Why China’s cybersecurity company Qi An Xin set up Hong Kong headquarters to boost global expansion

The company, which set up its first office in the city in 2020, believes now is an opportune time to further expand its presence in Hong Kong, especially since the establishment of the Office for Attracting Strategic Enterprises (Oases) at the end of 2022.

Oases is a Hong Kong government initiative, first introduced in Chief Executive John Lee Ka-chiu’s 2022 Policy Address. It aims to encourage investment and cutting-edge companies, focused in areas such as life and health technology, artificial intelligence (AI) and data science, financial technology, and advanced manufacturing and new-energy technology, to set up – or expand – their businesses in the city.

QAX, which has its head office in Beijing, was among the first batch of 30 foreign and mainland Chinese companies signed up as strategic enterprise partners of Oases.

That means the company has a one-stop-shop it can turn to for help with things such as organising personnel visas, recruitment of advanced talent, marketing and promotion, he says.

“There are also subsidies for us to employ highly educated talent, such as those with PhDs and master’s degree holders, and support for our market activities and promotions. The entire service system is a very thoughtful one. As long as cybersecurity businesses make good use of these initiatives by the Hong Kong government, it will be very beneficial to the industry.”

Last December, QAX officially opened its Hong Kong headquarters alongside the group’s international research and development (R&D) centre at Hong Kong Science Park, in Pak Shek Kok, New Territories, which made it the park’s largest cybersecurity company.

From this office it will provide high-level security services to the public and private sectors, while focusing on areas such as network security technical research, laboratory set-up and testing, and helping to nurture cybersecurity talent.

QAX, which was founded in 2014 and has more than 60 branch offices across mainland China, now holds a prominent position in the field of cybersecurity, providing solutions for clients not only in China but also abroad.

It was ranked first on “China’s Top 50 Competitive Enterprises in Cybersecurity Industry” list, published by the national not-for-profit industry body, the China Cybersecurity Industry Alliance, for three consecutive years from 2021 to 2023.

QAX has already built up strong foundations in markets in Southeast Asia and North Africa, and is keen to tap into new overseas markets, including those countries situated along the trade routes of China’s Belt and Road Initiative – the central government’s plan to grow global trade.

The company garnered international recognition serving as the official cybersecurity services and antivirus software sponsor at the Beijing 2022 Winter Olympics, where it achieved a commendable “zero incident” record, He says. This international sports event has a long history of being targeted by hackers and malware.

To maintain its leading position, the company invests heavily in innovation. “About 30 to 40 per cent of our staff work in R&D,” he says. “That probably amounts to the entire workforce of many companies.”

Yet such investment is a necessity as the cyberattacks carried out on global businesses are growing increasingly sophisticated. “Cyberattackers are applying AI to their activities, so it is also being used in the realm of cybersecurity,” he says, adding that AI is also used for reading cyberattack logs to increase efficiency and accuracy.

He says Hong Kong is a good testing ground for cybersecurity products as the city has very high standards in this regard.

“Cybersecurity product users in Hong Kong have had much experience using a wide range of world-leading security products and earned a good understanding of them, including these products’ strengths and weaknesses,” He says. “These users are excellent adjudicators for our products, and their valuable feedback and assessment represents an important threshold for us as we internationalise our products for the overseas markets.”

Hong Kong’s history of bilingual education, with English more widely used in the city compared with mainland China, is certainly an advantage for QAX and will provide valuable insights for creating and testing global products, he says. The company’s expanded set-up in Hong Kong also complements the hundreds of staff based across the border in China’s Guangdong province, including an R&D centre in the city of Zhuhai.

QAX’s accelerated global expansion comes at a time when the world is facing unprecedented challenges in cybersecurity.

Up to 73 per cent of companies questioned for last November’s “Hong Kong Enterprise Cybersecurity Readiness Index” survey reported experiencing cyberattacks during the previous 12 months – a record high since it was first published in 2018.

Last year, the World Economic Forum, a Swiss not-for-profit foundation, reported that the average annual cost of global cybercrime is projected to rise from US$8.4 trillion in 2022 to more than US$23 trillion by 2027.

It said such industry disruption was most prevalent in the Asia-Pacific region, which has emerged as the new “ground zero” for cybercrime incidents. The foundation quoted a survey by Check Point Research showing that the region had experienced the highest year-on-year rise in weekly attacks – an increase of 16 per cent – with an average of 1,835 attacks per organisation; the global average totalled 1,248 attacks per week.

The same survey said Asia-Pacific was particularly vulnerable to cybercrime because it was undergoing an accelerated digital transformation, but awareness and knowledge of rising online threats has failed to catch on.

He says that numerous businesses working across many different industries do not have enough resources to establish their own cybersecurity teams, despite having to increasingly digitalise their operations.

However, this is where QAX and its cybersecurity expertise comes in, He says. “We are not just about selling clients a product; we also assist them with training in product usage, running a secure operation, and how to use these machines to achieve their maximum effect.

“Clients also require services such as penetration testing and emergency response. This is because it is not feasible for them to employ a large number of their own professional cybersecurity personnel.”

He says QAX is also known for what he describes as its “Lego-style” solutions. “Every industry has its own characteristics and, accordingly, their needs for products and solutions vary,” he says.

“We offer a broad range of products from endpoint security to boundary security, data security, and industrial control systems. Like playing with Lego bricks, our products fit onto a base platform and then we can build out different solutions that meet the specific needs of different industries and clients.”

With so much of the world now found online, including everything from medical records and infrastructure controls to the financial system, the importance of cybersecurity will only grow in importance.

“This industry will experience growing prominence in the coming years and become recognised by more people,” He says. “It is our company’s unwavering mission to safeguard cybersecurity, not only in Hong Kong, but around the world.”