The “hongs” or Trade Houses of Hong Kong

Hong Kong, the pearl of Asia has been the center of barter and pay in Asia since the early twentieth century. In a short history of about 150 years, Hong Kong has give-up the ghost the source of growth for more nearby economies. In a reliable sense, it can be even said that it is a merchant city founded and managed by Traditional hongs or trade houses of Hong Kong were the pillar of the economy. Jardine Matheson and Hutchison were major(ip) hongs that guide the economy and the Hong Kong & Shanghi border were the financier of these hongs and has today grown to become unitary of the largest coin bank in the world.These firms were the critical factors of the growth for Hong Kongs economy. Their region however has changed overtime. They ar no longer the de facto leaders of Hong Kong as they were in the mid 1800s. Their role has diminished as Hong Kong grew to become more international, and the 1997 handover to the Peoples Republic of China has tho altered their position. S ome hongs that adapted well to the changing times prospered bit new(prenominal)s either The territory of Hong Kong is located at the mouth of the Pearl River, a little southwest of the Guangdong Province of the PRC.Hong Kong was ceded to the British after the Opium War in 1842. Many recall that the British hongs were behind lobbying the British government into struggle the Chinese Government and the settlement of the island. Kowloon was annexed in 1860, and the New territories were leased for 99 years in 1898. In 1984, the British and the PRC government hold that Hong Kong as a whole would return to Chinese soverienty in 1997. However, a agreement of one country ii systems were as well as agreed upon where Hong Kong would cover its status as a free interface, with its laws remaining unchanged for 50 years.Its main mphasis is to preserve Hong Kongs laws and stinting freedom, thus to enhance the position of Hong Kong as a economic center. The Large British have hongs were o riginally trade and fightehouse companies realized by the British in the early days of Hong Kong colonialism, they have since grown in to major commerical conglomerates. They hold interest in cargo manipulation, manufacturing, real estate, and even retailing. They are the engine of the Hong Kong economy.Since Britain took over the port city in 1842 to use as a gateway to the Chinese markets, the business of Hong Kong had been business, and the power was eld by the hongs. The first handed-down hong was the Jardine Matheson. It was in one case seen to be more influential than the colonial government only present tense it has become a minor player compared to Li Ka Shings Hutchision Whampoa. Li Ka Shing, the prexy or Taipan of Hutchision Whampoa, became the first Chinese to own a traditional hong. Lis drive and business ability helped foster Hutchision into a global conglomerate.Hong Kong depose grew from a small traders bank into one of the Jardine, Matheson & Co. was founded by 2 sparing merchants, William Jardine and jam Matheson in Guangdong in 1832. It was an opium trader that were the pioneers into the China trade. Eventually James Matheson motors control from 1836. It play a key role in the intro of Hong Kong and became the first to purchase land from the colonial government in 1842. Jardine expand into other trade products in other Asian countries like japan and southeast East Asian countries and also enters the ship/cargo handling industry and the real estate business.After World War II, Jardine go their head office from Shanghi cover song to Hong Kong and it offically goes public in the Hong Kong Stock flip in 1961. The 1970s saw Jardine orming many ventures and aquisitions such as the joint venture with the Robert Fleming of UK to create the Jardine Fleming & Co. , a holding company the aquires many foreign and topical anesthetic firms and diversifies Jardines business. The mid- 1980s saw some mismanagments and misguided aquisition e specially after the 1984 Sino-British announcement on the return of Hong Kong.Jardine wanted to diversify more abroad in business organisation of the Chinese takeover because their relations with the PRC was not good. It aquired the British social structure giant Trafalgar House and ther various retail chains in Europe o that Jardine could emphasize more in Europe, but these investments would output signal to be disappointing in the future. The current taipan, or CEO is Alasdair Morrison. He has tried to undo many preceding(a) mistakes and to rejuvenate the 160 year old hong. Morrison has sold off many losing companies and has a greater stress on profitability.The management has been changed to more aggresive and experienced managers such as Ronald J. F buso who previously worked as Kmart Corp. and is known for his turn-around ability. But restricting to of importly, Morrsion has been trying to improve ties with Beijing. He realises that the China market as an indespenable location and has tried repeatly to mend the differences do by the previous Today, the Jardine Matheson group is a multinational enterprise that operates in over 30 countries and employs some 160,000 people.It is divided into eight core companies Jardine Pacific(general trading), Jardine transnational Motors(Car dealership), Jardine Fleming, Jardine Lloyd Thompsion(Insurance), Jardine Strategic, Dairy Farm(supermarket and convenience stores), Hong Kong Land(Commerical property), and the Mandarin oriental(luxury hotel chain) . Last years sales were US$11. 