Hong Kong

QUESTION 1

Hong Kong is Asia’s financial, business and trading community. It is one of the world’s leading international financial centres, characterised by low taxation and free trade. The Hong Kong Government has traditionally played a mostly passive role in the economy, with little by way of industrial policy and almost no import or export controls. Market forces and the private sector were allowed to determine practical development. Hong Kong is the world's eleventh largest trading entity, with the total value of imports and exports exceeding its gross domestic product. It is the world's largest re-export centre. Hong Kong's transportation network is highly developed. Over 90% of daily travels (11 million) are on public transport, the highest such percentage in the world. with an average annual growth rate of 0.8% over the previous 5 years.

Hong Kong has population of around 7 million, meaning the size of market is comparatively small compare to other country like Japan and China or Indonesia. Since the market size is small, the selected entry mode is more suitable to the Hong Kong market. To build new production plant in which uses local resources might not be good idea due to the high capital cost and the ROI might require longer time than it should.

I would choose export based as mode of entering market in Hong Kong to expand Proton market.

car industry in HK, transportation culture/facilities,

Ownership attributes  (O)

Competitive advantage of firm

Core competencies

Control of resources

Location attributes  (L)

Factor endowments

Government regulations

Internalisation  (I)

FDI of competitive advantage in foreign market

QUESTION 2

Communication is the most important element to success for doing business and developing long-term relationships. This becomes more important when operating internationally due to language barrier. Hong Kong is overwhelmingly populated by Chinese and its population are primarily drawn upon the five major groups of Southern China: The Cantonese, The Fukkien, Hainan, The Chui Chow and The Hakka. Cantonese and English are the two languages of use on the island. Although English is commonly used in Hong Kong business culture, be respectful of Chinese business partners by practicing or try to learn Cantonese may help to build personal network and strong relationship with business partners, suppliers and clients. This can be done by practicing a bit of small talk or a few polite phrases to show an effort to learn the local language. This helps to integrate with the local community and demonstrates interest in the new country. Apart from that, do research on the style of communication or body language of Hong Kongers and understand it. For instance, Hong Kong business people use direct yet non-verbal cues, such as silence, as a form of communication. Silence often indicates disagreement or careful consideration. It’s recommended to remain quiet and respect the pause.