David Wong believes city should play to its traditional strengths in financial and professional services, as well as connecting Chinese mainland with the world.
The development of a city cluster in the Guangdong-Hong Kong- Macao Greater Bay Area was endorsed by Premier Li Keqiang as a national strategic project in his annual work report delivered last month.
Eleven cities are officially considered part of the bay area: Hong Kong, Macao, Shenzhen, Guangzhou, Foshan, Zhaoqing, Jiangmen, Zhongshan, Zhuhai, Dongguan and Huizhou. It is home to more than 67.6 million people, exceeding the population of Britain, and had a GDP of more than $1.3 trillion last year, similar to that of South Korea. It should be noted that the GDP of Guangzhou has surpassed Singapore’s and that of Shenzhen is close to Hong Kong’s. The financial magazine The Economist recently did a special report on the Pearl River Delta (PRD) region. Needless to say the report was full of praise for the region and considered it to be the most economically dynamic part of China.
The public may not have heard of the Greater Bay Area concept until recently but it was actually part of the Belt and Road Initiative suggested in a national policy paper in 2015. The central government has set an ambitious goal for the bay area: to compete with other world-renowned bay areas such as those in Los Angeles, New York and Tokyo Bay. Hong Kong has been the economic leader of the bay area but has faced challenges from Shenzhen and Guangzhou in recent years. The plan required that each city in the area should be complementary to the others and make fuller use of its own advantages. Therefore, it is important for Hong Kong to focus and enhance its core strengths.
Financial services are undoubtedly Hong Kong’s greatest and most apparent strong point. It has a vibrant stock market that comprises not only Chinese companies, but recently it was reported that the world’s most valuable company, Saudi Aramco of Saudi Arabia, was considering floating its shares in Hong Kong. The special administrative region also has a strong and long tradition of global vision and connection since its days as a trading hub. We continue to act as a super-connector between the Chinese mainland and the rest of the world. Moreover, Hong Kong’s professional services — such as legal, accounting, arbitration and accreditation — are also highly regarded around the world. In other words, Hong Kong has a solid footing in providing high value-added services to the Greater Bay Area.
However, Hong Kong cannot afford to be complacent. Since the handover, the SAR government has reacted unenthusiastically toward closer economic cooperation with the PRD region, partly because of our own arrogance; we did not believe there is much to gain from the collaboration.
To this day, many in Hong Kong continue to underestimate the economic development and potential of the bay area. Gone were the days when Shenzhen was merely a destination for massages and purchasing counterfeit handbags, it has now surpassed Hong Kong in innovation and technology. Global technology and internet giants such as Tencent, Huawei, Dajiang Innovations and ZTE Corp have their headquarters and research centers in Shenzhen. There is also a high valued-added supply chain across the bay area that supports the development of new and innovative technology.
Ma Xingrui, governor of Guangdong, opined that the three key factors for the success of the bay area were the free flow of people, capital and goods. Currently, the flow of goods within the area is relatively unrestricted since there are few or no tariffs. The Hong Kong-Zhuhai-Macao Bridge, due to be completed later this year, and other highways such as the proposed Shenzhen-Zhongshan Bridge, are all extremely helpful in facilitating the free flow of goods. Achieving the free flow of people is a bit more difficult as there are immigration requirements for entering and working in Hong Kong and Macao. There need to be more business-friendly visa measures to let professionals enter the two SARs. Sooner or later, people with the right skills in Hong Kong will find companies in the bay area could pay competitive wages and offer greater opportunities. Free flow of capital is trickiest at this stage since there are tight capital controls on the mainland. It would take some years before the yuan is freely exchangeable but gradual improvement is expected with the yuan’s exchangeability in coming years.
I am very optimistic that the Guangdong-Hong Kong-Macao Greater Bay Area will become another world-renowned bay area in the next decade or so. Better transport links, continued economic development, improved city infrastructure and the ability to attract more young and bright talent from across the country and the whole world will make the Greater Bay Area a globally competitive economic and technology powerhouse. It is now up to the government and people of Hong Kong to seize the great opportunity and create a bright future for our next generation.
The author is an executive member of the New People’s Party and a former civil servant.