Businessmen from Hong Kong industry and commerce circles expressed their welcome to the signing of the second phase of the Chinese mainland/Hong Kong Closer Economic Partnership Arrangement (CEPA II) in Beijing Friday.

They believed that the CEPA II is expected to play the role as a new engine for driving Hong Kong's economic growth and will benefit more Hong Kong enterprises.

Under the agreement, the Chinese mainland has agreed to apply zero tariff to another 713 kinds of products from January, 2005.

A total of 374 kinds of product have already enjoying zero tariff since Jan. 1 this year.

Under the new agreement, the Chinese mainland has agreed to grant preferential treatment in eight new services including airport services, information and technology services, patent agency services and other services while broadening the liberalization for 11 of the 18 service sectors enjoying preferential treatment under CEPA.

Andrew Leung, president of Federation of Hong Kong Industries, said Friday that the adding of new zero tariff products and the opening wider of the Chinese mainland service sectors eight new service areas are the expectations of Hong Kong industry and business sectors.

He believed that encouraged by the new agreement, more enterprises would likely to establish production lines in Hong Kong, urging Hong Kong businessmen to grasp the rare opportunity.

Jose Yun Sun-say, head of Chinese Manufacturers' Association ofHong Kong, said the CEPA II has included most of Hong Kong made products and the agreement is a piece of good news for businessmen.

He said, a number of Hong Kong ventures are expected to expand their production and some other international brand companies may move their production lines to Hong Kong, which could help to raise the employment rate in Hong Kong for the long term.

Victor Fung, chairman of Hong Kong Airport Authority, welcomed the decisions that the airport services sector has been included in the CEPA II.

He said the liberalization will provide added impetus to Hong Kong's aviation industry by opening up new and unprecedented opportunities for Hong Kong services in the Chinese mainland.

Fung said the initiative will allow airport services suppliers to share and participate in the modernization of airport management in the Chinese mainland.

The Hong Kong General Chamber of Commerce (HKGCC) also expressed its welcome of the new agreement.

Anthony Nightingale said, among the new zero tariff product codes, 184 are for products not currently produced in Hong Kong. This means there may be some potential for new improvements, whichis very encouraging.

Eden Woon, HKGCC chief executive, said in addition to further economic integration between Hong Kong and the Chinese mainland, the CEPA's main advantage lies in establishing a WTO recognized framework under which the central government can use Hong Kong as an experimental base for further opening.

Hong Kong businessmen believed that CEPA is a "living agreement, which can be strengthened through continuos contents updates by the central government and the Hong Kong Special Administrative Region (HKSAR) government.

They said undoubtedly, the implementation of CEPA has driven Hong Kong's economic recovery and helped rebuild the public's confidence in HK's future. The new measures will further stimulateHong Kong's economy and more Hong Kong companies are expected to benefit from the CEPA.

Source: Xinhua