On 1 July, President Xi Jinping led the celebrations to mark 25 years since the establishment of the Hong Kong Special Administrative Region.
On the same date, John Lee took over the reins as Chief Executive of the HKSAR from Carrie Lam. The new Administration comes to power at a challenging time for Hong Kong. However, history tells us that we have endured economic shocks and health crises in the past, and always bounced back stronger than ever.
Throughout the past quarter-century, the city has been buffeted by once-in-a-lifetime storms, not least the Asian Financial Crisis, riots and pandemics. But during the same time period, we also enjoyed many years of economic growth and development.
Businesses are ready to help Hong Kong take off again to write the next chapter in our history. In particular, Hong Kong companies are keen to make the most of the opportunities emerging amid the development of the Greater Bay Area (GBA), as well as the Belt and Road Initiative and beyond. We look forward to reigniting our global connections and working together towards a bright and prosperous future.
To find out more about the outlook for different sectors, The Bulletin asked members of our General Committee to share their thoughts: following is a snapshot of their responses.
Creating a Cleaner, Greener Hong Kong
Looking back at Hong Kong's development over the past 25 years, a major trend has been the move towards sustainability. Today, with the risk from climate change becoming ever more apparent, all businesses must reduce their environmental impact.
At the time of the establishment of the Hong Kong SAR, air pollution was a major problem for the city. This situation is much better today, and I'm pleased to say that the Chamber played its part in improving the air quality for residents. We carried out a number of campaigns to increase awareness of the issue, including encouraging businesses in Hong Kong and across the Pearl River Delta to sign the "Clean Air Charter," committing their companies to higher environmental standards.
CLP has also worked hard over the years to help Hong Kong become greener, introducing nuclear energy and pioneering the use of natural gas, which successfully reduced the city's carbon emissions. We also work with schools to explore climate change issues and green living with children through fun and dynamic activities.
Looking to the future, we know that there is still work to be done for Hong Kong to meet its carbon reduction commitments in the Paris Agreement. The city's sustainability goals will not be easy to reach. But I trust that the business community will continue to work together, develop new innovations, and come up with ways to create a better Hong Kong for all citizens over the next 25 years.
Betty Yuen, Group Director, CLP Holdings
Seamless Collaboration and Building Trust
We have achieved another milestone as Hong Kong marks the first 25 years of the establishment of the HKSAR.
While what we have experienced, particularly in the last three years, has not been uneventful nor without challenges, Hong Kong people have again proven ourselves to be determined, resourceful and resilient.
Through the recent trying times – from social unrest and financial market volatility to the Covid-19 pandemic – we have stayed focused and determined to identify solutions and bring the best out of a tough situation.
As an international financial centre and the gateway to Mainland China, Hong Kong has retained its advantages with our sound financial, legal and judiciary systems.
Under the "one country, two systems" guiding principle of the Basic Law, Hong Kong is resilient, and ready to fulfill its vital role in the Greater Bay Area development plan as well as the nation's 14th Five-Year Plan.
Looking forward to our next 25 years, I see building trust and advocating seamless collaboration as the top priority for the city. In this regard, the professional services industry has much to contribute.
From strengthening Hong Kong's position as a leading international finance centre, nurturing younger generations of accounting professionals, and fortifying trust in the capital market as well as among different sectors and industries, the accounting profession will continue to evolve and grow, to uphold integrity and to contribute to the growth of the economy.
We will build a better working world and a better Hong Kong, as we start a new chapter, together.
Agnes Chan, Managing Partner, Hong Kong & Macau, Ernst & Young
Hong Kong in the 21st Century: An Evolving Global Gateway City
Our city has transformed from a Chinese fishing village of 6,000 inhabitants, to a British trading centre under a colonial set up to the world’s third largest financial centre with a population of 7,500,000 today under a One Country Two Systems set up with our own mini constitution.
Hong Kong is in the post-97 season. So far, the 21st century has seen geopolitical uncertainties and technological advances. It has also been a period of opportunity driven by China’s progress.
