'Cepa', or the Closer Economic Partnership Arrangement, is a free trade agreement between Hong Kong and the Chinese mainland that offers preferential access to many Hong Kong-based companies and their overseas partners.

While Cepa covers trade in goods and services, Ms Porges says service providers have the most to gain from the agreement.

"The first firms in the market can gain decisive advantages in terms of market share and profitability," she said, "and the earliest firms to market have the position to set the standards for products and services."

Ms Porges said the head start offered by Cepa over China's WTO commitments was particularly important in terms of early access to the best resources.

"You may need to find local partners, the best agents, employees and franchises," she said. "Late comers risk taking the leftovers."

The other key advantage Cepa offered was in its capacity to reduce costs for companies seeking China market entry. "This is a very striking aspect of Cepa, given the limited nature of market opening under WTO. Many services have high capital and trading requirements. These cost money and translate to real costs. These costs may close the door to smaller companies."

Cepa, she explained, opens China to some mid-size companies which are squeezed out of China.

While Cepa looks set to further boost Hong Kong's economy, Ms Porges said China also stood to benefit. "Cepa benefits Chinese exporters and producers. All these services are inputs for manufacturing and job creation in China."

Ms Porges urged American companies to learn more about Cepa saying it was "quite possible that you would see renewed interests from US firms in investing in Hong Kong companies and mergers and acquisitions."

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