HK eyes online shift for HK$3 trillion in trade
Reuters, By Kathleen Kearny

November 18, 1999 - A large portion of Hong Kong's HK$3 trillion (US$385 billion) in annual trade could be negotiated, registered and settled over the Internet in coming months through a government-sponsored partnership with U.S.-based TradeCard Inc. The government's Tradelink Electronic Commerce Ltd on Thursday agreed a partnership with TradeCard to provide traders secure electronic trade documentary compliance and settlement.

"More than 75 percent of all import and export declarations are now processed electronically and all of them will be by next April," Tradelink Chief Executive Officer Justin Yue told a briefing. "Our next target is to help them (Hong Kong companies) do e-business with their overseas trading partners more easily and cost-effectively," he added.

Beginning in the first quarter of 2000, Hong Kong businesses would be able to sign up through Tradelink to become TradeCard members, then begin transactions with other TradeCard members around the globe, he added. TradeCard was currently undergoing pilot testing of its systems before an announcement on the system's readiness mid-December, he said.

BIG COST SAVINGS

Cavano said total world trade amounted to US$5.5 trillion dollars and an additional US$420 billion was spent on the financing and paperwork needed to process that trade. "TradeCard represents a payment alternative international trade - a solution easier to use than a letter of credit, more secure than open accounts and available for one flat fee per transaction," Cavano said.

TradeCard will charge traders USD $150 per transaction, far less than the cost of a letter of credit. "We guarantee the Hong Kong exporter will be paid," Cavano said. TradeLink is 44 percent owned by the government and the remainder by 11 private sector bodies. These include China Resources (Holdings) Ltd, Hongkong and Shanghai Banking Corp Ltd, Cable and Wireless HKT Ltd , Modern Terminals Ltd, Standard Chartered Bank and Swire Pacific Ltd.

Cost-savings derived from the greater use of the Internet should enable Hong Kong businesses to continue to operate profitably from the territory, and facilitate a continuation of Hong Kong's role as the entrepot for China, executives said.

The government recently formed an alliance with China International Electronic Commerce Centre of China to facilitate e-commerce between the territory and mainland suppliers and factories, Yue said.