Hong Kong, a highly open and international city in the Guangdong-Hong Kong-Macao Greater Bay Area (GBA thereafter), is an international financial, shipping, trade center, and aviation hub. Its professional services are world-renowned. Coupled with the dual advantages of “one country, two systems,” Hong Kong plays a vital role in the development of the GBA.
A few days ago, Chief Executive Lee Ka-chiu and Hong Kong Special Administrative Region (HKSAR thereafter) representatives had close exchanges with the mainland. During a symposium with National People’s Congress representatives in Hong Kong, Lee Ka-chiu remarked, “Hong Kong has fully opened up with the mainland and reconnected with the world.” Hong Kong is now poised to integrate into the national development strategy and contribute greatly to the high-quality development of the Greater Bay Area.
Recently, the HKSAR government announced the 2023/2024 fiscal budget plan, predicting that Hong Kong’s economy will rebound significantly in 2023, with a real annual growth rate between 3.5% and 5.5%. Hong Kong, a central GBA city, is one of China’s most developed and highly-open cities. At the beginning of the new year, Hong Kong’s exchange with the mainland and the world has fast returned to normal, and the overall economic climate has also improved. As the national economy moves towards high-quality development and maintains reasonable growth, other emerging economies in the Asian region will also continue to experience rapid growth, presenting many opportunities for Hong Kong's future development.
Huge Potential in the GBA Boosts Vast Development in Hong Kong
The future of Hong Kong should be discussed in the context of the integrated development of the GBA. With access to scientific and technological innovation resources, policy conditions, and internationalized rules for free trade ports across the three regions, the GBA has demonstrated strong international competitiveness in the fields of technology innovation and manufacturing, with enormous potential for future development. As the central city, Hong Kong is well-positioned to achieve new heights. On the one hand, the world’s three major bay areas strive to transform and seek technological innovation breakthroughs. The GBA is also actively seeking innovation breakthroughs through coordinated development. On the other hand, on the first day after the Chinese Spring Festival, the provincial high-quality development conference was held in Guangdong, demonstrating the determination of reform and development and bringing many supportive policies. At the same time, with the adjustment of clearance policies, exchange and interaction between Hong Kong and the mainland are gradually resuming, enhancing the synergy and accelerating the pace of coordinated development in the GBA.
When we examine the world's major bay areas, we can identify several shared traits. They all share a common goal of fostering a market-oriented, rule-of-law, and international environment that integrates the regional economy, knowledge, and regulations. This creates a magnet for capital, technology, and talent, thereby drawing in factors of production and promoting complete integration of the region's competitive industries into the global production chain. This strategy sustains the continuous upgrading of the regional economy and technology.
Hong Kong can be integrated into the tide of high-quality development in the Mainland by promoting integrated development in the GBA. Hong Kong can leverage this trend by creating three platforms: science-education (basic research), technology-innovation (manufacturing), and internationalized rules. On this basis, the GBA is gradually becoming a first-class bay area and world-class urban agglomeration suitable for living, working, and tourism.
Leveraging its Unique Position and Advantages to Support the GBA’s High-Quality Development
Hong Kong has five universities, including the University of Hong Kong, Chinese University of Hong Kong, and Hong Kong University of Science and Technology, that rank in the top 100 QS World University Rankings and possess a solid foundation in scientific research. In the past few years, these universities and scientific research institutions have been expanding northward and settling in major cities like Shenzhen, Dongguan, and Guangzhou. They are forming a collaborative development model for the technology industry known as "Hong Kong-Macau universities scientific research—Pearl River Delta application." Simultaneously, Shenzhen has become a hub for a multitude of high-tech enterprises, with its global reputation for exceptional technology research and development capabilities and technology transfer proficiency. In addition, the GBA has a sound industrial system and complete industrial chain, with a manufacturing base, international shipping and trade foundation, and an international financial platform that provides support and services to enterprises. The GBA presents a complementary and mutually beneficial industrial pattern, with advanced manufacturing and modern service industries promoting each other and developing synergistically.
Innovation is the core driving force to achieve high-quality development. The GBA has established several high-level open cooperation platforms in Guangdong-Hong Kong cooperation in such cities as Qianhai in Shenzhen and Nansha in Guangzhou, which play a critical role in deepening reforms, expanding openness, and serving as pilot zones. These platforms not only achieved significant cooperation in many fields, such as infrastructure, investment and trade, financial services, and research and development, promoting the adoption of technology, capital inflow, and talent circulation. Meanwhile, Hong Kong is building its own Shenzhen-Hong Kong cooperation docking platform. Hong Kong also proposes the Northern Metropolitan construction plan to accelerate the integration of Shenzhen and Hong Kong's technological innovation to better connect with the mainland’s technological innovation system and create an “international innovation and technology new city.”
