The development of the Greater Bay Area has continued to attract wide attention since the release of the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area (“Outline”). The Hong Kong business community should keep abreast of the changes arising from the increasingly closer interconnections in the Greater Bay Area in order to stay up-to-date on the latest happenings there.
The release of the Outline marked the beginning of a new era of Guangdong-Hong Kong- Macao cooperation. Wang Chunxin, Head of Hong Kong Economic and Policy Research Division at the Bank of China (Hong Kong), believes that the “14th Five-Year” Plan has brought new opportunities for the Guangdong-Hong Kong-Macao Greater Bay Area, and Hong Kong, being a part of the Greater Bay Area, has a new positioning.
Hong Kong’s new positioning
Wang pointed out that high-quality development is one of the key milestones of the “14th Five-Year” Plan. He noted that high-quality development is very wide-ranging in its coverage, of which innovationdriven development is the primary feature and the key driving force for industrial transformation. In this regard, the country is determined to transform into a high-quality economy and strive to build an international technology innovation centre.
Hong Kong’s basic research in the upstream innovation and technology (I.T.) industries has already reached world-class standards. Wang believes that it should better allocate resources going forward to help build the international technology centre and drive the Mainland’s technology innovation industries to develop in depth and in breadth.
Facilitate domestic demand and help further opening-up
In this context, Wang said that the Greater Bay Area could act as a facilitator of domestic demand in tandem with the “domestic circulation” strategy. He expected that under the leading policy of “domestic circulation”, the momentum of the Mainland’s economic growth will further shift from external-demanddriven to domestic-demanddriven, with a rapid expansion of domestic demand and continuous consumption upgrade. Therefore, in the future, the Greater Bay Area can help the Mainland further expand domestic demand and capture a part of this most promising market by boosting the domestic sales of Hong Kong enterprises’ superior products and expanding import distribution operations.
The “14th Five-Year” Plan and the Long-Range Objectives Through the Year 2035 has put forward a number of measures such as those for promoting trade and investment liberalization and facilitation in the next five years. Wang noted that Hong Kong can provide the best model for establishing a new trade and investment system, and as one of the Mainland’s main channels for imports, it is set to get more business opportunities as the Mainland further opens up to the rest of the world. The Greater Bay Area can also leverage its own strengths in infrastructure and capacity expansion to help the Mainland enhance its level of opening-up.
Wang stressed that developing green finance is a top priority as the demand for green finance grows in China and the rest of Asia. Since Hong Kong is uniquely equipped to develop green bonds and green finance in the Mainland, it is set to become a pioneer in green finance in the Greater Bay Area and promote green financial cooperation among the Greater Bay Area cities.
Greater Bay Area has very promising prospects
Looking ahead, Wang is very optimistic about the prospects for the Greater Bay Area. He said that the Greater Bay Area will fully leverage its overall strengths to catch up with the world’s top bay areas in the future. The Greater Bay Area’s economic aggregate is estimated to reach USD2.5 trillion by 2025, making it the world’s largest bay area economy. Its GDP aggregate is likely to exceed USD5 trillion 20 years later and may even surpass that of the ten ASEAN countries combined. Wang said that Hong Kong and Shenzhen will be the real core and engines of the Greater Bay Area as they are unrivalled among the Greater Bay Area cities in terms of level of financial development and strengths of science and technology industries.
In Wang’s view, Hong Kong can only turn the tide if there is a major breakthrough in the I.T. industries. He believes that as the financial sector is Hong Kong’s most promising sector, while supporting Hong Kong’s economic growth, it can seize the opportunity to further upgrade to world-class standards and make a greater contribution to the country’s transformation into a financial powerhouse.