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  • Jul 13, 2014
  • Updated: 2:18am
NewsHong Kong

Chongqing showing Hong Kong it's back in business after Bo scandal

Western mega city sending biggest trade delegation yet to HK in wake of scandal

PUBLISHED : Wednesday, 10 April, 2013, 12:00am
UPDATED : Wednesday, 10 April, 2013, 5:50am

Chongqing mayor Huang Qifan will lead a large business delegation to Hong Kong early next week to attract new investment as the mainland city seeks to rebound from the scandal-tainted era of its former party boss Bo Xilai.

People familiar with the matter said Huang would promote several sectors, including financial services, public housing, infrastructure and transport.

The delegation, including top bosses from the city's finance office and the department overseeing state-owned assets, will meet several Hong Kong tycoons and major institutional investors.

It will be the largest-ever delegation from Chongqing to promote investment opportunities in Hong Kong

"It will be the largest-ever delegation from Chongqing to promote investment opportunities in Hong Kong," said one of the sources. "It's time for Chongqing to go out and restore its image as a hub city in western China to attract overseas investment."

In recent years, Chongqing has been widely touted as an up-and-coming manufacturing centre - cheaper than the pricey coastal provinces but equally well known to the world.

Investment in the municipality's factories and infrastructure surged and exports doubled. But the murky downfall last year of Bo, in one of the biggest scandals ever for the Communist Party, quickly soured business sentiment.

Investors chose to steer clear of the city amid the ensuing political uncertainty.

Some in Chongqing are grateful for Bo's efforts to polish its image and boost the economy, but during his tenure the local government's spending far outstripped its revenue.

There has also been talk that massive lending by state banks to local-government-linked investment firms was collateralised with overvalued land. These debts are estimated at 40 to 100 per cent of Chongqing's gross domestic product.

Huang managed to remain as the city's No2 leader following Bo's downfall, partly because he openly supported Beijing's decision to turn the heat on Bo.

In Hong Kong, Huang is set to meet Charles Li Xiaojia, CEO of Hong Kong Exchanges and Clearing. A pact would be signed to jointly promote potential listings of Chongqing firms in Hong Kong, the sources said.

One of the major upcoming listings is the Bank of Chongqing, which has hired Goldman Sachs and Morgan Stanley to help it prepare for its initial public offering to raise about US$600 million.

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