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Face value / Smooth operator
Oct 18th 2007 From The Economist print edition
Read this report carefully. At he bottom you will find a question. Draft and submit your answer

A Hong Kong entrepreneur shows Disney how to run a theme park Courtesy of Ocean Park “WE OWN Halloween,” says Allan Zeman. It would be a peculiar comment in most places, perhaps, but is well understood in Hong Kong, whereOctober is a time when children flock to Ocean Park, an amusement park owned by the government. Its popularity is the result of a magical transformation wrought by Mr Zeman, a
Canadian-born entrepreneur who originally made his money out of bars and women's clothes.

Four years ago Ocean Park was on its last legs, with attendance sliding and its facilities crumbling. A formidable new competitor,Disney, had arrived. Hong Kong's usual remedy for anything unprofitable is to flog it to a developer handy with the bulldozers. If 2003 had been a normal year, Ocean Park would have survived only as a memory. But the times were out of joint: in addition to the lingering financial crisis,
SARS, a respiratory disease, had hit, and there were protests over the Chinese government's efforts tocurtail civil rights. It was a bad moment to destroy something fun. In desperation, the island's then chief executive, Tung Chee-hwa, asked Mr Zeman to take over the park.

It was an odd choice. Before then Mr Zeman's main service to the public had been to transform warehouses into a wildly popular drinking district known as Lan Kwai Fong. Although Ocean Park
was just a few minutes away from hisoffice, Mr Zeman had never visited it. Startled by the offer,
Mr Zeman said no, again no when it was repeated, and then no four more times. He relented after his sixth refusal, perhaps reasoning that since he had built successful saloons without being a drinker himself, he could run an amusement park without having taken a ride.

Four years later, the Mouse is stumbling and Ocean Park is thriving.At Disney's park attendance is widely reported to have fallen (the firm does not publish visitor numbers), whereas visitors to Ocean Park have increased from 3.7m in the year ending June 2004 to 5m for this year. Losses have become ever larger profits and Mr Zeman is walking on air, a Hong Kong hero who saved a local institution.

Mr Zeman's father died when he was young and he had to becomeindependent. By the age of 16 he finished high school in Canada, having already earned more from his paper round, he says, than
many of his friends' parents did from their businesses. He got a job as a shipping clerk for a Canadian lingerie company and then quickly moved into sales at another firm. Another job in women's-wear convinced him that the real problem—and hence opportunity—in the rag tradelay with Canada's trade unions, whose demands hurt profits. Aged 19, he opened his own business importing clothes from the more employer-friendly Far East. By 20, to avoid taxes, he was operating from Hong Kong.

From lingerie to jellyfish

Again, Mr Zeman quickly spotted a problem—the quotas America placed on imports from individual countries—and a chance to make money. He opened an officein China in Hunan province, Mao's birthplace (it worked for Mao, says Mr Zeman), and then more than three dozen offices
throughout Asia. That way he could aggregate all the quota allowances. Mr Zeman sold the firm in
2000 to its largest Hong Kong competitor for HK$2.2 billion ($282m) in cash and shares.

Lan Kwai Fong began simply because Mr Zeman needed to keep the boyfriend of a talentedemployee happy. He gave him a restaurant in a quiet old warehouse; it turned into a huge success and then Mr Zeman added dozens of others. It helped that Wanchai, the main area for nightlife in Hong Kong, was then a fading redlight district filled with seedy hostess bars. But before Mr Zeman arrived, no one had noticed the gap in the market. When he got to Ocean Park, Mr Zeman…

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