Policy,
Wyeth (Hong Kong) Holding Company Limited
President – Asia Pacific, AECOM
Vice President and General Manager, Asia
Datapipe Managed IT Services
Managing Director, Equities, ASIFMA
Executive Director, Global Government Relations,
Senior Advisor, Moelis & Company
China Financial Service Consulting Leader, PwC
Director, Government Affairs,
Rockwell Automation (China)
Global Co-Chair of Mergers & Acquisitions,
Ropes & Gray LLP
Corporate Development Director, China,
Walgreens Boots Alliance