The high-profile central government delegation’s recent trip to Hong Kong, during which it expounded on the nation’s 14th Five-Year Plan (2021-25) in great detail, has helped Hong Kong people visualize a promising future for the city: The city will regain its foothold and reclaim its economic prowess in the post-pandemic era with the central government’s support stated in the new national development blueprint. It turned out to be the first time in the world’s freest market economy that the merits of economic planning are being pondered. And a clear vision for socioeconomic development for the special administrative region has been defined. The clearer the vision is, however, the bigger the stumbling blocks appear to be for Hong Kong to tackle ahead.
The elephant in the room is the social discord that splits society and brings Hong Kong to a standstill. If Hong Kong wants to grab the low-hanging fruit offered by the State, the city should take the second chance afforded by the central government and participate proactively in the 14th Five-Year Plan. The city’s stagnant economic development and deteriorated social stability are pressing issues that have pushed Hong Kong almost to its wits’ end. Lamented by many who fondly care for the city’s future, the disruption caused by social unrest was obvious and harmful. When will Hong Kong be able to bounce back from rock bottom?
With the rolling out of the 14th Five-Year Plan, Hong Kong should waste no time carefully assessing its role in the national economy, and wisely incorporate the vision of long-term development with its free-market economic system for the sake of a bright future for the city.
The 14th Five-Year Plan has lit up hopes. In Chapter 61 of the plan, Hong Kong is involved in the country’s building agenda, with an emphasis on its integration into the Guangdong-Hong Kong-Macao Greater Bay Area. Ever since its return to China in 1997, Hong Kong’s development has been closely entwined with that of the Chinese mainland. The symbiotic relationship between the two sides suggests that Hong Kong’s progress in developing an innovative economy reliesto a high degree on the development strategies mapped out by the central government.
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The “blood tie” between Hong Kong and the mainland was strong. In the 1970s, Hong Kong industries moved their operations, particularly secondary-labor factories, to the mainland for the benefit of lowerproduction costs there. This trend, which coincided with the country’s reform and opening-up, transformed Hong Kong’s primary economy from light manufacturing to top-notch industrial exportation. In 1993, Hong Kong welcomed the first State-owned company to be listed in the local stock market, initiating the trend for mainland companies to raise funds from Hong Kong; 20 years later, the launch of the Shanghai-Hong Kong Stock Connect has furthered strengthened the local stock market. History and past experience show that Hong Kong has gained tremendously from incorporating with the mainland market.
The question is: In the post-pandemic era, how can Hong Kong hack the way through the obstacles and act in alignment with the 14th Five-Year Plan? Can Hong Kong be resilient and resourceful enough to turn “crisis” into “prizes”?
“The ‘romantic epoch’ of fitting the market niche in the global supply chain is gone,” said Zhang Yansheng, the chief researcher of the China International Economic Exchange Center, during the “Five Plans” discussion panel on Aug 24. Amid deteriorating geopolitics, the plan has established a solid foundation for the country’s future development, particularly by introducing the “dual circulation” strategy. This new development model focuses on internal circulation as the mainstay for domestic economic development. Hong Kong shall play a proactive role in this game to gain a pioneering advantage.
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The mainland side of the Greater Bay Area provides strong momentum that would be able to push Hong Kong to move forward in leaps and bounds. The region is turning out to be a “promising land” for the job hunters from Hong Kong who are aspiring for sustainable and promising career development. The “dual circulation” aims to bring out qualitative and efficient development. Hong Kong, geographically and historically, is in the best position to play as a regional coordinator in multinational agreements.
Apart from maintaining its traditional pillar industries, Hong Kong must also tap into the ample opportunities available in innovative sectors like digital-currency utilization and virtual asset management. In Chapters 4 to 6 of the plan, innovative technology is a crucial and indispensable area for the country. For instance, it aims to attract overseas talents to exchange their technological ideas, optimizing the “technological immigration” system, and increasing corporations’ ability to invest in innovative science. Digitalization bridges Hong Kong with the partner cities in the GBA and virtually knits the network of the cities into an economic cluster. With the support of the central government, digitalization in the GBA will likely generate handsome rewards. The bigger the challenge is, the bigger the opportunities are.
With the rolling out of the 14th Five-Year Plan, Hong Kong should waste no time carefully assessing its role in the national economy, and wisely incorporate the vision of long-term development with its free-market economic system for the sake of a bright future for the city.
Edmond Sy Hon-ming is a guest researcher of the One Country Two Systems Youth Forum.