Statistics from the Shandong provincial department of commerce show that by the end of 2011, a total of 424 Shandong-based companies had established branches and expanded business in Hong Kong, including Shandong Gold Group, Weichai Power Co Ltd, Haier Group and Inspur Group.

They are mainly concentrated in the areas of manufacturing, foreign trade, commercial services, wholesale and retail, tourism and the transportation sector.

"Hong Kong plays an indispensable role in the plans of Shandong companies to go international," said Lu Zaimo, director of the provincial commerce department.

"To sharpen their global competitive edge, we will continue to encourage and help quality enterprises to do business in or through Hong Kong," Lu added.

For these companies, Hong Kong provides many advantages, such as easier merger and acquisition deals, sound financing and logistics services, and a large amount of skilled professionals, he said.

As of the end of 2011, a total of 97 Shandong-based companies realized overseas mergers and acquisitions through regional offices in Hong Kong.

One of them is the Yantai-headquartered Wanhua Group, which consolidated its global footprint by purchasing a 96 percent stake in BorsodChem Zrt, Hungary's largest chemical company, last year, marking the largest investment a Chinese company has made in Hungary.

In one stroke, the move made Wanhua Group the Asia's largest producer of MDI, which is used to make polyurethane, by increasing annual output from 10,000 tons to 800,000 tons. It is also now among the top three producers of MDI in the world.

Hong Kong provides a sound overseas financing platform to local capital-hungry enterprises as well. To date, 37 companies in the province have listed on the Hong Kong Stock Exchange.

Most of them have experienced robust growth and taken a leading role in their sectors since listing, including the China National Heavy Duty Truck Group Corp, Sunnsy Group, Shandong Freda Biopharm Co Ltd, and Inspur Group.

The China National Heavy Duty Truck Group Corp has raised a total of 20 billion yuan since it was first listed on the Hong Kong Stock Exchange in 2007. The funds it raised play an important role in its international expansion and global business.

Shandong Weigao Group Medical Polymer Co Ltd also saw rapid development after listing in Hong Kong in 2004. It is now China's largest manufacturer of disposable medical equipment, with more than 400 varieties of medical products in 30,000 specifications.

Its products include medical consumables, drug-coated heart stents, orthopedic implant materials, drugs and medical facilities.

They have exported to more than 70 countries and regions, including the United States, Russia, South Africa and Brazil.

In another development, "Most Hong Kong-invested businesses enjoy decent development in Shandong," said Lu.Last year saw the total sales revenue of Hong Kong-invested businesses reach 640.3 billion yuan, a year-on-year increase of 30.6 percent, Lu said.

The total profits of these enterprises stood at 50.5 billion yuan, up by 52.5 percent, he added.

Contact the writer at Wangqian2@chinadaily.com.cn.