24 July 2018
Forge Bay Area to Spearhead China’s Economic Opening-up
By Dr Jonathan Choi, Chairman, CGCC
The 19th National Congress explicitly supports the integration of Hong Kong and Macao into the overall national development, with focus on developing the Guangdong-Hong Kong-Macao Bay Area. President Xi Jinping even visited Hong Kong last year and witnessed the signing of the Framework Agreement on Deepening Guangdong-Hong Kong-Macao Cooperation in the Development of the Bay Area between the NDRC and the governments of the three places. This fully shows that the Central Government attaches great importance to the future development of the three places.
As an international financial and business center, Hong Kong can play a key role in the specific plans for the Bay Area. This year, I made a number of proposals to the CPPCC on how to make the best use of Hong Kong’s strengths to develop the Bay Area into an important hub for the country’s sustained and diversified economic development.
Develop LMC Corridor
The governments of Hong Kong and Shenzhen have inked a deal to jointly develop the Lok Ma Chau Loop (the “LMC Loop”) into an innovation and technology (I&T) park. Located at the border between the two places, the park is an important base for I&T development in the Bay Area. I suggested including some areas along Shenzhen River’s banks adjacent to the LMC Loop and transform the Futian Bonded Zone into a logistics and incubation base for technology industries to further expand the LMC Loop to form an innovation corridor, developing the Bay Area into a national I&T, R&D and application center.
Hong Kong and Shenzhen can consider setting up an administration bureau to formulate specific division of work in the LMC Loop, introduce arrangements to facilitate movement of technology and authorized personnel in and out of the area, cancel restrictions on cross-border research funding and exempt customs duties on imported scientific research equipment in order to lay a good foundation for I&T development in the Bay Area.
Support development of free-trade ports
The 19th National Congress report also mentioned considering developing free-trade ports. As a special economic zone with the world’s highest standard, Hong Kong’s strengths can be an important reference for the development of free trade ports in the Bay Area. The Central Government can explore using Hong Kong as a blueprint to support the upgrading of the Qianhai, Nansha and Hengqin free trade areas into free trade ports, strengthen the free flows of foreign trade, funds and talents including those from Hong Kong and Macao so as to facilitate the presence of talented people from Hong Kong and the rest of the world, and consider emulating Hong Kong in terms of tax structure and preferential treatment.
The authorities can also explore setting up onshore and offshore RMB centers in the Qianhai and Nansha free trade ports and work together with Hong Kong to broaden the two-way offshore RMB channel to attract more mainstream and emerging financial institutions from Hong Kong. For trade facilitation, policy arrangements can be made for exemption of import and export tariffs, and to attract more domestic and foreign enterprises, provide a convenient, standardized and efficient management system and business environment, and in particular support Hong Kong businesses in getting national treatment to access the relevant markets.
State-level leader to oversee development
To effectively implement the Bay Area’s development plan and enable it to play a key role in national economic development, it is necessary for the Central Government to formally incorporate it into its national development strategy. Since Guangdong, Hong Kong and Macao have different social and economic systems and are independent customs duty zones, and their key government officials are very highly ranked, it is better for the Central Government to set up a coordinating committee for the Bay Area. The committee should be headed by a state-level senior leader to supervise the implementation of the overall development plan. It should also coordinate with the NDRC, the relevant central ministries and the governments of the three places for research decisions on major cooperation issues and coordinate specific implementation tasks for integration among the cities in order to avoid duplication.
In fact, CGCC and Hong Kong’s industrial and business community earnestly look forward to the implementation of the Bay Area’s development plan, which will provide enormous new opportunities for Hong Kong businesses. We will actively facilitate stronger ties among entrepreneurs, chambers of commerce and industrial and business groups of the three places through a business cooperation platform, explore how to assist businesses to more effectively participate in the Bay Area’s development, and maintain close contact with relevant government departments to pass on the feedback of the business community, providing businesses with broad support in capturing opportunities in the area.
This article was first published in the magazine CGCC Vision March 2018 issue. Please click to read the full article.