Hongkonger David Chiu Tat-cheong was in his early 30s when he decided to part ways with his father’s business and strike out on his own somewhere else.
“I wanted to go to a country that my father was not familiar with,” he recalled. “I was young and wanted to start a business. That would be a bit more exciting.”
That was the late 1980s. He set his sights on Malaysia, as his father, the late entertainment and property tycoon Deacon Chiu Te-ken had already left his mark in Singapore and Indonesia.
After his first few small-scale property projects proved successful, Chiu moved to Malaysia with his wife in the mid-1990s to build a real estate development business from the ground up.
“If you’re going to embark on something big, you have to live in that country for two or three years because you aren’t entitled to leave the place until you are familiar with it,” Chiu said.
He brought with him ideas from Hong Kong such as show houses, common leisure facilities for condominium projects and smaller flats.
“Things that felt ordinary in Hong Kong more than 20 years ago were very novel in Malaysia,” he said.
His bet on the country paid off. Chiu’s Mayland Group of Companies is now among its leading developers, with about 8,000 new homes due on the market this year alone, while his Dorsett hotel group operates about 4,000 rooms there.
“Malaysia has afforded me a great opportunity,” said Chiu, who was honoured by being made a “Dato” in 1997 and given the title “Tan Sri” in 2005.
The real estate tycoon, who is chairman of Hong Kong-based Far East Consortium, joined part of Chief Executive John Lee Ka-chiu’s weeklong visit to Singapore, Indonesia and Malaysia in July.
Impressed by the reception Lee received in all three countries, he noted that in Kuala Lumpur, the red carpet was rolled out at the airport terminal, something usually reserved for leaders of large countries.
“That was quite an honour for Hong Kong and the chief executive. I was quite surprised,” he said.
On the day Prime Minister Anwar Ibrahim met Lee, Malaysia announced that it would extend visa-free stays for Hong Kong passport holders from 30 days to 90.
That showed the importance the Malaysian government attached to the Hong Kong leader’s visit, Chiu said.
The chief executive also met Singaporean Prime Minister Lee Hsien Loong and Indonesian President Joko Widodo.
Chief Executive Lee pointed out that the 33 arrangements agreed upon between Hong Kong and local entities in the three Asean countries would open more doors for further, deeper collaborations.
Tycoons saw Southeast Asia’s potential
The Pearl River Delta has been China’s gateway to Southeast Asia for centuries, and Hong Kong has been open to the region since its early colonial days as an entrepot.
Savvy Hong Kong businessmen have long had a presence there.
CK Hutchison, controlled by Hong Kong’s richest man Li Ka-shing, operates Indonesia’s largest container port at Jakarta through Hutchison Ports, which also runs ports in Malaysia, Vietnam, Thailand and Myanmar.
Personal care retailer Watsons, part of CK Hutchison, is a major player in the region, and opened its 700th store in Malaysia in June.
Li’s son Richard Li Tzar-kai is making his mark there too. His streaming unit Viu has beaten Netflix in Southeast Asia in terms of monthly active users, while insurer FWD is seeking to list in Hong Kong after building a heavy presence in seven Asean countries through a decade of acquisitions.
In 2022, the 10 Association of Southeast Asian Nations’ economies combined were Hong Kong’s second largest trading partner, with four Asean nations among the city’s top 10 trading partners.
“Southeast Asia nowadays is no longer the Southeast Asia we used to know,” said Jonathan Choi Koon-shum, chairman of Hong Kong’s Chinese General Chamber of Commerce. “It offers diverse potential for bilateral and multilateral developments.”
His Sunwah Group, founded in 1957 by his late father Choi Kai-yau, has witnessed a fair share of changes in the region.
Known as the “Seafood King”, Choi senior made his early fortune by exporting processed seafood to Japan in the 1960s and went to Vietnam in 1970 to source prawns.
His Vietnam seafood business not only survived through the end of the Vietnam war, but also thrived in the newly unified communist-run country, expanding to include coffee exports, real estate and finance.
Sunwah’s portfolio in Ho Chi Minh City now includes two luxury riverfront residential developments and a 23-storey office tower on the tree-lined thoroughfare leading to the iconic city hall. The group is also involved in a seaside resort development south of the ancient town of Hoi An.
As a standing committee member of the Chinese People’s Political Consultative Conference, the country’s top political advisory body, Jonathan Choi has been facilitating exchanges between Asean and mainland Chinese officials and businesses.
He said he believed Vietnam expected Hong Kong to be more than a mere broker or a “super connector” with the mainland.
Using his own company as an example, he said: “They want the Sunwah Group from Hong Kong to invest more money, so we are a major investor. And after investment, we operate a lot of the projects too.”
Mindful of the historically complex relationship between Vietnam and China, Choi said that in his business discussions in Vietnam and elsewhere, he always steered clear of either side’s politics and focused on the mutual benefits of his investments.
“People are wary. If I talk about my connections with Beijing, they will think I have something special to do in conjunction with Beijing,” he said. “Instead, I put aside all my Beijing ties and be just a Hong Kong businessman coming to do business, nothing else. They will feel more at ease.”
