CEPA offers tremendous opportunities for overseas companies to enter the Mainland market by setting up in Hong Kong, partnering with local companies, or even acquiring a company in Hong Kong.

This was the message from Chief Secretary for Administration Donald Tsang addressing the Hong Kong-Guangdong Business Seminar in London today.

Mr Tsang said for many British and other international companies, whether large or small, the best way to enter the China market was to set up manufacturing operations in the Pearl River Delta while running management, finance and distribution out of Hong Kong.

"It is a business model that combines the low costs and efficiency of the PRD with Hong Kong's sophisticated business infrastructure which is familiar to the UK and European countries," he said.

A good partnership

Guangdong Governor Huang Huahua said the province enjoys a good partnership with the Europe and the UK. He said the EU is one of Guangdong's most important trading partners and investment sources, while the UK is its second largest trading partner among the EU countries, and its direct investment in the province tops the EU.

He said Guangdong welcomes more international companies and consortia in sectors such as electronic information, automobile, petrochemical, machinery manufacturing and modern servicing, to invest in the province so it can become one of the world's most important manufacturing bases.

British Deputy Prime Minister John Prescott and Chinese Ambassador to the UK Zha Peixin attended the seminar, along with over 1,000 business executives from British and European companies.