Louis Chen says the city is set to write a new chapter in its journey to prosperity, fulfilling its role as superconnector and super value‑adder

Chief Executive John Lee Ka-chiu unveiled the Hong Kong Special Administrative Region’s first five‑year plan, alongside the 2026 Policy Address, on Wednesday. Marking the first medium- to long‑term development blueprint since Hong Kong’s return to the motherland in 1997, the document represents a landmark advancement in the modernization of the SAR’s governance system and governance capacity.

Milestone significance: three leaps in governance logic

First, governance shifts from annual policy cycles to medium- to long‑term strategic planning. Previously, the SAR administration operated on an annual basis, with policy continuity relying on the chief executive’s term of office. The 100‑plus‑page five‑year plan sets out 22 key indicators, distinguishing binding targets for mandatory delivery from indicative targets guiding market directions. It institutionalizes the full cycle of planning, implementation and performance review, embodying the principle of executive‑led governance and improved administrative efficiency.

Second, Hong Kong moves from aligning with national plans to synchronizing with them. In the past, Hong Kong participated in national development strategies mainly through special chapters and cooperation agreements. For the first time, Hong Kong has formulated its own five‑year framework, synchronized with the national 15th Five‑Year Plan (2026-30), enabling the SAR to integrate proactively into national development under the “one country, two systems” framework, and positioning itself as a superconnector and super value‑adder.

Third, policy statements evolve into measureable governance commitments. Among the 22 key indicators, binding targets include generating 900 hectares of serviced land in the Northern Metropolis, a 32.5 percent reduction in carbon intensity by 2030, 30  percent share of zero‑carbon power generation and improved environmental quality standards. Indicators such as reasonable real‑GDP growth, 100,000 nonlocal students and a HK$126‑billion ($16-billion) tourism‑sector value‑added output are indicative, respecting market forces. This mixed‑indicator framework turns the blueprint into a tangible governance contract between the government and society.

Core strategic priorities: three interlocking growth engines

First, the Northern Metropolis university towns drive integrated education‑technology‑talent development. Three university towns are planned at San Tin, Hung Shui Kiu and Ta Kwu Ling. Following the “five‑element model” covering education, technology, industry, talent and urban development, 300 hectares of educational land will expand to more than 1,000 hectares together with adjacent industrial sites. Hung Shui Kiu will start land allocation in 2026, with universities entering in 2027‑2028. San Tin will focus on medicine, life sciences, artificial intelligence, robotics and microelectronics, hosting a new medical school and affiliated teaching hospital. Supported by the “eight‑vertical and eight‑horizontal” transport network and new healthcare infrastructure, the Northern Metropolis is advancing from land reclamation to holistic city‑building, industrial cultivation and ecological development.

Second, “finance‑plus” and the renminbi ecosystem consolidate Hong Kong’s unique strengths. The plan strengthens Hong Kong’s role as the world’s largest offshore RMB hub, explores liquidity support mechanisms and RMB‑denominated government payments, and develops an RMB‑priced gold market. A licensing and regulatory regime for digital assets will be built under the principle of “same business, same risks, same rules”. The “finance‑plus” initiatives for innovation, trade and green development will upgrade Hong Kong from a traditional fundraising platform into a national financial infrastructure node with pricing and risk‑management capabilities.

Third, Guangdong-Hong Kong-Macao Greater Bay Area integration deepens through rule‑alignment. The blueprint promotes cross‑border computing infrastructure, large-scale AI computing clusters and 6G cooperation, and seeks extended land‑port operating hours. It advances the Closer Economic Partnership Arrangement to deliver national‑treatment access for Hong Kong service providers beyond the negative‑list framework, develops common standards for construction‑sector workers, and leverages Qianhai, Nansha and Hetao platforms. Shifting from physical connectivity to soft‑rule alignment, Hong Kong will deploy its common-law advantages to serve national priorities.

Key challenges and policy recommendations

External headwinds, cyclical funding constraints, effective indicator delivery and talent‑support matching constitute major practical challenges. To deliver on the blueprint, the SAR should establish an annual‑target list plus mid‑term review mechanism; enact dedicated legislation for Northern Metropolis governance; roll out project‑based rule‑alignment in the Greater Bay Area; and safeguard openness through robust rule‑of‑law and international dispute‑resolution arrangements.

Hong Kong’s first five‑year plan represents an upgrade in governance philosophy. Medium‑term strategies counter short‑term volatility; quantified indicators institutionalize accountability; rule‑alignment unlocks deeper regional integration. With consistent implementation, Hong Kong will write a new chapter in its new journey to prosperity, fulfilling its role as a superconnector and super value‑adder amid global transformations.

The author is a member of the Chinese Association of Hong Kong and Macao Studies and a member of the Election Committee of the Hong Kong Special Administrative Region.

The views do not necessarily reflect those of China Daily.