The last episode ended with an unprecedented pandemic that tested our resilience. The economy, the Hang Seng Index, the Centaline Property index and employment dropped by 6%, 25%, 4.8% and 5% respectively. Similar to Tokyo and Singapore, our net migration has risen.
Today, global headwinds remain. Inflation and interest rates are shifting quickly. However, presently global logistics and Covid-19 policies are unravelling. Longer term, we have the Greater Bay Area Initiative, the Northern Metropolis Development and other opportunities.
This next episode begins with a fresh breeze as we emerge from the pandemic with a new leadership team focused on strengthening governance; boosting land supply; enhancing competitiveness while pursuing sustainable development; and building a caring and inclusive society with an emphasis on youth development.
Businesses and families have faced new working and living patterns. As we emerge from Covid-19, there may not be a quick click and fix. So as a Chamber, we will continue to engage businesses and advocate stakeholders to contribute to make Hong Kong a more competitive and sustainable international commerce platform.
Hong Kong is a uniquely-placed international business centre, supported by our core values and spirit of entrepreneurship. Looking forward, we have all to play for!
Douglas Woo, Chairman and Managing Director, Wheelock and Co
Continuing Hong Kong's Role as a Global Hub
As the Hong Kong Special Administrative Region marks its 25th anniversary, our city continues to be one of the best places in the region to do business – with great fundamentals. These include our roles as a world-class finance centre and international aviation hub, as well as one of the top IPO centres in the world.
The SAR's special status as gateway to the Chinese Mainland means that 25 years on, Hong Kong is still the platform of choice for organizations around the world to expand into the region, as well as for Mainland companies to go global. The National 14th Five-Year Plan has clearly enshrined Hong Kong's continuing role as an international business centre and an international aviation hub.
Over the past quarter century, we have faced numerous challenges: the global financial crisis, SARS, social unrest, and more recently the Covid-19 pandemic and global economic fallout from the war in Ukraine. But throughout its history, Hong Kong has proved remarkably resilient and successful at bouncing back.
For the SAR to continue to thrive in today's uncertain climate, it is critical that Hong Kong makes the best use of the opportunities afforded by the National 14th Five-Year Plan, in which Hong Kong's continuing role as an international financial, transportation and trading centre has been clearly set out.
In particular, Hong Kong should leverage the enormous opportunities presented by the development of the GBA. The meteoric growth of our nearest neighbours will be key to Hong Kong maintaining its own competitive advantage.
Guy Bradley, Chairman, John Swire & Sons (H.K.) Limited
Looking Ahead to a New Chapter
For the past 25 years, Hong Kong has endured ups and downs – with challenges such as the Asian financial storm, SARS, the global financial tsunami, Occupy Central, the Anti-Extradition Law Amendment movement – and has still come out stronger afterwards. Today, we are dealing with the impact of the pandemic.
With the unwavering support of the Central Government, Hong Kong has successfully implemented "one country, two systems" over the past 25 years, while sustaining its role as an international financial, transportation and trade centre. Even with these attributes, in view of the intensifying global competition, we can no longer simply thrive on our existing advantages. Hong Kong should embrace its role in the national development blueprint, as it will allow us to grow our economy.
In the coming five years, the new administration has a huge responsibility to prioritise three areas, so that businesses and people from all walks of life can benefit: First, to consolidate and enhance Hong Kong's status as an international financial centre; second, to boost our post-pandemic economic recovery and to attract and retain talent; and third, to tell a positive "story of Hong Kong" to people at home and overseas.
The theme of the 25th anniversary celebrations marking the return of Hong Kong to the Mainland is "A New Era – Stability, Prosperity, Opportunity," which is also my wish for Hong Kong. I sincerely look forward to a more conscious effort by the new Administration to foster social cohesion. All members of society should also try to set aside our differences, grasp the opportunities ahead and step forward together.
