AMWAY sales in Hong Kong will be affected as the company branches into China, because many active distributors will probably shift their focus there, says Eva Cheng, president of Amway Asia-Pacific. 'I think the growth in sales in Hong Kong will be flat for the next few years,' she said. While denying the Hong Kong market was saturated, Mrs Cheng said it experienced only slight growth last year, with sales worth $470 million. Any sales loss would be easily compensated by the giant China market, she said. Amway China had finished the first phase of its factory in Guangzhou and would offer products for sale from April 10. Mrs Cheng said the company initially would rely on the personal relationships of the distributors in Hong Kong and Taiwan to recruit mainland distributors. The plant in Guangzhou would provide five kinds of liquid homecare product for Guangdong and Fujian. 'We chose these two provinces because they are the closest to Hong Kong. I am confident in the China market because of the success in Chinese communities such as Hong Kong and Taiwan,' she said. Prices for the products in China would be set at least 17 per cent higher than those in Hong Kong because of the value-added tax (VAT), Mrs Cheng said. 'We have to do this [pass all the VAT onto the customers]. I think products in China will cost 10 to 15 yuan more than in Hong Kong,' she said. But Mrs Cheng was confident the price differences would not trigger a large flow of smuggling into China, because of the company's strict conduct code and the possible risk involved. However, she said there were no effective measures to curb fake Amway products except taking the cases to court.