Design and innovation vital: Ngan

Design and innovation are crucial for China's garment industry to move up the value ladder as labor costs will not fall, National People's Congress deputy Pauline Ngan Po-ling said. 

Research and development (R&D) only took up 2.1 percent of China's GDP in 2015. R&D spending in South Korea, by contrast, is equivalent to 3.7 percent of its GDP. Ngan said she did not move the design team out of Hong Kong because with a focus on exports, her designs must remain in a place that has better protection for intellectual property rights. 

"They do tend to copy," Ngan commented on her counterparts that primarily serve the mainland market. "Manufacturers are almost doomed to fail once they step into the overseas market, as they will face and probably lose an avalanche of copyright lawsuits."
Lucrative land value driven by the real estate boom has further eroded industrialists' patience to set up and run a manufacturing business. "Working in this business requires a sense of responsibility and passion because it takes time to wait for a return on your money," she said. 

Her answer to overcome the temptation of fast money is education. "It involves a process," she said. Graduates returning from studies abroad may facilitate this learning curve. 

Nevertheless, she stressed the central government should immediately unleash policies to prevent more factories from going out of business. If no factory survives the market chill, she says, the government's initiative to move industry up the value chain will not materialize. 

Once an opportunity is missed, there is no looking back, Ngan quoted top legislator Zhang Dejiang as saying on Sunday. She feels Hong Kong is already too late to develop a high-tech sector, even though the central government has pledged support in the latest five-year plan. 

"No one can render you help if you yourself are doing nothing," she said.