Jeffrey Lam, Managing Director, Forward Winsome Industries
Continue Our Mission with Renewed Visions
The past few years may have been the worst of times in living memory for doing business, not only within Hong Kong, but globally. For more than two years, the pandemic has forced us to shut down major international events, prevented us from meeting our business partners, and required us to develop contingency plans for future unknowns.
With a new Administration now in place, I hope that our international borders will soon be opened and that social-distancing restrictions will be gradually lifted, so Hong Kong and the business community can continue to contribute as the super-connector.
The pandemic has also fundamentally transformed the way we do business. To adapt to the new normal, we will
need to revitalise our "Lion Rock spirit" through being proactive to reach out to different parts of the world, while at the same time being adaptive to the ongoing transformation of the global economy.
In the asset management industry, one of the major pillars of our city, we have already established world class infrastructure and nurtured seasoned financial experts. With a renewed vision that combines the search for new opportunities presented in China, the rebranding of our city's international DNA, and innovation in financial products and asset classes, we believe that we will be able to turn the worst of times to the best of times.
Jennifer Chan, Chairman, DT Capital
Embarking on a New Journey
Twenty-five years into reunification with the Motherland, Hong Kong has grown into one of the world's leading and most dynamic financial centres by successfully grasping the opportunities offered by China's rapid economic growth. During this time, I have been engaging in my group's development in the Mainland and have witnessed many success stories of our fellow Hong Kong professionals and entrepreneurs from different sectors. They play an important role and have made many positive contributions to the Mainland's growth over the past 25 years.
China has achieved its first centenary goal of building a moderately prosperous society, and is now fully committed to achieving the second goal of being a modern socialist country by 2049. Being the ''Pearl of the Orient'', Hong Kong plays an indispensable role in the growth of China as a new world economy and in helping to pave the road to national rejuvenation.
Under the country's GBA blueprint, Hong Kong will continue to display its indomitable Lion Rock and innovative spirit towards sustaining prosperity in the world's number one bay area.
Eric Fok, Vice President, Yau Wing Co
Best Is Yet to Come: Hong Kong Beckons
The pandemic in the last two years has swept the world like a hurricane, giving rise to economic and social challenges that none could escape. Hong Kong is no exception. Whilst everyone is still battling the near-term aberrations, one should recognise that the core of the city's success – the well-established financial infrastructure, free movement of capital, rule of law, and simple and low tax regime – remains intact.
Reflecting over the past 25 years, China's financial opening has brought unprecedented opportunities to Hong Kong. A host of substantive and diverse initiatives have been launched for Hong Kong to channel capital between the Mainland and international markets, including cross-border RMB trade settlement, the Shanghai-Hong Kong and Shenzhen-Hong Kong Stock Connects, Bond Connect and the Wealth Management Connect under the GBA initiative. These have added significant breadth and depth to the financial industry, which is a source of envy to many.
With China's path towards further reform and opening set to continue, the size of the prize is significant. Looking ahead, we expect to see this trend pick up in speed, whether in the form of global portfolio rebalancing towards Chinese assets, shifts in supply chain flows, or the need for Chinese wealth to diversify into global financial assets. Either way, as an international financial gateway, Hong Kong has an irreplaceable strategic role to play, connecting China, the key engine for global growth, with the rest of the world.
This is only the beginning, and the best is yet to come.
Benjamin Hung, CEO, Asia, Standard Chartered Bank
Transport Development Driving Hong Kong's Growth
As we celebrate the 25th anniversary of the establishment of the Hong Kong SAR, we also celebrate 25 years of successful city development in Hong Kong. Hong Kong's recent urban development is a classic demonstration of successful TOD (transit-oriented development).
The railway network had less than 100 kilometres in route length before the establishment of the Hong Kong SAR. Now the network has grown to 267 kilometres, serving all 18 districts of Hong Kong, enabling the growth of new towns such as Tung Chung, Tseung Kwan O and LOHAS Park, and accelerating the regeneration of districts such as Yuen Long.
There is also the high-speed rail that bring much of the GBA within one-hour's reach from West Kowloon. TOD has enabled the citizens, businesses and the economy to grow with the city.