Promoting the integrated development of the GBA needs institutional openness that explores and innovates the integration of systems and mechanisms in the region. The 20th National Congress Report of the Chinese Communist Party (CCP) emphasizes the need to “steadily expand the opening up of rules, regulations, management, and standards.” Hong Kong’s regulatory systems are fundamentally aligned with international standards. As such, other cities in the GBA can learn from Hong Kong and establish a common regulatory system that aligns with the international community. The harmonization of regulations among the three regions will quickly promote the low-cost, efficient, convenient, and free flow of production factors such as talent, capital, technology, information, and labor, accelerating the construction of a unified market and enhancing the level of market integration in the GBA. Establishing a more open and internationalized GBA and creating a stable, fair, transparent, and predictable development environment will stabilize development confidence and market expectations and unleash immense economic growth potential, transformation, and momentum, continuously promoting high-quality development.
In recent years, Guangdong Province has enhanced the management system for using economic research funds transiting Hong Kong and Macao. The Guangdong Provincial Natural Science Foundation and significant provincial basic and applied basic research projects have been opened in Hong Kong and Macao. Guangdong Province has accelerated the opening of substantial scientific research infrastructure in Hong Kong and Macao. The National Supercomputing Guangzhou Center’s Hong Kong-Macao network serves more than 200 users from these regions. Ten laboratories in Guangdong Province and 20 Guangdong-Hong Kong-Macao joint laboratories are operating effectively, attracting many Hong Kong and Macao scientific research institutions and scientists. Measures like equal access to employment and entrepreneurship support policies and services have made talent flow in the GBA more efficient. At the same time, Hong Kong has announced that graduates from GBA-area institutions, such as the Chinese University of Hong Kong, Shenzhen, can apply for employment in Hong Kong after graduation. This will also significantly promote talent interaction and integrate development between the two places, injecting impetus into the collaborative innovation of science and technology.
It is particularly worth mentioning that the new process of financial opening up in the GBA is fostered by the joint issue of “Opinions on Financial Support for the Comprehensive Deepening of Reform and Opening Up in the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone,” launched by the People’s Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and the Government of Guangdong Province. The financial opening is undoubtedly the most potent driving force for the development of the Greater Bay Area because both basic scientific research and technology application require adequate financial support. Relying on Hong Kong's international financial center and Shenzhen's "dual-zone overlay" advantage, cooperatively innovating and developing the financial industry and releasing the “multiplier effect” of finance which is essential to supporting China's economic development, achieving a high level of openness, and maintaining financial security and stability. It is also necessary for the context of intense global financial market competition and changing economic patterns. The GBA can explore a financial dual-center system. On the one hand, the Shanghai-centred finance system serves the real economy in the mainland; on the other hand, the Hong Kong-centred international financial system can compete with Wall Street. In this regard, Hong Kong can play a key role, seizing the opportunity together to build the third pole of the International Financial Center.
Nowadays, the implementation of the HKSAR National Security Law has created a stable social environment for Hong Kong. Educational reforms and policies to support Hong Kong youth entrepreneurship and employment have laid the foundation for developing the next generation and their commitment to the motherland. “This is a perfect combination of the right time, right place, and people's unity, with everything ready and Hong Kong's development and opportunities being boundless and inspiring,” said Lee Ka-chiu, HKSAR Chief Executive. Hong Kong is moving forward on the fast track of full normalization. The author believes this is also the Hong Kong people’s common aspiration. With the full support of the Mainland and the hard work of Hong Kong people, Hong Kong will surely embrace a bright tomorrow.
Professor, The Chinese University of Hong Kong, Shenzhen
President, The Institute for International Affairs, Qianhai
Professor Zheng is Editor of The Asian Review of Political Economy (Springer-Nature), Editor of China Policy Series (Routledge), and Co-editor of Contemporary China Studies Series (World Scientific).
Professor Zheng’s main research interests are international relations, China’s foreign policy, Sino-US relations, China’s domestic transformation and its external relations. He has authored and edited some one hundred books, including ten monographs in English. He has published numerous research papers in academic journals.
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