Hong Kong Urged to Seize the Twin Opportunities in the Pan-Pearl River Delta and China’s Western Development

The signing of the Pan-PRD Regional Co-operation Framework Agreement as well as the recent Hong Kong and Guangdong Co-operation Joint Conference have signified a new phrase of an even deeper economic integration between Hong Kong and the mainland.  Mr. George Yuen, the Chief Executive of the Better Hong Kong Foundation said at a press briefing co-organised by the Better Hong Kong Foundation and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong, “As Hong Kong and China have become closer than ever, the future of Hong Kong would have a stronger strategic partnership with its neighbouring economies as well as its greater reliance on the economic development in the mainland. Therefore, those opportunities arising from two national development strategies, the Pan-PRD Regional Co-operation and the ‘Going West’ are something we have to make the best use.”

Two months ago, an innovative and landmark regional cooperative development framework focused on the Pearl River Basin and the area to the south of the Yangzi River was formally established.  Leaders from nine provinces led by Guangdong, namely, Guangdong, Guangxi, Yunnan, Guizhou, Sichuan, Hunan, Jiangxi, Fujian and Hainan Dao, plus Hong Kong and Macau, briefly known as ‘9+2’, met to promote a new cooperative framework that would capitalize on their respective strengths to accelerate development.  This is an innovative development framework that will have long-lasting impacts on China and its people.

Professor Yeung Yue-man, Director of the Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong, and Chairman of the Panel on PRD, Central Policy Unit remarked: “The Pan-Pearl River Delta (Pan-PRD), consisting of about one-fifth of China’s land, one-third of its population, one-third of its GDP and half of its foreign investment, is an important part of China.  For more than two decades, Guangdong (especially the PRD) and Fujian have experienced exceptionally rapid growth in an era of reform and openness, with Hong Kong and Macau providing the catalyst.  Their positive and revolutionary change has astounded the world.  The Pan-PRD framework is intended to extend this development trend to the neighbouring territories, bringing with it modernization, industralization and professionalization.  In this development design, the special and advanced roles of Hong Kong and Macau figure prominently.”

During the past year, Hong Kong has benefited from new policies relating to CEPA and the individual tourist travel scheme.  This has brought about a healthy economic recovery, as reflected by price increases in the property and stock markets.  With the birth of the Pan-PRD, the future of Hong Kong looks more rosy.  In fact, if the opportunities brought about by the Pan-PRD can be fully harnessed, it is not far-fetched to imagine Hong Kong will begin another cycle of growth.  The question is, how should Hong Kong manage its change and where to begin?

Professor Yeung commented, “From all indications, ‘looking west’ seems to be a more rational choice.  In the first place, after two decades of development, the imbalance in the level of development between the two wings of the PRD has surfaced.  More actively developing the western wing area will not only bring out the potential and advantages of the five prefecture-level cities of Zhaoqing, Foshan, Jiangmen, Zhongshan and Zhuhai, but also the pressure that has been brought to bear on Dongguan and Shenzhen arising from the lack of developable land and rising land and labour costs, will ameliorate.  The continued improvement in infrastructure in the western wing, together with the soon-to-be-announced construction of the Hong Kong-Zhuhai-Macau Bridge, will add new dynamism in propelling this area forward.”

The western wing of the PRD is territorially contiguous with Guangxi, Yunnan, Guizhou and Sichuan.  These four provinces in the southwest are rich in natural resources, people, minority groups, water and mineral resources.  They are obviously complementary with Guangdong, Hong Kong and Macau in development.  In the cooperative framework that is being designed in the Pan-PRD, this large part of China’s southwest can, through the advantages of Hong Kong’s financial centre, logistics, communication and tourism, help it export its commodities to the world market.  As well, Hong Kong can lend its development experience to elevate the level of professional service and modernization in these provinces.

Apart from being part of the Pan-PRD cooperative framework, China’s four southwestern provinces constitute an important part of China’s Western Region Development Strategy promulgated in 1999.  The four provinces in fact form part of six provinces in the grand design of the southwestern wing of the western region.  Within the four provinces in question is concentrated a large proportion of China’s southwestern cities, economic development, talent and scientific ability.  Although they have witnessed creditable development over the past years, the Pan-PRD new policy initiative means that they are under the double advantage of two sets of favourable policies.  They can be likened to have boarded an economic super-express train poised for even more rapid progress.  In general, Hong Kong can seek complementary development with the western region.  However, the Hong Kong impact has not been widely felt to date.  There is much room for Hong Kong government and investors to double their efforts, so that Hong Kong’s strengths can be highlighted and opportunities inherent in the new policies fully seized.  Furthermore, since Yunnan and Guangxi share land boundaries with Southeast Asian countries, they are certain to play vital roles in China’s continuing efforts to develop free trade with ASEAN countries in the ‘10+1’ framework.

Professor Yeung concluded by asserting: “The above analysis is purported to highlight the fact that, with the emergence of the Pan-PRD, Hong Kong now stands at a crossroads.  ‘Going west’ appears to have many tempting factors, including the recent efforts by governments concerned to speed up development in the western wing of the PRD and the double policy benefits that will give a boost to the four provinces in China’s southwest.  All this will create conditions for more advantages mutually attainable for Hong Kong’s entrepreneurs, investors and the public at large.  From this standpoint, for Hong Kong government and investors to ‘look west’, it is incumbent on them to begin the process of learning and getting to know this part of China.  They need to better prepare themselves before deciding on their strategy of development, investment, cooperation and exchange.  Ultimately, Hong Kong should step up its efforts for welcoming a bright future that the Pan-PRD regional framework will bring.”

For enquires, please contact Ms. Elsie Leung of the Better Hong Kong Foundation at 2865-3529.

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The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional financial, shipping, trading, communications and technology center.  The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.