With the new development plans for the Northern Metropolis and Lantau Tomorrow, HKSAR will continue our next generation of urban development, creating new standards for a vibrant and livable city.
Jacob Kam, Chief Executive Officer, MTR Corporation
Confidence in Hong Kong's Recovery
Firstly, congratulations on the 25th anniversary of the establishment of the Hong Kong SAR, an unprecedented and unpredictable period marked by positive and negative volatility.
We have experienced significant developments: taking the lead in financial services, innovation and technological advances – particularly relating to the GBA. However, the city has also faced social unrest and the pandemic, which have affected our society at all levels.
The protesting issue has been resolved now that the National Security Law is in place; however, the reverberations have somewhat tarnished our international image, which we need to address. We need to re-establish the international community's confidence that Hong Kong is a great place for business, and is also very safe and liveable.
We understand that we may need to live with the impact of the pandemic for some time; but for now, the situation is under control.
From the perspective of trading and manufacturing of consumer products, we have been significantly impacted by supply chain doldrums, long logistics delays and extreme freight charges, and shortage of raw materials – leading to the inflationary pressures that we are experiencing today.
Fortunately, the situation has been gradually improving, and hopefully once the Russia-Ukraine conflict has stabilized, business will return to some degree of normality.
In Hong Kong, we are very fortunate to be able to grasp the vast opportunities from being a part of the GBA, and also engage in the Belt and Road Initiative.
GBA openings are vital for our youth: capturing these opportunities will enhance their prospects and also play a critical role in Hong Kong's future. It is imperative, then, that our young people take up the challenge and understand that such projects will benefit them and contribute to the growth of Hong Kong.
Neville Shroff, Chairman and CEO, Shroff & Co
Entering a New Era of Prosperity
This year marks the 25th anniversary of Hong Kong's return to the motherland. Over these years, the city has overcome major challenges including the Asian financial crisis and the global financial crisis. Thanks to the successful implementation of the "one country, two systems" principle, we have made significant social and economic progress, with our status as an international financial, transportation and trade centre remaining solid.
Since taking root in Hong Kong 105 years ago, Bank of China has been dedicated to serving the community. For more than a century, we have grown and thrived alongside with the city, and we are proud of the contribution we have made to Hong Kong's economic development and people's livelihood through our financial strength.
Hong Kong has entered a new era of governance and prosperity. As the National 14th Five-Year Plan has set out a blueprint for Hong Kong's future development, and the implementation of the Greater Bay Area initiative has been steadily increasing, Hong Kong is set to benefit from the tremendous opportunities arising from these developments.
Bank of China (Hong Kong) will fully support the SAR Government in governing in accordance with the law and Hong Kong's efforts to promote economic development, improve people's livelihood, and strengthen our status as an international financial centre. We are also committed to supporting Hong Kong to continue to play to its advantages with a view to further integrating into the "dual circulation" strategy. By actively fulfilling our social responsibilities, we will strive to contribute to the steadfast implementation of "one country, two systems," as well as the long-term prosperity and stability of Hong Kong.
Sun Yu, Vice Chairman and Chief Executive, Bank of China (Hong Kong)
Hong Kong at 25: Capitalising on Connectivity
In the 25 years since the handover, Hong Kong has weathered two major financial crises, been heavily tested by social unrest, geopolitical tensions and the Covid-19 pandemic, but has shown sustained resilience and vitality. Hong Kong’s central role as an international financial centre and business hub has been reinforced by its openness to the outside world and access to mainland China. None of this came easily.
Hong Kong’s unique advantage as a world city – its ability to leverage its links to mainland China while engaging with the rest of the world – is unrivalled. “One country” makes Hong Kong first in line in participating in China’s national development plans, while “two systems” allows the territory to maintain a regulatory system that complies with international standards, has free flow of capital, and a highly open and internationalised market. Hong Kong has translated these advantages into a role both as a testing ground for mainland policy reforms and as a firewall protecting against financial risks as China pushes reform of its financial system.
