[250811.EN.BIZ] Hong Kong Companies Shift Work From PDR To Western Guangdong To Cut Costs

MANY Hong Kong companies in labour-intensive industries in the Pearl River Delta have relocated some production activities to western Guangdong in the face of rising production costs and labour shortages, reports the Hong Kong Trade Development Council (HKTDC).
A recent HKTDC survey reveals that among the enterprises polled, 6.2 per cent indicated that they plan to set up new factories in the mainland within the next three years. Among them, 18 per cent would choose locations in Guangdong.

With increasingly convenient transport links and lower labour costs, western Guangdong has drawn the attention of Hong Kong companies which want to relocate production activities.

In recent years, Yangjiang has been actively developing itself into a destination for industrial relocation. At present, there are four provincial-level industrial relocation parks in Yangjiang. Maoming has also been very proactive in setting up industrial relocation parks and in promoting investment in the city. At present, there are three provincial-level industrial relocation parks in Maoming.

Hong Kong-invested export enterprises that have started relocating are mainly engaged in labour-intensive industries such as textiles and garments, printing, sporting goods and electrical appliances.

The production costs in both Yangjiang and Maoming are lower than that in the PRD partly because of more abundant manpower resources.

Western Guangdong is adjacent to the PRD and is the provincial gateway of Guangdong to the south western region with a well-developed transport network. When the western coastal railway is completed for operation in three years' time, it will only take two hours to travel from Shenzhen to Zhanjiang. As for sea transport, both Maoming Port and Yangjiang Port are category one national ports open to the outside world.

As transport links between western Guangdong and the PRD improve, western Guangdong will become a more convenient venue for Hong Kong companies to expand production lines and accelerate production expansion in Guangdong.

Source : HKSG, 25.08.11.