Leading Academics Optimistic on Hong Kong’s Long Term Development

Hong Kong should focus more on the investment in its human capital and attract talent from mainland China to meet the needs of Hong Kong’s economic transformation if it is to remain competitive in the long run, according to five leading academics from various Hong Kong universities.

These scholars presented and discussed their thoughts today at a “Symposium on Hong Kong’s Long Term Development”, organized by the Better Hong Kong Foundation and the Hong Kong Centre for Economic Research. The symposium, part of the “Hong Kong Together” Campaign, sought to analyse both the challenges and opportunities that the people of Hong Kong face as they seek to maintain Hong Kong’s competitive edge vis-a-vis the current economic hardships.

While presenting his viewpoint on “Hong Kong’s Competitive Advantages”, Professor Michael Enright of the School of Business at the University of Hong Kong pointed out that Hong Kong’s knowledge-intensive services and activities have been the main reason behind its prosperity over the last two decades. Based on this premise, he observed that “if Hong Kong is to become a true international centre like New York or London, it will need to tailor its education and training systems to develop the workforce necessary to reinforce its position as a management, co-ordination, and financial centre.

“It will need to ensure that the quality of life and physical environment can attract highly mobile knowledge workers,” Professor Enright continued.

Professor Y.C. Richard Wong, Director at the School of Business at the University of Hong Kong, emphasized that the confidence of the Hong Kong people is key to our economic recovery. Commenting on the vulnerability of the economies of the Asian countries, Professor Wong said that Hong Kong’s currency remained stable “largely because of its currency board system, the relative transparency of its monetary and banking system, and the fact that the people of Hong Kong did not lose confidence in their government and its promise to maintain the value of the currency. As long as the public maintains this confidence, mere speculation can have little impact, especially in a currency-board system like Hong Kong’s.”

Professor Liu Pak Wai, from the Department of Economics and also Pro-Vice-Chancellor of the Chinese University of Hong Kong, urged that Hong Kong should look for new high value-added activities to sustain the current high wages. These include continued development in the financial services sector as well as in innovation and technology. To achieve these goals, Professor Liu said, “If we have to climb the value-added ladder to be on a par with New York and London, we have to attract global talent-the best human resources from all over the world.” As a start, Professor Liu suggested that Hong Kong should capitalize on talent from mainland China. In this regard, the SAR Government may have to adjust its immigration policy accordingly.

Advising on Hong Kong’s competitiveness, Mr. Ronnie Chan, Trustee of the Better Hong Kong Foundation, said Hong Kong should strengthen three industries critical to its economy, including financial services, tourism and manufacturing, all of which contribute significantly to the vitality of Hong Kong’s economy. At the same time, Mr Chan added, “We should go higher value-added in many of our activities. The commercialisation of high technologies can be one example.”

Professor Sung Yun Wing, Chairman and Professor of Economics of the Chinese University of Hong Kong, stressed that among the Asian economies, viable and sound banking and financial systems are rare, yet Hong Kong’s is still transparent and stable. “The Asian financial crisis underlines the strength of Hong Kong’s role both as an international financial centre and as the gateway to mainland China, which other cities cannot easily substitute,” he said.

Elaborating on his renowned Theory of Comparative Institutional Advantage, Professor Fan Yiu Kwan, Dean of the School of Business of the Hong Kong Baptist University, said, “Hong Kong’s comparative advantage lies in our formal and informal institutions when compared to cities such as Shanghai and Singapore. When the formal institutions have been fully developed, specialisation among the three cities will be determined by geographical factors and their informal institutions.”

In closing, Mr. George Yuen said, “I am encouraged to hear the outlook of these esteemed professors. Although the economic crisis may be making it difficult for many of us now, the people of Hong Kong should have confidence in its resilience and ability to overcome adversity. The presentations today epitomize the reason why we have launched the “Hong Kong Together” Campaign. The goal of the campaign is for the people of Hong Kong to realize that if we come together and support our unique and exciting city, we can truly make a difference in turning the tide of the current economic difficulties.”

 

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“Hong Kong Together” is a community-led confidence building campaign aimed at uniting various sectors of our community and motivating Hong Kong people to work together to instill public confidence. This initiative encourages public togetherness as well as engenders much-valued civic spirit in the community. The Better Hong Kong Foundation together with representatives from various participating sectors in the community form the Joint Working Committee steering the Campaign.