Looking ahead, under China’s 14th Five-Year Plan, Hong Kong will benefit from its key role in dual circulation. It will also be in a strong position to make good use of its advantages – capital, scientific research, high value-added service and talent – in the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) to develop into a world-leading innovation hub.
We can also seize opportunities in the global carbon and green financial markets, bring international capital to participate in China’s low-carbon economic transformation, and encourage more mainland institutions to issue green bonds in Hong Kong. Most importantly, by supporting the liberalisation of China’s carbon market, Hong Kong can help the GBA become a bridge between China and the rest of the world and become a carbon trading and finance centre with global influence.
At the same time, Hong Kong should strengthen its international connectivity, with a particular emphasis on embracing regional economic cooperation. Hong Kong is not only a primary offshore capital-raising centre for Chinese companies as the mainland “goes out”, it will also play a vital role in China’s participation in addressing global challenges, formulating international standards and aligning policies with international norms.
The next 25 years will see Hong Kong continue to evolve as it searches for new opportunities in its relationship with a thriving mainland economy, whilst capitalising on its international connectivity build on its reputation as Asia’s global city. Hong Kong’s future is looking bright and I am thrilled to play a part in its story.
Peter Wong, Chairman, The Hongkong and Shanghai Banking Corporation Limited
Proactively Engage in Hong Kong's Promising Future
The 25th anniversary of the establishment of the Hong Kong SAR is an important milestone to celebrate the remarkable achievements of the "one country, two systems" principle over the past quarter century, and also a good time to envisage Hong Kong's promising future.
During the past 25 years, Hong Kong has weathered many ups and downs, and overcome enormous difficulties to enter a new era of stability, prosperity and opportunity. During this period, HKGCC has dynamically and strategically participated and represented the voice of the business community in Hong Kong, and expanded our connections and networks. This is despite the many twists and turns we faced, with ever-changing challenges arising from every critical moment, such as the Asian financial crisis, the SARS outbreak, the global financial tsunami and the Covid-19 pandemic.
Despite the challenges, with every endeavor of Chamber members, the business community has constantly maintained and developed the city's competitiveness and resilience.
Looking forward, Hong Kong must be proactive and fully engage in developments including the GBA, the Belt and Road Initiative and the 14th Five-Year Plan. Participation in these plans will help us to build Hong Kong into not only an international financial, transportation and trade centre, but also meet Hong Kong's aspirations to become an international innovation and technology centre, an international aviation hub, and an East-meets-West cultural hub.
As we look forward to the next 25 years, Hong Kong is embracing a new era by grasping the opportunities to overcome challenges and scale new heights.
Pang Chun Yu, Director and General Manager, Yue Hwa Chinese Products Emporium
Construction Industry Faces New Challenges in a New Era
This year marks the 25th Anniversary of Hong Kong's reunification with the Mainland, and a new government is set to bring back economic growth for Hong Kong in the next five years. There has been a recovery in the construction industry due to some major government projects in transportation and housing infrastructure, outlined in the 2021 Policy Address.
However, public works alone in the short and medium term are not enough to boost the outlook for the construction industry, which is now being affected by a number of key risk factors. These include the Omicron variant and the related delay in the full reopening of Hong Kong with the Mainland, which will further slow the city's economic and industrial recovery.
The industry is also facing the current issues of high labour costs among all fields and levels of construction work, the undersupply of building materials, an ageing workforce, and the lack of government policy and incentive schemes to help SMEs in the construction sector. All of these will contribute to an increasingly competitive business environment throughout 2022 and beyond.
Due to the current shortage of skilled workers in Hong Kong and the phasing out of the MPF offsetting mechanism, the construction industry is also in need of a government-regulated imported labour scheme to boost the workforce in the construction industry.
Looking to the future, I am confident that the newly-formed government will devote much effort in developing a more efficient framework for the construction industry, in view of the various upcoming major infrastructure projects in 2022 and beyond.
Edmond Yue, Director, Innopipe Engineering Co
Photo: HKSAR Government