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SCMP Reporter

XINHUA (the New China News Agency) last week set up its first overseas public relations arm in Hong Kong, Fortune China Development.

  The company will provide services including marketing promotion, business information, advertising and media publicity.

  It will identify customers who can help open up China's market, especially brand-name retailers, and industrial and property investors.

  With the backup of the Chinese state news agency, which runs more than 40 newspapers and magazines in China, Fortune China is in a position to tap into businesses in Hong Kong although it is still only of modest size.

  ''We know we are small and the market in Hong Kong is competitive. We know it is very difficult to compete with well-established public relation agencies such as Burson Marstella and Ogilvy and Mather,'' said managing director Ma Yunsheng.

  ''But there are some things we can do the others cannot. We are in a good position to arrange meetings and press conferences inside China. We have many co-operation opportunities with those well-established agencies,'' he said.

  Working from a 1,500-square-foot office in Wan Chai's Tai Yau Building, the company has a staff of eight and was established at a cost of only $1 million.

  ''We will expand our office, but we are still in a preliminary stage so we should start the business on a small scale. Our running costs are minimal so the pressure on us is small,'' said Mr Ma, who was the general manager of China's first public relations company, China Global Public Relations Company, a Xinhua subsidiary in Beijing.

  Fortune China is Xinhua's second subsidiary in Hong Kong. The first was New China News Limited, set up in 1979, which is responsible for handling subscriptions for all the agency's publications in Asia.

  The news agency was permitted to run commercial operations as its core business in 1980. In July, the government gave it the green light to run non-core businesses.

  ''Our profit-making division can help to fund the whole operation. We need more income to run the news agency,'' Mr Ma said.

  Because it was now opening the door to foreigners, China should put more effort into developing the public relations industry, he said.

  ''Many mainland investors who want to develop overseas markets, or foreign investors who want to enter the mainland market, need a middleman like us. We see it as a business opportunity. That's why we should spread our wings overseas,'' he said.

  Fortune China will also import and export communication and printing apparatus, cameras, electrical appliance and other goods.

  ''We only trade products which are related to Xinhua's core business,'' he said.

  The news agency plans to open a third subsidiary in Hong Kong later this year. New Garland (Hong Kong) will be a property developer and real estate agent.

  ''At the moment, the property market is sluggish so New Garland will not have a lot of business right now. But there are many good bargains in China and the market is still there.''   Mr Ma was one of the first public relations professionals in China. He joined China Global in 1985 and headed the office for six years.

  In 1990, he became the general manager of Hong Kong's New China News Limited and was recently appointed to head Fortune China.

  During his six years at China Global he established close links with Burson Marstella and other public relations agencies. The United States public relations agency has had a seven-year co-operation pact with China Global.

  At last week's opening ceremony, the new enterprise was welcomed by Solomon Brothers, Coca Cola, Philip Morris and the Hong Kong Trade Development Council.

  ''Although we don't have too much business right now, I know that I can do it. We are starting the business and it will need time to build it up,'' he said.

  Fortune China has business arrangements with Solomon Brothers and Philip Morris.

  Last month, Fortune China secured its first job arranging a five-day visit for Solomon Brothers to Beijing and Shanghai.

  Solomon Brothers chairman Deryck Manugh met Chinese leaders Jiang Zemin, Li Tieying and senior executives of the People's Bank of China, Bank of China and CITIC Industrial.

   ''I can't tell you how much we charge our customers but I can assure you the price is cheaper [than other public relations agencies in Hong Kong] for activities in China.''   ''Our business is not only for Xinhua. China needs more sophisticated public relations. I think we can play an important role in achieving that,'' he said.

Fact file History: A subsidiary of Xinhua (the New China News Agency), China's state news agency, the enterprise was set up with initial capital of $1 million. It has eight staff and operates from a 1,500 sq ft office in Wan Chai.

Business: The first overseas public relations arm of Xinhua, it provides services including public relations, advertising and marketing information. It also trades in communications and printing apparatus, cameras, electrical appliances and related equipment. Major clients: Solomon Brothers, Philip Morris and the Hong Kong Trade Development Council. Contact: Ma Yunsheng, managing director.

 Address: Room A, 24th floor, Tai Yau Building, 181 Johnston Road, Wan Chai Tel: 838 1162; fax: 834 5109 



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