Meeting with the Liaison Office of the Central People's Government (LOCPG) in Hong Kong, 18 March 2012

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1 8/F, CHINA HONG KONG CENTRE, CANTON ROAD, TSIM SHA TSUI, KOWLOON, HONG KONG. TEL: (852) FAX: (852) enquiry@haffa.com.hk WEBSITE: GREATER CHINA AFFAIRS SUB-COMMITTEE Chairman: WANGFOONG TRANSPORTATION LTD Ms. Teresa Szeto / Mr. Damiao Cheng Vice Chairman: CARGO FREIGHT SERVICES LTD Mr. Raymond Chan Members: AE EAGLE FREIGHT TRANSPORTATION (CHINA) LTD DIMERCO AIR FORWARDERS (HK) LTD RHENUS LOGISTICS ASIA-PACIFIC LTD SIMX PROJECT X & TRADE COOPERATION ASSOCIATED LTD TRANS GLOBAL LOGISTICS (HONG KONG) LTD U-FREIGHT LTD AE CARGO SERVICES LTD C.H. ROBINSON WORLDWIDE (HONG KONG) LTD DHL GLOBAL FORWARDING (HONG KONG) LTD Greater China Affairs Sub-Committee plays a very active role in liaison with the government bureau, trade organizations as well as industry counterparts in the Greater China. Last year, the sub-committee, representing HAFFA, met many officials, associations and industrial players from different provinces to network and exchange valuable business intelligence and experience on the logistics practices. Meeting with the Liaison Office of the Central People's Government (LOCPG) in Hong Kong, 18 March 2012 A meeting with Mr. Xu Sen, Deputy Director, Department of Economic Affairs of the Liaison Office of the Central People s Government in Hong Kong ( ) and his team was held on 18 March Apart from exchange of information between both parties, Mr. Xu introduced two large-scale projects relating to logistics industry LOCPG is going to carry out: 1. Online platform to facilitate commercial project matching ( ) LOCPG is developing an online platform to facilitate commercial project matching between Mainland and Hong Kong enterprises. Interested Members will receive further information regarding the platform from LOCPG in the first half of Research study for HK logistics industry development (to compile a report) A logistics expert group will be established with an objection to provide LOCPG with the up-todate information of Hong Kong logistics industry situation and specific segments (e.g. cold chain,

2 e-logistics, automobile, chemistry etc). Following the research, LOCPG will compile a report which will be shared with the Mainland and Hong Kong enterprises free of charge. HAFFA/HKSC Joint Business Delegation to Yantian, 16 November 2012 HAFFA in collaboration with the Hong Kong Shippers Council (HKSC ) organized a business delegation to Yantian on 16 November The delegation was business-oriented with objectives to provide opportunities for delegates to better understand the global cargo trend from the aspect of US shipper, keep abreast of the latest developments of logistics management for wine, seafood, medicine and other perishable commodity in the Mainland as well as explore the possibility of business upgrading and transformation. Led by Mr. Damiao Cheng, the 30-member delegation visited Yantian International Container Terminals ( ), a natural deepwater terminal and the leading gateway serving import and export container traffic generated by its immediate cargo hinterlands; Pingyan Railway ( ), the one and only private railway in the Mainland and Shenzhen Ruiyuan Gold Storage Warehouse ( ), a supply chain company with a combination of refrigerated warehousing and storage, cold chain distribution and transportation, frozen food processing and food preservation. They also gained the opportunity to meet with Mr. Leo Liu, Asia Logistic Director of Phocus Asia Ltd, a wholly owned subsidiary of RSI Home Products (America s Premier Manufacturer of Cabinetry) and senior management of local logistics company to obtain information of current patterns of production and consumption, trend outlook as well as their expectation of logistics services. The feedbacks received from delegates were positive and encouraging. Interested Members are welcome to suggest any Mainland destination for the HAFFA Delegation to China in Year and we appeal for your continuous support in joining the delegation. International Forum on China s Economy and Policy, 12 September 2012 The Central Policy Unit, jointly with the National Academy of Economic Strategy of the Chinese Academy of Social Sciences ( ) and Li & Fung Research Centre held an international forum entitled China s Economy and Policy on 12 September Distinguished speakers and participants in this one-day event examined current economic situation and policies in the Mainland on expanding domestic demand, reforming distribution sector, further opening up, enhancing

