Hong Kong technology companies are increasingly turning to the Middle East to expand their operations as that region has tremendous demand for technology solutions, Under Secretary for Financial Services and the Treasury Joseph Chan Ho-lim said on Monday.
Speaking in a radio program, he recalled having led a delegation to the 2015 Dubai Fin Tech Summit to promote the development of green financial technology in Hong Kong and the United Arab Emirates.
“Representatives of some Hong Kong-based technology companies in my delegation contacted firms in the UAE to promote their businesses, while some representatives of Chinese mainland enterprises also used the opportunity to get to get in touch with their counterparts there,” Chan said.
Hong Kong and some Middle Eastern countries have signed memoranda of understanding to support each other’s financial technology activities.
“I would describe Middle Eastern companies as pragmatic with clear strategies. After learning they lack relevant technical network support, they are willing to obtain solutions from Hong Kong technology companies,” he said.
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Hong Kong-based on-demand delivery platform Lalamove — a privately-run startup valued at over $1 billion — said on Monday the United Arab Emirates will become its 14th market worldwide. The unicorn company is launching full logistics services in Dubai and drop-off services in Sharjah and Abu Dhabi.
The UAE is Lalamove’s second market in the Europe, Middle East and Africa region, after Turkey.
With the rise of e-commerce, Lalamove said it will strive to serve the logistics solutions needs of small and medium-sized companies in the UAE, which contribute 40 percent of the Gulf state’s gross domestic product.
Since the end of April, the startup has recruited around 2,000 driver partners in the UAE; it said it expects to reach break-even point in the UAE market within around two to three years.
“We are evaluating opportunities in other Middle Eastern markets when we are looking at markets that will have synergies with Dubai,” Lalamove Chief Operating Officer Paul Loo told China Daily.
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The startup has invested in technology infrastructure by introducing universal features like real-time global positioning system tracking, multi-location deliveries, and application programming interface integration, to provide faster, affordable and reliable on-demand logistics solutions.
“Our core delivery-matching features remain consistent across markets, while we have taken the time to understand local preferences, adapting our app for local languages and currencies and tailoring it to fit cultural expectations, regulations and operational needs,” Loo said.
Chan said Middle Eastern firms are interested in expanding in the special administrative region.
“Hong Kong has the advantages of free capital flow and a low tax system. The city also apples the common law system which is more familiar to the Middle East, and can help Middle Eastern companies to tap the Chinese mainland market. We believe this will strengthen collaboration between Hong Kong and Middle Eastern enterprises,” he said.
If Middle Eastern companies intends to expand into Asia, then the SAR will be a good place for them for to build up their markets, he said.
