Despite growing global competition, Hong Kong's leaders of industry are confident the SAR's future as a trade hub will continue as long as local businesses fully embrace cutting edge technology, particularly electronic commerce. At a recent seminar exploring the topic, Federation of Hong Kong Industries chairman Henry Tang asked his audience: 'Why is electronic commerce becoming so important in Hong Kong?' Mr Tang said his experience as a textile manufacturer and former legislator had given him a good insight into the paperwork and logistical problems small companies faced when cutting international trade deals. The answer, he said, was electronic commerce or electronic data interchange (EDI). EDI had provided users across the world with major efficiency benefits like reducing overhead costs by improving company cash flow through just-in-time ordering, improved shipment tracking and customs clearance times. However, Mr Tang warned that,with the world accelerating into the information age, Hong Kong companies must continue preparing themselves for the increasingly competitive world market. 'This is nothing to do with the change of sovereignty but a simple recognition of the fact that the world is opening up and becoming a much more competitive place,' he said. America, Canada and a number of EU countries were now using EDI and beginning to insist other nations complied. In addition, he warned that China, Taiwan, Singapore, Korea, Malaysia and Thailand represented a regional threat as they also had embraced new technologies. 'Electronic commerce is one important way in which Hong Kong can add value, especially in view of our finance and communications infrastructure which is unmatched in the region,' he said. 'If Hong Kong companies are not prepared to go with the flow and implement EDI, many of our biggest customers will simply start going elsewhere.' Mr Tang said that despite the trend for SAR companies to manufacture a large portion of their goods in southern China, the majority of products still travelled through Hong Kong's port. 'If an overseas customer can source all the goods he needs, pay for them and arrange their production, shipment, insurance and clearance through customs, all by means of an electronic message to a Hong Kong supplier, it does not greatly matter where the goods are manufactured,' he said.