The agreement between China and the United States to build a constructive relationship of strategic stability based on respect, fairness and reciprocity has become an important chapter in the course of history. The leaders of the two major countries reached an eight-point consensus, covering areas such as economics and trade, counter-narcotics, artificial intelligence, and people-to-people exchanges, among others, which marks a historic milestone.
Head-of-state diplomacy serves as a compass for bilateral relations, while a strong and steady motherland provides a solid anchor for Hong Kong’s stability, which enhances market confidence in and expectations for the special administrative region, and thus will bolster its economic and trade development. As a highly open and export-oriented economy, Hong Kong is inherently vulnerable to fluctuations in major global markets. The transition of Sino-US relations from volatility to strategic stability yields substantial dividends for the city, which can be analyzed across several dimensions.
Foremost among these is how macro-stability shields Hong Kong from geopolitical headwinds. Any friction between China and the US, the world’s two largest economies, sends ripples across the globe. The successful summit has effectively installed crucial safety guardrails for bilateral relations, benefiting the SAR in four distinct ways.
First, the strategic consensus and the establishment of guardrails will dispel the wait-and-see anxiety among international investors. By stabilizing market expectations, this development lays a secure foundation for Hong Kong’s economic recovery and growth.
Second, hostile external forces have long exploited Sino-US tensions to sensationalize Hong Kong affairs, smearing the SAR’s governance and inciting social discord to disrupt its development. With normalized communication mechanisms now in place between Beijing and Washington, bilateral frictions are expected to decrease significantly. This narrows the window for external actors to disrupt Hong Kong’s development by interfering in its internal affairs under various pretexts.
Third, the Western mainstream media have historically perpetuated negative narratives that distort the successful implementation of the “one country, two systems” framework, misleading the international community. The high-level communications allowed the Chinese side to clearly expound on the core concepts governing the SAR and highlight the restored social stability, robust rule of law and improved livelihoods following the enactment of national security laws. To a large extent, this is helpful in correcting misunderstandings of Hong Kong’s situation, and fostering a more objective, fair, and friendly global media environment for the city.
Fourth, the summit’s outcomes underscore the central government’s strong ability to uphold Hong Kong’s stability and interests. This profoundly boosts market confidence, which in turn will revitalize investment, consumption, and entrepreneurial dynamism, giving the city greater momentum in the future.
In addition to geopolitical buffering, revitalized trade ties are set to unlock new economic opportunities for Hong Kong. Prior to the summit, the two sides reached new arrangements, including establishing and advancing a Board of Trade and a bilateral investment board, setting up an agricultural working group, implementing reciprocal tariff reduction on about $30 billion worth of goods from each side, and extending the Kuala Lumpur economic and trade arrangement (a two-month extension of the tariffs suspension). After years of friction, bilateral economic and trade relations are gradually returning to a normal track, releasing four major dividends for Hong Kong’s economic recovery and industrial transformation.
First, the protracted trade dispute has placed immense pressure on Hong Kong’s entrepot trade, logistics, and exhibition sectors. As bilateral trade channels clear, the efficient flow of Sino-US goods through Hong Kong will directly revitalize its re-export trade, offshore commerce, and international conference and exhibition industries, injecting fresh vitality into the city’s external trade engine.
Second, the easing of bilateral investment restrictions allows US capital to leverage Hong Kong as a springboard into the Guangdong-Hong Kong-Macao Greater Bay Area. Simultaneously, Chinese mainland enterprises can utilize Hong Kong’s platform for going global, thus invigorating Hong Kong’s international financial center status.
Third, warming economic ties will boost demand for cross-border commercial arbitration, legal consulting, and financial and investment services. Hong Kong is perfectly positioned to capture this demand, catalyzing the expansion of local law and accounting firms, and consultancies, cementing the city’s edge as the Asia-Pacific hub for high-end professional services.
Fourth, Hong Kong’s economic structure has historically been overreliant on traditional sectors like finance and real estate. The gradual restoration of Sino-US cooperation in emerging fields such as the digital economy and the entertainment and creative industries offers Hong Kong new avenues for economic diversification and cultivation of new growth engines.
The head-of-state diplomacy is also conducive to a potential return of global multilateralism, which is a good thing for Hong Kong given its international role. As China and the US work together to maintain the orderly operation of multilateral economic and financial mechanisms, it would create a broader platform for Hong Kong to engage in high-level international affairs, allowing the city to participate more deeply in global rule-making, standard-setting, and commercial adjudication, significantly amplifying its institutional voice and industry influence on the world stage.
Anchored by a Sino-US consensus on cooperation, Hong Kong can fully play its role as a superconnector. By linking the robust industrial base of the Greater Bay Area with Western advanced technologies and global consumer markets, Hong Kong can help construct two-way cross-border supply chains, consolidating its strategic position as the core hub of the Asia-Pacific region. Ultimately, the consensus on stability reached by the two leaders sends an overwhelmingly positive signal to the world, fundamentally reshaping the international community’s expectations for and confidence in Hong Kong. This renewed optimism will accelerate the influx of multinational corporations, top-tier global talent, capital, and technology, comprehensively elevating Hong Kong’s global competitiveness.
The author is vice-chairman of the Committee on Liaison with Hong Kong, Macao, Taiwan and Overseas Chinese of the National Committee of the Chinese People’s Political Consultative Conference, and chairman of the Hong Kong New Era Development Thinktank.
The views do not necessarily reflect those of China Daily.
