Innovative business idea in the Asian market

Estudiante: Michael Gaitan Palacios

Código 1721981888

Tutor: Juliana Correa Jaramillo

Grancolombian Polytechnic University Institution or

Asia Regional Economy and Culture
Bogota
2021
 TABLA DE CONTENIDO

Pág.
1. Introduction 3

2. Economic characteristics of the country 5

3. Logistics profile from Colombia to Hong Kong 6

4. Legal framework 9

5. Social variables. 10

6. industrial business analysis 11

7. Competitor analysis 12

8. Market analysis 12

9. FODA analysis 15

10. Conclusions 16

11. Bibliography 17
 INTRODUCTION

A business idea is proposed for the export of emeralds to Hong Kong, in orderto
generate opportunities that favor the economic development of the country,
through a Colombian product
This sector has become attractive enough for foreign investment to come in, which
is also new. Before, emerald mining was developed only by Colombians;It is no
secret to anyone that there were problems of violence and instability inthe region,
which is why no one wanted to invest. There has been a major transformation
then.

This paper presents a business study for the export of Colombian emeralds toHong
Kong following the regulations in force by the National Mining Agency.

An analysis of the emerald market conditions in the city of Hong Kong is

carried out, and a logistic profile of an export to this country is reflected,
projecting important aspects in terms of maritime and air access
ECONOMIC CHARACTERISTICS OF THE COUNTRY

Hong Kong, with a population of 7,474,000 people, has a very high percentage of
immigration, is also in position 103 of the population table, made up of 196 countries
and has a very high population density, of 6,733 inhabitants per km2.

Hong Kong is the 39th economy by volume of GDP. Its public debt in 2020 was 887
million euros, with a debt of 0.28% of GDP.
GDP per capita is a very good indicator of the standard of living and in the case of
Hong Kong, in 2020, it was € 40,941 euros, so it is in a good position, since it occupies
position 18 in the ranking, which which assumes that its population has a good
standard of living in relation to the 196 countries in the ranking of GDP per
capita

• ANNUAL GDP: € 305,996M.

• UNEMPLOYMENT RATE : 3.20%
• EXPORTS: € 480,452.9 M.
• IMPORTS: € 498,834.3 M.
Figure 1 Average inflation data for the year, not end-of-period data.

Fig. 2
Annual representation of emerald exports to Hong Kong.

Source: from Regional Map of Opportunities (2020).

LOGISTICS PROFILE FROM COLOMBIA TO HONG KONG

Fig. 3

Source: Procolombia (2019)

Fig. 4
Frequencies and transit time from Colombian ports

Source: Procolombia (2019)

From the Atlantic coast there are more than 30 connecting routes offered by 13
shipping companies with transit times from 23 days. Transshipments are made in ports
of Panama and South Korea.
From Buenaventura to the ports of Hong Kong, 13 direct and connecting routes
offered by 13 shipping companies, with transit times from 32 days. Connections are
made in ports of Panama and South Korea.

Figure. 5

The top trading countries in terms of Hong Kong exports are the United States,
Japan and China; and in terms of imports, the country's main commercial allies are
China, Japan, Taiwan, Singapore and the United States.

According to the Regional Map of Opportunities, exports from Colombia to Hong

Kong in 2019 had a value of 142,445 thousand USD, showing a significant increase
compared to exports in 2018 with a value of 94,4033 thousand USD.
Figure. 6
Connections of airlines providing service to Hong Kong

Source: Procolombia (2019)

Hong Kong International Airport, also known as Chek Lap Kok Airport, is located on
Chek Lap Kok Island (hence its name), at a distance of 34 kilometersnortheast of
Hong Island.
Kong in China.
There are currently 15 airlines that provide cargo transportation services to Hong
Kong. The connections are made mainly in cities in France, the United States,
Spain, the United Kingdom, Germany, Canada, the Netherlands, Mexico,Turkey
and Belgium.
LEGAL FRAMEWORK

