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Thursday, 17 January, 2002, 11:59 GMT
Hong Kong entrepreneurs struggle on
Hong Kong's Victoria Harbour
Hong Kong is seeing a growing numbers of business failures
By the BBC's Stephen Vines in Hong Kong

After decades of consistent economic growth Hong Kong is facing up to the reality of a sharp reduction in growth prospects.

This has produced unprecedented levels of deflation, considerable unemployment and growing numbers of business failures.

Yet Hong Kong prides itself on its ability to recover from adversity.

This may explain why there is so much local appetite for stories about business people who are finding ways of scrambling out of the rubble.

Fast success

Few stories are more dramatic than that of Ivan Chan.

In the go-go years of the late 1980's he started to build up a chain of fast food restaurants, called Farm House.

They mainly served Chinese versions of Western food.

Within 11 years he had opened 48 outlets, employed 1,300 people and was pulling in just under $200,000 per day.

Economy in crisis

When the Asian financial crisis hit Hong Kong in 1997 he was still expanding and borrowing large sums of money from banks only too keen to provide finance.

Hong Kong job centre
There is considerable unemployment in Hong Kong
The following year business slowed and Mr Chan borrowed yet more to pay his rent and wage bills.

Like many other business people, and the Hong Kong government for that matter, he thought the downturn would soon pass and his problems would disappear.

It did not and his problems deepened to such an extent that he was declared bankrupt.

Starting again

At the age of 40 he was, according to his own account, penniless, and desperately searching for a means of earning an income.

Instead of looking for a job he took the more typical Hong Kong route of seeking an entrepreneurial solution to his problems.

Scrapping together some funds he went out and bought children's books and started hawking them around schools.

Now he mainly sells Harry Potter books and gets his sons and daughters to help out at the weekends.

His resolute optimism and determination not to give up has earned him considerable public attention and a column in one of Hong Kong's biggest selling newspapers which is also looking for ways of accentuating the positive.

Not giving up

About two years before Mr Chan's business went belly up, an even bigger enterprise, the Maria bakery chain was forced out of business.

Its founder Maria Lee Tseng was aged 70 at the time of the collapse.

She had plenty of excuses to retire and contemplate her loss of fortune but she was no mood to disappear quietly.

Instead she got busy with plans to sell food and lifestyle products over the internet.

The results have not been particularly successful but Maria, as she is best known in Hong Kong, is widely admired for not giving up.

From failure to success

There are a number of other, less high profile stories about how failed business people or workers made redundant by bankruptcies have tried to claw back.

They are given a lot of space in the local media because there is a healthy appetite for tales of recovery, particularly those which seem to contain lessons for others facing economic difficulties.

Hong Kong is a pragmatic sort of place which readily forgives failure as long as it is followed by success.

Although ironically the government is becoming more interventionist, most people still look to their own resources to find solutions to the economic downturn.

The backbone of Hong Kong society consists of immigrants and the second generation descendants of immigrants.

They are hardy self reliant people who are not easily discouraged by failure.

Although things seem pretty bleak at the moment, even the pessimists are looking for ways of turning economic adversity into opportunity.

See also:

08 Jan 02 | Business
Hong Kong shoppers take fright
10 Dec 01 | Business
Hong Kong bankruptcies surge
05 Dec 01 | Business
PCCW adds to HK job cuts
23 Nov 01 | Business
Hong Kong prices keep falling
31 Aug 01 | Business
Hong Kong recession fears grow
21 Aug 01 | Business
Hong Kong warns on economy
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