2 billion and a operating profit of US$190 one million million was made. The profits fell 34% from last year, and share prices have locomote almost 60% since it moved its primary listing from Hong Kong to Singapore.The main worry with Jardine is that it unavoidably to use its large cash resources to boost market shares in existing profitable businesses and make aquistions in core business period assests in Asia are dumb che ap from the Asian crisis. It also needs to refocus on Asia, because it is where its main expertise and connections are, but the controlling family, the Keswicks with nly a 4. 9% share are reluctant to invest heavily back to Asia and especially China.The Keswicks have held control through cross ownership to inning a pecuniary defense against hostile takeovers. Li Ka Shing has tried but failed to take over Jardines in 1988 but many still believe that Li has not given up but is rather hold for an opportunity. Although the current taipan, Morrison is trying to shape up Jardine again, many are enigmatic as long as the Keswicks still retain the controlling shares. Jardine Matheson has had a astonishing past, but many fear that the golden days of the past prat D. Hutchison Company was founded in 1828.Being one of the first major traditional hongs in Hong Kong, it had made vast investments in port facilities and other infrastructure projects in the colony. In the 1960s, in an effort to revitalize the hong, John Douglas Clague, the last British CEO of Hutchision made huge investments in not only in Hong Kong but It reoragnized itself to the Hutchision International and up til the early 1970s, many believed that Hutchision would indeed make a comeback as a organisation firm in the colony.However, losses started to occur from 1973, and being overstretched and hort in liquid it lost the favors from its investors and creditors(most importantly the Hong Kong Shanghi Bank). Eventually the Hong Kong Bank would step in to take up 33% of Hutchision International and within 2 years amalgamate with a subsidary, the Whampoa Dock Company and create the Hutchision Whampoa. Hong Kong Bank was looking for a suitable investor to take over the pre-opium war hong and eventually they chose a move real estate tycoon, Li Ka Shing.There are many reasons that Hong Kong Bank chose Li Ka Shing, but two reasons stand out the most, His reputation as a honest nd able businessman and his c ontacts with the government in Today, Hutchison Whampoa has grown into one of Hong Kongs largest blue chip companies with over 70,000 employees universal. The Group operates 5 core businesses place Development and Investment, Ports and related services, Retailing and manufacturing, Telecomminications and Media, and Hutchison Whampoa Property develops residential and commerical properties for sale and lease.Its portfolio includes some of Hong Kongs largest private housing projects and several landmark developments in the Mainland. The groups expertise in port investment and management stems form its pioneering trading operations in Hong Kong. Its port operations arm, Hutchison International Port Holdings, is now export its professional experience and expertise to ports in different Watsons operates three of Asias most innovative retail chainsParkN Shop supermarkets, Watsons personal care stores, and Fortress, sell domestic electrical appliances.The manufacturing division produc es and distributes a wide range of pabulum and beverages throughput Hong Kong, the mainland and other Hutchison Telecom operates a wide range of intregrated elecommunications services worldwide and is one of the worlds major providers of mobile communications The Group has major shareholding in Cheung Kong Infrastructure, which holds interests in infrastructure and related businesses, and power plant projects such as the Hong Kong Electric. It is the sole supplier of electricity to Hong Kong Island.Husky Oil, is one of Canadas largest privately owned oil and gas For the fiscal year ending in celestial latitude 31 1998, The Hutchison Whampoa Group had a net profit after task of HK$8. 7 billion. It was lower than HK$12. 