Collaboration,

Communication and Connections

Dialogue with Michael Yeung,

Chairman of the Hong Kong Chamber of Commerce in China, Tianjin

By Annie Ly

When it comes to representing businesses from a range of industry sectors and facilitating the processes required to successfully boost commerce and the economy in China, the role is no easy task. Certainly, as we begin the year 2016 with a host of opportunities and challenges ahead, how will companies - both domestic and foreign - fare in Tianjin? This month, we sought the views of Michael Yeun - Founding Chairman of the Hong Kong Chamber of Commerce in Tianjin - about his role in managing business relationships in the city and what it takes to be an effective chairman.

Having over 30 years experience in business in Tianjin, Michael Yeung can be considered part of the rich business tapestry of the city with a strong network of connections both in various industries and with local government. With a diverse career background ranging from working in marketing to real estate and property management, Yeung is also vice president of the Ning Fa Group. He shares with us his insights on his work with the Chambers and what the future might hold for Tianjin.

What are your views on the current business environment in Tianjin?

The Tianjin business environment is very special. We are able to make good comparisons with other major Chinese cities such as Shanghai and Beijing. The important role of Tianjin in the northern part of China cannot be underestimated, especially with the Free Trade Zone (FTZ) which is giving many foreign companies a lot of opportunities.

One thing the Hong Kong Chamber of Commerce in China, Tianjin is doing at the moment is helping to encourage businesses to think about their industries and see that Tianjin is a good place to base their businesses. In our Chambers, we also work well with Big Four companies such as Deloitte and PwC. They are very supportive of our work and collaboration with the Tianjin Government.

What are the specific benefits of being a member of the Hong Kong Chamber of Commerce – Tianjin?

Something that differentiates us from other Chambers of Commerce is that we have over 8,000 Hong Kong companies here which help us to be leaders in placing business investment in Tianjin.

Hong Kong Chamber of Commerce, Tianjin is a platform for all the members to come together and get to know each other. This is especially important for newcomer businesses in Tianjin. By being a member, there is a good chance you can organize a meeting with business and finance leaders in Hong Kong.

We are also a good channel to link businesses together with the Tianjin Government. Through the Chambers, we are also able to clearly communicate messages to government members. Businesses are able to effectively express the needs of their industry to the relevant foreign affairs bureaus and directly seek the right people to help answer their questions.

Every year we have a Vice-Mayor's meeting with the General Managers of many Hong Kong industries. The Vice-Mayor chairs one meeting with the top 20 companies in Tianjin which often comprises of major banks and real estate companies. In this meeting, the difficulties of these companies are discussed in a forum along with government departments in tax, public security, customs and so on. These question and answer sessions are then followed up directly between those involved to ensure everyone receives black and white resolutions to their issues. Such processes are rarely seen in China. This type of straight-forward, transparent, communicative approach between business and government shows great progress, and it works well to improve the business environment in Tianjin and China.

Most people are able to easily recognize the high positions of their industries and often we invite relevant figures to give speeches to our members. This really helps to give our members a good understanding of the upcoming trends across many different business industries and give them a strong overview of the business environment to help them improve business overall.

You became the Founding Chairman of the Hong Kong Chamber of Commerce – Tianjin in 2008. What is the key to being an effective chairman and what is the most challenging task in your role?

As chairman, the most important thing is to be able to organize your team. The executive board is comprised of people from many different industries, from banks and the financial industries to insurance, so organizing them to the benefit of all the members can be challenging. However, they all have good experience of operating in Hong Kong and they are able to share their knowledge with other members. Therefore, as chairman, it is important to know how to facilitate this kind of knowledge exchange to improve the quality of business.

To ensure this is organised effectively, you must make sure you are recognized as the chairman because you are the one who will need to face them when they have problems, and be able to deliver good advice. As I have been in Tianjin for over 30 years, I know the people and Tianjin's environment very well. I am able to use my long-term experience and the relationships I have built over this time with business networks for the advancement of Chamber members and overall, to be an effective chairman.

In your opinion, what will be the critical factor for transforming Tianjin into one of the leading economic centers in Northern China?

As Tianjin, as a city, develops, our membership base also develops and grows. There is a feeling amongst companies from a range of industries that business in Tianjin will prevail. To ensure success, Tianjin needs foreign investment and further government support to encourage businesses to seize the opportunities there are in Tianjin over the coming years.

Every year, we hold at least two Chambers' meetings to discuss how businesses can help each other. Some companies express their desire and need to invest in Northern China, whilst others need to invest in Southern China. Through the Chambers, we are able to provide good co-ordination and communication between local government and business organizations to understand individual business needs. If we continue in this way, we can help to transform Tianjin into a leading economic hub.

We think 2016 will be very important for China's business development. What are your recommendations for businesses to help them to remain stable and successful during this period?

Although China's GDP growth has slowed down in recent times, companies need to keep themselves stable and wait for good opportunities to develop again. They will also need to slow down and review government moves to see how they can benefit their enterprise.

For example, I work for the Ning Fa Group. As a real estate business, we must slow down and landlords are making rental rates lower. On the other hand, we are developing in other areas of Northern China and have seen a strong growth-rate. A specific example is the Ning Fa Group's involvement in the Chinese tourism industry in Hunan - Zhangjiajie, where business growth has seen a 40 percent increase compared with 2014. Overall, it is a good time to review the opportunities that will create long-term stability and success.

What is your opinion on the new Jing-Jin-Ji region? What do you think about the opportunities for businesses looking to operate in this new area?

Just as the Hong Kong Chamber of Commerce, Tianjin is doing, I see the Jing-Jin-Ji macro administration plans as highly positive because it is a plan based on helping each other. It seeks to make aspects such as administration more efficient. For example in customs, if you make the application in Tianjin, you can clear the goods in Beijing more efficiently without having to physically go there. The Jing-Jin-Ji plan recognises that certain locations are specialised in certain roles. Tianjin is a strong place for manufacturing, whereas Beijing is not, therefore businesses may decide to relocate their back office work to their advantage. It is a positive business opportunity for many foreign companies.

Do you work with other Chambers of Commerce in Tianjin to further boost business opportunities?

We often work with the Tianjin chapters of the American Chamber of Commerce in China (AmCham) and the European Union Chamber of Commerce in China (EU Cham). A few months ago, we held the joint Chambers event with AmCham at the Renaissance Hotel. That was a very successful and enjoyable evening. We are currently discussing with EU Cham how we can better connect our members and introduce businesses to each other.

What are the future challenges Tianjin will face to continue growing and improving economically? What suggestions do you have to overcome them?

There is some sense of provincial competition between Northern and Southern China, as well as international competition emerging from outside of China. Many companies dealing in manufacturing are looking to move out of China due to reduced labour costs and complex labour laws. When profits drop and salaries need to improve, there needs to be a balancing point to keep your business competitive with others.

Cost is the most important thing for many companies and this requires careful consideration of budgets and how to balance them. If staff are not shareholders, salaries require constant reassessment. One piece of advice I could suggest that would overcome the issue of cost and pay, as well as address the issue of creating a good team, is when profit is good in the company, perhaps share an extra bonus at the end of the year rather than always assessing salary at the end of the year.

Could you tell us more about the future plans of the Hong Kong Chamber of Commerce - Tianjin?

As chairman, my main goal is to develop and increase the membership of the Chambers. To do this, we plan to make more local connections with the government and industry players. The majority of our members are from banking, finance, real estate and manufacturing industries, and so we would like to grow this membership and continue to work in collaboration with the government to improve business. We hope to demonstrate the important work the Hong Kong Chambers of Commerce, Tianjin is really doing for the city.

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