Illegal mining is defined as that which carries out "exploration, extraction or collection
of nationally owned or privately owned minerals, without the corresponding current
mining title or without the authorization of the owner of saidproperty" (Mining Code,
2001, Art. 159).
Illegal mining becomes a legal problem in emerald extraction
since:
It evades environmental controls, the environmental license is omitted, with which it
isevaluated what impact a mining activity may have on the environment, as well
as whether the activity can be modified to make it sustainable and have the
permission toexecute it.
It frees itself from the payment of tax burdens and royalties, subtracting immediate
benefits from people in mining areas, in terms of health, education and protection
environmental.

The inputs for the implementation of competent mining public policies and
environmental policies are reduced, since the supervision and regulation of such
activities is evaded.

Because our economic activity is based on the export of emeralds, we will requireprior
permits to authorize the export, in this case, the one who gives us the go- ahead will be
INGEOMINAS.
We will be subject to the following laws to carry out the export:
• Royalties (Article 17 of Law 141/94; Resolution No. 8 1938 of 25
August 1995)
• Resolution No. 8 2187 of September 20, 1995 of the National Agency
Mining
• Procedure to export emerald from INGEOMINAS
• Law 7 of 1991: Foreign Trade Framework Law
SOCIAL VARIABLES.
Emerald production is largely destined for export; It is estimated that lessthan 5%
of the production stays in Colombia and 95% is sold abroad.

(UPME. 2006. National plan for mining development, vision to the year 2019)
Historical production of emeralds in Colombia

Figure 6

Source: adapted from Statistics Official Production of Minerals in Colombia

INDUSTRIAL BUSINESS ANALYSIS
The exporting companies with the largest participation in the market during 2006stand
out ten companies, which share more than 60% of the income obtained by emeralds

Fig. 7 Emerald export companies in Colombia

Source: Legicomex

Colombia has established itself as one of the countries with the greatest economic
stability in the Andean region. This is expressed in indicators such asGDP, foreign
direct investment, trade balance and industrial outlook. We have also had an
increase in the jewelry and costume jewelery trade of the
35.4% more than in the previous year, which is a market that is closely linked to our
activity.
COMPETITION ANALYSIS.
In the investigation of national competition for the export of Colombian emerald, the
company Mina de Piedras is found in which there is a great gap in the search for
information from this company towards the
consumer.
As for the price for the companies they are high, especially with high and medium
quality emeralds.
In distribution channels there is little interest in web pages, although there arepages
that sell emeralds, those that exist have little content.
Analyzing these aspects shows the importance of a good market study analyzingeach
of the aspects for export growth
emeralds
MARKET ANALYSIS
According to the Mining and Energy Planning Unit (UPME) published in the
In 2018, the emerald has no other use other than jewelry and although it can be
traded in its natural state, this represents a small part of the market, exclusively for
collectors.
The technology developed around the emerald value chain is mainly focused on the
extraction process, while the other stages are developed in a traditional way.

Fig. 8

Source: Upme
The Purpose of the value chain is to increase the quality of the emerald and thereby
increase its price, from the first stage of extraction in the mine, the selection of the
stones and the transformation of the same must be perfected in order to
get the most out of the gem.
Main destination countries for emerald
exports gives

Figure.9

Source: Legiscomex
TYPES OF EMERALD

Fig. 10
TARIFF CLASSIFICATION OF EMERALDS

7103912000

Fig. 11

To export precious stones from Colombia it is necessary to have the authorizationof

DIAN and the National Mining Agency.

COMMERCIALIZATION
Inge ominas is authorized to proceed with the issuance of export guides that
protect emeralds to perform functions related to trade, the generation of the guides
requires a process of inspection and verification of emeralds.

In Colombia, the price per carat of a Muzo emerald ranges between US $ 300 andUS
$ 10,000 depending on its quality, since there is a great variety in the purity and color
of the stones.
FODA ANLYSIS

The investigation shows how successful GreenCol will commercialize

Colombian emerald. Emerald is the most precious stone in the beryl group.

