The release of the Outline Development Plan for the Greater Bay Area earlier this year ushered in a new era of cooperation for the region. Guangdong Province, and particularly the cities of Guangzhou and Shenzhen, will be increasingly important partners for Hong Kong businesses as the initiative takes shape.
To learn more about the latest developments in this vibrant and prosperous province, Chamber Chairman Aron Harilela led a high-level business delegation to Guangdong on 23 May to meet Guangdong Vice Governor Ouyang Weimin, Guangzhou Mayor Wen Guohui and Shenzhen Vice Mayor Wang Lixin, as well as other senior officials.
Hong Kong has witnessed Guangdong’s progress and breakthroughs in recent years. Now that the Development Plan has been launched, the Hong Kong business community believes that Guangdong will only see more rapid and robust growth.
“With the recent launch of the Development Plan, this mission could not have been timelier,” said Harilela. “Hong Kong already has strong business and cultural ties with Guangdong, and the GBA is opening up many new opportunities. The productive meetings we had on this mission confirmed the tremendous potential of the region.”
The mission’s first stop was Shenzhen, where delegates met with Shenzhen Vice Mayor Wang Lixin. The story of the city’s role as a key driver of the Mainland’s export-driven transformation, and its position today as a world leader in advanced technology, is well known. The city continues to be in the forefront of the nation’s development.
Wang briefed members on the latest projects and policies, and also reminded them of the city’s remarkable achievements over the years. He noted that Shenzhen’s GDP has grown 10,000-fold since 1979 — an astonishing figure that brings home the success of the Mainland’s reform and opening up process.
Hong Kong and Shenzhen have complementary strengths that mean the two cities are perfectly placed to work together even more closely. On innovation and technology, Hong Kong possesses world-class research capabilities and first-class universities, along with a sound judicial and intellectual property protection system as well as an international business environment. Shenzhen, on the other hand, is a national innovation city with great achievements in scientific research that translates into strong and advanced manufacturing capabilities.
“Shenzhen is our closest neighbour and many Hong Kong companies have benefited from its transformation over the past few decades,” said Chamber CEO Shirley Yuen. “This cooperation is only set to deepen. The clearly defined roles laid out in the GBA Development Plan mean that both cities can focus on our respective strengths to create a more efficient and effective partnership.”
Enhanced cross-border cooperation is essential to ensure both sides benefit from the GBA initiative, and at a meeting in Guangzhou, Guangdong Vice Governor Ouyang Weimin discussed with the Chamber delegates how this could be achieved.
People flow is a crucial element, and the Vice Governor said that Guangdong wants to encourage more Hong Kong people to work in the province. He pointed out that this is being facilitated by a policy introduced last year that means Hong Kong people no longer need permits to work in Mainland China.
Ouyang also informed the delegates that Hong Kong accounted for some 60% of total inbound investment to the province, and that Hong Kong remains the largest trading partner of Guangdong, compared to other provinces and cities in China.
Guangzhou is an increasingly important player in the technology sector, and this has been regognised by the authorities in their GBA plans. The Development Plan emphasized that cooperation in innovation and technology will be strengthened, and that the development of the “Guangzhou-Shenzhen-Hong Kong-Macao” innovation and technology corridor will be pursued.
The delegation learned more about this technology development and other changes during a meeting with Guangzhou Mayor Wen Guohui. Like Ouyang, Wen emphasized that the region is becoming increasingly open for foreign businesspeople and companies, including those from Hong Kong. He noted that the city is seeing continuing growth in the number of overseas workers, and told the delegates that around 30,000 foreign-owned businesses operate in Guangzhou.
Wen also discussed Guangzhou’s focus on green and sustainable development. Already the city is a global leader in electric vehicles, with some 12,000 electric buses in operation. To support this fleet, Shenzhen has around 4,000 charging stations, and plans to increase this to around 100,000 in the next few years.
This is just the beginning, and the city intends the switch to electric to also include taxis and municipal service vehicles. To encourage the private sector to follow the electric path, the local government has introduced incentives including green financing, subsidies, and rewards for reduced emissions.
“Visiting these two dynamic cities has left us in no doubt that the Greater Bay Area is the place to be for business opportunities across a range of sectors,” said Harilela.
“The officials we met made it clear that they welcome the contribution of Hong Kong’s expertise as the GBA develops. We now need to make sure that we continue to work together and leverage our individual strengths for the best outcome for all.”
The Chamber delegation also had the opportunity to visit some of Guangdong’s technology businesses to see for themselves advances in the province’s industrial development.
Kingdee, one of Shenzhen’s many home-grown success stories, founded in 1993, has served around 6.8 million clients to date, including government departments and private companies. Members learned how Kingdee’s corporate management software and cloud services are helping enterprises to improve their operating efficiency and deliver better customer service.
ZTE is another Shenzhen name that needs little introduction. The telecoms company has expanded globally and has a presence in markets including Brazil, Germany, India and Australia. It is also in the vanguard of the development of 5G mobile technology.
Besides being much faster than 4G services, 5G is expected to also hasten the development of the Internet of Things as it allows for greater connectivity.
They also viewed some of the next generation of home entertainment systems, which use 5G and virtual reality. This enables people viewing a football game at home, for example, to feel like they are watching it live in the stadium.
“China is making major strides in 5G development,” said mission Deputy Leader PC Yu. “When this technology is rolled out, it will deliver improvements to how we live and work. It was great to learn more about how the innovations being created here in the Greater Bay Area will contribute to better business efficiency in the very near future.”
In Guangzhou, the delegation visited 4K Garden Technology, which operates a video production and distribution platform for ultra-high-definition 4K screens, and other immersive video experiences.
During the visit, members learned about the company’s current 4K production and distribution for television programmes and concerts, among others. Staff introduced the company’s 8K video technology and demonstrated the difference between 4K and 8K. Members also had their opportunity to shoot their own 4K video during the visit.
After a dinner in Guangzhou, the visit was rounded off for the delegates with a return journey by high-speed rail back to Hong Kong.
“This mission showed that is now perfectly possible to do a multi-stop visit to Guangdong Province – including a packed schedules of meetings and a relaxing dinner – and still be back in Hong Kong at a reasonable hour,” said Harilela.
History and Future of Cooperation
Guangdong has long been a prime destination for Hong Kong companies and individuals to invest and start businesses in the Mainland. Between 1979 and 2016, the aggregate amount of investment by Hong Kong in Guangdong reached nearly HK$2 trillion, accounting for 64% of the total amount of foreign investment in the entire province.
In 2017, the total imports and exports to and from Guangdong and Hong Kong amounted to 1.16 trillion RMB, accounting for 17% of that of the whole province, higher than that of Guangdong with other provinces or cities.
In recent years, investments from Hong Kong businesses in Guangdong have become more diversified, extending to the services sector from the manufacturing sector. A number of Hong Kong brands have already established a presence in the retail market in Guangdong.
As a highly open and international city, Hong Kong can share its international experience with Guangdong and help attract foreign investment, work with Guangdong enterprises to open up overseas markets, explore new opportunities and facilitate Guangdong’s economic development.
Serving as advisors to the mission were Liu Yajun, Deputy Director-General of the Economic Affairs Department, Head of Commercial Office; and Zhang Qiang, Deputy Director-General, Coordination Department, both from the Liaison Office of the Central People’s Government in the HKSAR; and Sidney Chan, Director of the Hong Kong Economic and Trade Office in Guangdong.