Hong Kong ( CNN ) -- You may think Santa 's grotto is hidden in a snow-covered Arctic cabin , but those in the know say its real location is Hong Kong 's cavernous harbor-front convention center . Each January for the past 40 years , the world 's toy makers have converged on the city for the international toy fair -- the world 's second largest . Eyes peeled for next Christmas 's must-have toy , buyers scour some 2,000 stalls that tout everything from classical wooden blocks to high-tech remote control gadgets . `` It 's like Santa 's paradise , there 's absolutely everything that you can dream of here , '' said one Russian buyer who identified himself as Sergey . The fair , which finished on Thursday , featured everything from virtual pet rabbits to an area that showed how toys have therapeutic benefits for both children and the elderly . Hong Kong 's toy industry , which has struggled in recent years , may be slowly returning to its glory days , according to the fair 's organizer . Although the factory floors that were once dotted across the city are now in mainland China , Hong Kong still maintains its status as a hub for the toy industry . `` Hong Kong is the world 's toy town , '' said C.K . Yeung , chairman of the Hong Kong Trade Development Council ( HKTDC ) Toys Advisory Committee . `` The designs , engineering , support services and also sales and marketing platforms , these are all in Hong Kong , so buyers are coming here to shop . '' Alex Wong , sales manager of Wange Industrial Co based in China , which sells toy blocks , says the city is the ideal place to showcase his wares to the international market . `` Hong Kong is a financial center , we can introduce our products there , '' he said . Safety concerns . China 's reputation as a toy manufacturer took a hit in the last decade over safety concerns . In the largest scandal in 2007 , millions of Chinese-made toys were recalled due to lead contamination . But Yeung said that standards were improving and were now equivalent to those found in the United States or Europe . Among the new standards is a ban introduced last year on six kinds of phthalates -- substances that can be absorbed through the skin and are believed to cause hormone malfunctions and deformations . The move was widely praised by numerous activist groups such as Greenpeace . Remi Leclerc , a professor who teaches toy design at the Hong Kong Polytechnic University , says while the city remains an industry hub , Hong Kong has struggled to develop its own toy brands , instead specializing in manufacturing for big , multinational players . `` Hong Kong is trying to move away from that model , the revenue is developing a brand and being able to strategically manage it , '' he said . `` Breaking that glass ceiling has been difficult here . '' Leclerc also said Hong Kong must think carefully how it can stay ahead of mainland China , which has been making strides in both quality and marketing . `` Hong Kong at this point has no competitors in terms of training and developing that know-how , not only on that production level but also in the future in terms of value creation , '' he said .
China hosted the second largest toy fair in the world January . Buyer likens it to a `` Santa 's paradise '' The city 's toy industry is on an uptick , according to CNN 's organizer . Safety regulations for toy manufacturing in Hong Kong have improved .