3 East Asian regional cooperation as well as adjusting economic structure, and discussed the challenges and opportunities presented to Mainland China in general and to Hong Kong in particular. Greater China Affairs Sub-committee Chairmen attended the forum on behalf of HAFFA and share the insight related to logistics industry gained from the forum. The Group Chairman of the Fung Group, Dr, Victor Fung, and the Director of the National Academy of Economic Strategy of the Chinese Academy of Social Sciences, Professor Gao Peiyong, addressed the keynote session. It was noted that two major directives in view of bottoming out are: 1. Domestic consumption expansion 2. Service industries (e.g. logistics) enhancement The Chinese domestic trade market, accounting for RMB 5 trillion, is a huge business potential. Given global slump slowed Chinese exports, priority will be given to import trade whereby logistics industry should transform to meet the new trend. It was revealed in the forum that ports of Qianhai ( ), Hengqin ( ) and Nansha ( ) are the key areas for logistics development in China. Nansha port, possessing sophisticated associated infrastructure, is considered as being the best port in China. Hengqin and Nansha ports will be transformed into free trade zones in 2015, in which privileges in different aspects (e.g. trade financing) will be stepped up. A downward adjustment to the VAT (Value Added Tax) is anticipated, while demand on other types of tax (e.g. Property Tax) will increase to seek for balance. Currently, VAT represents 43% of total tax revenue in China, which is abnormally high when compared with other economies. It was believed that the VAT downward adjustment will be favorable for importers. The forum offered an opportunity for participants to analyze from a macro perspective the challenges encountered in the Mainland s economic development and currency policy as well as the strategy to address them. It also explored the roles of and opportunities opened to Hong Kong. Meeting and Luncheon with MAFFA Delegation, 22 January 2013 A 7-member delegation led by Mr. Edward Lee, Chairman of MAFFA (Macau Air Freight Forwarding (Logistics) Association paid HAFFA a courtesy visit on 22 January In the meeting, HAFFA was provided with the latest update on the formation of a new logistics alliance in Macau and explore the possibility for closer collaboration. Both parties exchanged views and information on training development, regulations of China Customs and industry outlook of Hong Kong/Macau upon completion of Hong Kong- Zhuhai-Macau Bridge in particular.

4 Meeting with MAFFA Delegation, 22 January 2013 Taking this opportunity, Ms. Teresa Szeto and Mr. Damiao Cheng would like to convey their gratitude and appreciation to all the sub-committee members and the secretariat that have devoted much time and efforts to participate in the work of the Greater China Affairs. Key activities in at a glance: Date HAFFA Event Organizer(s) / Visitor(s) 15/08/2012 Ir. Dr. Paul Tsui (Chairman) Briefing on Qianhai Shenzhen- Hong Kong Modern Services Cooperation Zone ( (HKTDC) ) 16/08/2012 Ir. Dr. Paul Tsui (Chairman), Mr. Joseph Leung (Executive Committee Member) and Mr. Ronnie Leung Sub-committee) Exchange of industrial information for the 15-member Shenzhen Government delegation to better understand the latest development of Hong Kong freight forwarding and logistics industry 30-31/08/2012 Ir. Dr. Paul Tsui (Chairman) as guest speaker 12/09/2012 Ms. Teresa Szeto (Vice Chairman) and Mr. Damiao Cheng (Greater China Affairs Subcommittee Chairman) 16/11/2012 Mr. Damiao Cheng Sub-committee Chairman) as delegation leader 04/12/2012 Ir. Dr. Paul Tsui (Chairman) as guest speaker SmartHK Expo, Hangzhou International Forum on China s Economy and Policy HAFFA/HKSC Joint Business Delegation to Yantian Policy Research Office of Shenzhen ( (HKTDC) Central Policy Unit HAFFA and the Hong Kong Shippers Council (HKSC) Seminar on Challenges, Opportunities and Strategic Responses of Logistics SMEs under the National 12th Five- Year Plan Federation of Hong Kong Industries (FHKI)

5 Date HAFFA Event Organizer(s) / Visitor(s) 11/12/2012 Ir. Dr. Paul Tsui (Chairman) Research in Planning and Construction of Hong Kong- Hong Kong Productivity Council (HKPC) Nan Sha Innovative Industrial Park 22/01/2013 Executive Committee Meeting and Luncheon with MAFFA 28/02/2013 Mr. Ronnie Leung Sub-committee) 11/03/2013 Mr. Damiao Cheng Sub-committee Chairman) and Mr. Eddie Law (Executive Committee) 18/03/2013 Ir. Dr. Paul Tsui (Chairman) and Greater China Affairs Subcommittee MAFFA Guangdong International Freight Forwarders Association (GIFFA) Spring Gathering 2013, Guangzhou Meeting with Netax Logistics ( ) from Shanghai to give them an overview of the logistics industry in Hong Kong Exchange of information and provide LOCPG s officials with an overview of HAFFA and Logistics Industry in Hong Kong Guangdong International Freight Forwarders Association (GIFFA) (HKTDC) The Liaison Office of the Central People s Government (LOCPG) in Hong Kong 20/03/2013 Executive Committee Logistics Study Mission to Airport Authority Hong Qianhai, Shenzhen Cooperation Kong Zone 20/03/2013 Mr. Damiao Cheng Round-Table Discussion: Guizhou Provincial People s Government Sub-committee Chairman) 17/04/2013 Mr. Damiao Cheng Sub-committee Chairman) Exchange of information with a delegation from Dalian Government The Chartered Institute of Logistics and Transport in Hong Kong (CILTHK) Date: 17 April 2013 (END OF REPORT)