Under Beijing’s 14th five-year plan, Hong Kong has a mission to establish itself as an international and regional hub in eight aspects, including traditional strengths in finance and trade, and newer areas such as innovation and the arts.
Brian Wong Yue-shun, an assistant professor in political philosophy at the University of Hong Kong, said businesses in the city hoping to tap into prospects in Southeast Asia should do more than be a gateway to the mainland.
“Hong Kong needs to think more creatively about what it can do for Asean economies,” he said. “It’s not just about Hong Kong serving its motherland, which is important, but it’s also about how Hong Kong as a part of the Southeast Asian ecosystem can help professionalise and transform industries and sectors within the Southeast Asian economies.”
‘Pays to have good local partners’
Hongkonger Hayden Lui Chi-chun has called Indonesia home for two decades after being deployed there by a logistics firm at the age of 23.
Along the way he married the daughter of a Hong Kong businessman. Having lived in Indonesia for five decades and witnessed a string of political upheavals, his father-in-law always wanted to find a way to support less-privileged Indonesians.
About 10 years ago – when e-commerce was in its infancy in Indonesia – his father-in-law asked him to start a new business that could make life easier for small firms in the country.
He quickly identified a gap that needed plugging – how to make paying for online purchases more convenient. It would also help small and medium-sized enterprises save costs in handling payments.
Recalling what it was like at the time, he said: “Once I made my selection online, I’d have to make a transfer on an ATM machine, take a photo of the receipt and send it to the e-commerce platform as proof of payment. Only then would my purchase be dispatched.”
With Hong Kong’s Octopus stored value card in mind, he described the overseas experience of online payment to Indonesia’s central bank, and in 2012, founded the online payment solution provider Ezeelink.
Indonesia’s e-commerce took off as he expected, but the real turning point for his business came in late 2019 when a new law was passed to require all online storefronts to seek a local permit.
It sent overseas sellers scrambling for local partners and new arrangements to recoup revenues.
By that time, many mainland vendors had begun targeting young Indonesian customers online, after being let down by the saturated markets in the West and stricter rules imposed by US-based e-commerce giants.
Merely months after the new policy was in place, the Covid-19 pandemic hit, bringing a fresh wave of mainland sellers.
“The Chinese domestic economy was not doing great and manufacturers had to make ends meet by opening up new markets to digest their stockpiles,” he said. “In response, we developed a new virtual account product to provide them a foreign exchange settlement service.”
Lui’s firm is now helping overseas vendors meet the local permit requirements and link their online storefronts to all common payment gateways of Indonesia.
With more Chinese merchants making their way to Indonesia, he expected virtual account clients to make up about 30 per cent of his business by the end of 2023. He was also looking for a Hong Kong partner in the financial sector to provide financing solutions to online vendors.
“As an Indonesian payment company, we have an edge in getting in touch with more cross-border e-commerce companies because of our Chinese background. With a common language and culture, we are better positioned to understand the needs of our cross-border merchants,” he said.
The Asean–China Free Trade Area has been in place since 2010, while Hong Kong’s free trade agreement with Asean came into effect in 2021.
The city is now seeking to join the Regional Comprehensive Economic Partnership, the world’s largest trade bloc that includes China and all 10 Asean countries. City leader Lee said all three state leaders he met were in support of Hong Kong’s bid.
Lui, a deputy director of the Indonesia Chamber of Commerce in Hong Kong, said few Hongkongers were running companies in Indonesia and he hoped Lee’s visit would draw their attention to opportunities in consumer products and infrastructure in the country.
“We can gradually educate the local Indonesian team with the spirit and commitment we have in Hong Kong,” he said. “If you manage to build a more efficient team, you will definitely earn a competitive edge in this big market where competencies are uneven between rivals.”
Having seen others burnt in the past, Lui and real estate tycoon Chiu advised Hong Kong entrepreneurs to secure trustworthy local partners to deal with bureaucracy and cultural complexities.
Chiu said a proper understanding of local politics would also go a long way.
“Hong Kong is such a society of freedoms that you can make a living even if you never talk about politics. But in Southeast Asian countries, you must have a clear understanding of the politics and directions,” he said.
To that end, the Hong Kong-Asean Foundation has been running education programmes in universities to prepare students for capturing the emerging opportunities in Southeast Asia.
The non-profit organisation was set up in 2022 by Sino Group’s deputy chairman Daryl Ng Wing-kong to promote mutual understanding between Hong Kong and Asean.
Foundation CEO Charles Chia said: “For any business opportunity to flourish, I think the first thing you have to know is your counterparty.”
He observed a lack of understanding of market opportunities, including those arising from Indonesia’s rich raw materials and the relocation of its capital to Kalimantan.
While working to connect Hong Kong trade-related associations with their counterparts in Southeast Asia, Chia stressed it was also important to foster a better cultural understanding in the local business community.
“Who are you doing business with? Do you trust the person? That trust has to be built on … a platform of understanding of customs, of beliefs. And that is obviously the bedrock of any sustainable, long-lasting business relationship,” he said.
“Southeast Asia is diverse. So when Hong Kong people deal with Asean nations, it’s different when dealing with the Thais and the Cambodians, and so on. They are all different.”