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RESOURCE CENTER

Press Release

2013 China Urban Competitiveness Report (Hong Kong)

2013.05.20

Press Conference of
2013 China Urban Competitiveness Report (Hong Kong)

Organizer
The Better Hong Kong Foundation

Co-organizers
Center for City and Competitiveness, The Chinese Academy of Social Sciences
Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong

(20 May 2013, Hong Kong) The Press Conference of 2013 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 20 May 2013. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2013 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni in The Chinese Academy of Social Sciences.

A new future in 2030: the world will face a higher risk of instability due to changes in the world’s politics, economy and science & technology, multi-polarization and dispersion of power, and conflicts on resources and the environment. At the same time, to build a well-off society in 2030, China must change the current unsustainable urbanization mode in order to address the prevailing economic, political, cultural, social and environmental problems, and better respond to the challenges of sustainability in these aspects.

Ideal city of sustainable competitiveness is the new goal of Chinese cities’ development. In view of this, the Project Team of Competitiveness of Chinese Cities has created the indicator of “urban sustainable competitiveness” and plans to carry out theoretical, empirical and case studies in the coming decade, aiming at the realization of sustainable development and enhancement of competitiveness among Chinese cities. The theme of this year’s report works on theoretical framework and assessment baseline.

In accordance with the new theoretical framework, competitiveness is divided into short-term one and long-term one, and named comprehensive economic competitiveness and sustainable competitiveness respectively in this report. 293 cities (including cities from Hong Kong, Macao and Taiwan) are ranked by the Comprehensive Economic Competitiveness Index, while 287 prefecture-level cities (including Hong Kong and Macao) are ranked by the Sustainable Competitiveness Index. For the latter one, key indicators applied are extracted from eight major areas of livable city, business friendly city, harmonious city, eco-city, knowledge-based city, urban-rural integrated city, info-city and cultural city.

The top ten cities in the Comprehensive Economic Competitiveness Index in 2012 are Hong Kong, Shenzhen, Shanghai, Taipei, Guangzhou, Beijing, Suzhou, Foshan, Tianjin and Macao. They are all coastal cities and the influence of location advantage to comprehensive economic competitiveness is obvious. In terms of administrative status of cities, Special Administrative Region, municipalities, vice-provincial cities, cities with independent planning and provincial capitals have stronger competitiveness.

The top ten cities in the Sustainable Competitiveness Index in 2012 are Hong Kong, Shanghai, Shenzhen, Beijing, Guangzhou, Macao, Hangzhou, Qingdao, Wuxi and Jinan. Similarly, coastal cities have the advantage.

A typical inverted U-shaped relationship is identified between the sustainable competitiveness and economic competitiveness, which indicates that the key to enhance the competitiveness of Chinese cities is not on the present comprehensive economic competitiveness, but rather how to raise the sustainable competitiveness and enhance the development potential of the Chinese cities, which can be regarded as the inherent requirement and inexhaustible power for transform Chinese mode of socio-economic development.

Specific recommendations are given according to the aforementioned eight major areas. The four basic measures suggested are the implementation of balanced economic and social development strategy, the integration of urban and rural municipal management system, the formulation of policy on sustainable urban development and the establishment of long-term mechanism on the enhancement of sustainable urban competitiveness.

Hong Kong keeps the top position in comprehensive economic competitiveness but the speed of growth is slowing down. The sub-index of overall efficiency competitiveness is 0.69968, ranked third after Taipei and Macao. Hong Kong has a significant advantage in GDP per unit of land, thanks to its dense population and commercial activities, a high degree of agglomeration, streamlined business regulations, a clean government, good supporting facilities and efficient services. However, the sub-index of overall incremental competitiveness is only 0.44534, ranked eighth after Taipei, Beijing, Guangzhou, Tianjin and Shenzhen etc. Hong Kong is suffering from the gradual weakening of the advantages in tax, talent, software and hardware facilities. Land shortage-induced high rents hinder the development of small and medium-sized enterprises. Hong Kong is also over-dependent on financial and real estate sectors and lacks stable sectors for growth.

Hong Kong also has a top position in sustainable competitiveness but is weak in the sub-index of knowledge-based city. Hong Kong is ranked first with the index of 0.98029. Among eight sub-indices, Hong Kong tops in cultural city, urban-rural integrated city, harmonious city, business friendly city and livable city, while second in eco-city and third in info-city. Its index in knowledge-based city is 0.83988 and is ranked fourth after Beijing, Shanghai and Shenzhen. Hong Kong’s R&D expenditure, in terms of the percentage of GDP, is much lower than the one in Japan, South Korea, Singapore and the Mainland. Hong Kong also lacks programs supporting science and technology development and incentive system for technological innovation, along with the weak atmosphere of innovation and ability of knowledge transfer. All these are the major problems in Hong Kong.

In addition to the insignificant transformation of the industrial structure towards innovation and technology, high dependence on the financial sector and real estate economically, rapid population aging and competition from global and the Mainland cities are the problems challenging Hong Kong’s sustainable development. The Project Team makes recommendations on the future development of Hong Kong in three aspects. First, the HKSAR Government should adjust its policy approach by developing long-term development planning on land policy, development of pillar and new industries, population policy and talent development. Second, to re-position Hong Kong according to the latest situation of the Chinese economy and to play its unique role and influence. Specifically, Hong Kong can enhance the cooperation of its enterprises with their mainland counterparts following the national policies on economic restructuring and “going-out” strategy. By participating in the development of an innovative country and the Greater Pearl River Delta economic circle, the people of Hong Kong can better understand the importance of regional cooperation towards regional prosperity and stability. Infrastructure can be better connected and exchanges and cooperation between the civil society and government can also be strengthened. Third, to promote scientific and technological innovation, and lead to the development of the knowledge-based economy by participating in the development of the "Shenzhen-Hong Kong Innovation Circle", the construction of the Asian intellectual property rights trading and service centre, the construction of overseas R & D and design centre of Mainland enterprises, and the implementation of "going-out" and "bringing-in" policies.

Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “Hong Kong is a developed city and the overall performances on various areas are satisfactory. However, the financial crisis is still deepening, and the world economy is facing downturn while the international trade protectionism is arising. Nevertheless, the Asia-pacific region maintains a relatively rapid growth and China becomes the driving force for development. Urbanisation in the Mainland China is fast and with improvements. Hong Kong should assess the environment carefully so as to map out long-term strategies and short-term measures to cope with global changes as well as to seize every opportunity.”

For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org.