2 billion from 1997. The Asian crisis which rought on pressures on the entire Asian region. It experienced a period of unprecedented addition and price deflation coupled with severe recessionary conditions. These conditions had the hardest impact on the Property/Deve lopment and Retail/manufacturing operations of the group in 1998.Li Ka Shings other main weapon in Asian business is his strong ties to the Chinese Government. He has been favored since being the first Chinese to take over a western hong in the late 1970s. He also played a large role in the transition period for the 97 handover of Hong Kong. Currently he has a trong influence in the policies that effect Hong Kong twain through his contacts with Beijing and the Chief executive, Tung Headquartered in London, HSBC holdings is one of the worlds largest banking and financial services organizations.The HSBC Groups international network comprises more than 5,000 offices The HSBC Group is named after its knowledgeableness member, The Hong Kong and Shanghi Banking Coporation limited. Hong Kong Bank, as it is known for short, was effected in 1865 to finance the growing trade between China and Europe. The inspiration behind the founding of the bank was doubting Thomas Sutherland, a Scot wh o was then working as the Hong Kong Superintendent of the Peninsular and Oriental Steam Navigation Company.He realised that there was considerable regard for local banking facilities in Hong Kong and the China coast and he helped to establish the bank in March 1865. Then, as now, the banks headquarters were at 1 Queens way in Hong Kong and a branch was opened in April 1865 in Shanghai. throughout the late nineteenth century and the early twentieth century, the bank established a network of agencies and branches based mainly in China and South East Asia but also with epresentation in the Indian sub-continent, Japan, Europe and sexual union America.In many of its branches the bank was the pioneer of modern banking practice. From the outset, trade finance was a strong feature of the banks business with bullion, exchange and merchant banking also playing an important part. Additionally, the bank also issued notes in many locations throughout the Far During the Second World War the ba nk was forced to close many of its branches and the head office was temporarily moved to London. However, after the war the bank played a key role in the reconstructive memory of the Hong Kong economy and set about further iversifying the geographical spread of the bank.The post-war semipolitical and economic changes in the world forced HongkongBank to analyse its strategy for act growth in the 1950s. The bank diversified both its business and its geographical spread through eruditions and alliances. However, the bank remained committed to its historical markets and played an important part in the reconstruction of Hong Kong where its branch network continued to expand. In 1965 the bank purchased a controlling interest in Hang Seng Bank, which had been established in Hong Kong in 1933.By the 970s the policy of expansion by acquisition of subsidiaries with their own identities and specialisations was firmly in During the 1980s the bank concentrated on moving into those markets wh ere it was not yet fully represented. Hongkong Bank of Canada was established in 1981 and HongkongBank of Australia Limited in 1986. In 1987 Marine Midland Bank, based in New York State, became a wholly owned member of the Group and its forefront subsidiary in the United States. HSBC Holdings plc, the parent company of the HSBC Group, was established in 1991 with its shares quoted on both the London and Hong Kong stockAlready almost two years have passed since the handover Hong Kong to the PRC. It is hard to judge the impact of the handover to the Hong Kong economy, due to the Asian Financial Crisis in 1997. What is definite however is that Hong Kong has suffered a difficult 1998 and is still in the process of determineing. The good news is that the fallen prices of 1997 got rid of a lot of the bubbles that was being accumulated in the territory. Large landowners like Li may have had some losses but 1999 saw the economic prices and activities picking up again. Many say that the wo rst is over and that recover is in process.Already land prices have recovered a lot of its losses during the 1997-8 The problem in the territory is more a political one. Many incidents have brought attention to the problem of implementing the one country, two system policy, which is fundamental in the Hong Kong Basic Law and which will guarntee the independent governing of Hong Kong. The main attraction that has made Hong Kong what it is today is its efficiency and lassie faire approach shot of the government. If the mainland interferes too much in Hong Kong, it status will decline as the international free port city that has made it so prosperous.