Weaknesses:

- Bargaining power over suppliers

- Low logistics level
- Lack of interaction with the customer
- Low technological level
- Lack of marketing - Low presence worldwide

Opportunities:

- GreenCol has extensive added value

- Develop new distribution channels
- It has a wide differentiation with respect to current competitors
- There are no companies that have generated brand identification
- Strategic Alliances
- Opening of a web portal, broadens knowledge about the brand and facilitates the
dissemination of information
- Modernization in business model – Marketing

Strengths:

- GreenCol meets new needs for consumers

- Manages a customer relationship system that allows you to establish more
long-term purchases.
- It has a commercial structure that will make the product known
- Motivated and highly prioritized human talent and management
- Has a constant investment of intellectual capital in research and development
- Specialization in selling emeralds internationally
- Generates security when making a sale

Threats:

- Uncertainty regarding market behavior

- Growth in the share of high-quality emeralds that are not
Colombian
- Changes in market conditions
- Rivalry Between Close Competitors - Emerald Shortage
CONCLUSIONS

Colombian emeralds are not only the most beautiful and precious, but they are
uniquebecause their formation process differs from that of other emeralds in the
world. world.
Our emeralds were not produced by metamorphic processes in intrusive igneous
rocks (which are formed from the slow cooling of magma), but byhydrothermal
processes where saline fluids were released by tectonic movements and came into
contact with evaporites (salts formed by the evaporation of marine waters).
The unusual combination in the same piece of a good size, an attractive and intense
green color and a clarity above others in the world, is what makes theColombian
emerald the best quality.
The Colombian emerald is recognized worldwide for its exceptional quality,far
surpassing the emeralds produced in countries such as Zambia, Brazil, Egypt and
Russia.
The good results of the industry have allowed the emerald sector in Colombiato
contribute to a growing social management in its areas of
influence.
Different sectors of the economy interfere in the production of emeralds, this is a
fundamental part in the generation of employment and economic growth of the
country
Hong Kong is a potential importer of exclusive jewelry worldwide, specifically
precious stones such as emeralds. For this reason, it represents an opportunity
to enter the market in greater depth.
Oriental.
 BIBLIOGRAPHY

Legiscomex. . Joyeria y Bisuteria en Colombia

Agencia Nacional de Mineria. (Mineria en Colombia.)

https://mineriaencolombia.anm.gov.co/

Fedesmeraldas ( Federacion nacional de esmeraldas de colombia)

http://www.fedesmeraldas.org/

Procolombia (exportaciones turismo inversión marca país)

https://procolombia.co/?__cf_chl_jschl_tk__=2853abd342170bb2254581f363553f6
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uM2TxrPhN9kJZNOYantWZjZaPVDwmi41BXr4Jth-
9Gd2UmZNUK_gjrhTPgpGiZhdayO_61u3XnPTqlH81HSi-
mQjbiL2Gb8Ffk4wdok2lxyxJXXJFJNvDDTAvZcfdAtDfHNVEEVZG9vZiZec5ZHkqa
otD4f-vkdgtAbxuxbx3cQ_a8lvVlPUOE-w26bfceqtksCcZbdFvJHqPVR-
6XgqXoyIR7Ar9dWBIZBz0rYKHp8zbCyVfQUAqOryr8k8q55EKA4jzO8-
i1uNbFpk0FkpWxoGEu3Frwac4jMLMW0SycJw4GV7TxqRHpcbOEgcGrwQ3oif3T
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ZHSzSkKtDZ-LA

Upme (Unidad de Planeación Minero Energética)

https://www1.upme.gov.co/Paginas/default.aspx

Mapa regional de oportunidades. maro.com.co

Expansión (datos macro) https://datosmacro.expansion.com/paises/hong-kong