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Monday, April 20, 2015, 08:53

HK and Spain can enjoy a fruitful relationship

By Juan Morales

It was exactly two centuries ago that the last “Manila Galleon” sailed west from Acapulco in the then Spanish territory of “Nueva España” — “New Spain” — with a cargo of silver used in Asia and in China. This trade route lasted 250 years, from 1565 to 1815, exchanging wares from China and greater Asia for silver mined in Spanish America.  Unlike the ancient Silk Road, silver was then the main commodity, so much this route could justly be called by the “Silver Way”.

Now largely forgotten, this trade played a huge role in the world economy of the day. Indeed, it could be argued that this commerce — spanning three continents and a standard currency known as “Mexican dollar” — ushered in the global economy of today. There is much we can still learn from this original exercise in “globalization”.

When looking to the future it is worth remembering that the active presence of Spanish businesses in Hong Kong goes back to the earliest years of the opening-up of China. The Spanish Chamber of Commerce in Hong Kong is about to celebrate its 25th anniversary. A few of the largest Spanish multinationals, global leaders, have established headquarters in the city — such as Inditex (Zara and other brands), banks BBVA and Santander, or telecom giant Telefónica — as have many small- and medium-enterprises. The Double Taxation Agreement between Spain and Hong Kong, which became effective from 2012, has made Hong Kong even more attractive. Consequently, Net-Craman has recently become the first Spanish law firm licensed by the Hong Kong Law Society.

Hong Kong consumers are well aware of the high quality and originality of Spanish brands for fashion, shoes, toys and furniture, among other things. Particularly significant, as they become better known, is the current interest in Spanish food and wines; associated with the allure of the Spanish lifestyle, more restaurants are opening under Spanish chefs. Even learning Spanish is enjoying a renaissance. Today, relations between Hong Kong and Spain, look extremely positive. Nevertheless, from the perspective of my two decades as a businessman in Hong Kong, I cannot help feeling that the current level of commercial and cultural relations remains well below their true potential.

One major obstacle is the lack of direct air connections between Spain and Hong Kong. Yet the current traffic of passengers and goods, let alone the commercial potential, are such that direct flights have never been more justified.

The other major problem is less tangible: Knowledge, or rather, the limited, fragmentary, and therefore still inadequate knowledge of one another. From one side, relations between the mainland and Hong Kong as defined by the “One Country, Two Systems” principle are little understood in Spain. More effort needs to be made in Spain to explain Hong Kong’s unique political framework and how it might affect the SAR’s relations with another country. Its renowned lack of corruption and efficiency, low taxation, rule of law, reputation as a financial center and logistics hub should be more aggressively promoted.

Spain’s image abroad is often characterized by stereotypes. The Spanish lifestyle or popular culture — or rather, a local version of it — cannot be confused with the country’s high culture and fine arts.  Spain’s cultural heritage can boast of being among the most impressive in the world. What is less well known is its well-preserved and remarkable natural environment, with a large area devoted to country parks. This aspect alone will resonate with many Hong Kong people as a huge percent of the SAR’s land is designated as country park. Its outstanding tourist infrastructure should make the country a more popular destination for Hong Kong people than it is at present.

The current renewed mutual interest should not be squandered. Both Hong Kong and Spain need to collaborate more closely to maximize each other’s strengths.

Among areas where Spain could make the most meaningful contributions are in arts and culture — including the expertise of its administrators, curators and conservators; and architecture and urbanism — as Spanish architects are much sought-after for their modern, forward-thinking and sustainable proposals; green technology and renewable energy. Establishing physical offices may not always be necessary. In fact some current relationships are virtual or in partnership. That is the way forward where further investment is minimal and the rewards unlimited.

The author is a management consultant and former chairman of the Spanish Chamber of Commerce in Hong Kong.

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