China’s Belt and Road Initiative, or BRI, inaugurated in 2013, is a massive infrastructure project involving the construction of roads, railways, ports, and other facilities in over 139 countries and regions with the aim of boosting economic ties among participating countries. Given Hong Kong’s unique history and international status, the city has every reason to assume a more significant role in the BRI going forward.
Hong Kong has been governed under the “one country, two systems” framework since its return to China. This arrangement enables Hong Kong to retain its legal system, currency and way of life while remaining an integral part of China. The “one country, two systems” policy, which Beijing has unwaveringly and effectively implemented over the past 25 years, provides Hong Kong with significant autonomy, serving as the cornerstone and foundation for the city’s stability and prosperity since 1997. All lawful rights, including the right to free expression and the advancement of democracy, are also guaranteed by the Basic Law. Furthermore, Hong Kong is an established international financial center, with numerous multinational banks and businesses having set up their regional headquarters in the city. These strengths and advantages, combined with the city’s traditional role as an intermediary between the Chinese mainland and the outside world, make it an ideal bridge between China and the rest of the world.
Thus far, Hong Kong has contributed to the BRI only in a relatively modest way. This is primarily due to the fact that State-owned enterprises and the Chinese government have been spearheading the effort. Many people in Hong Kong are hesitant to participate in the project because they perceive it to be an exclusively mainland endeavor
Thus far, Hong Kong has contributed to the BRI only in a relatively modest way. This is primarily due to the fact that State-owned enterprises and the Chinese government have been spearheading the effort. Many people in Hong Kong are hesitant to participate in the project because they perceive it to be an exclusively mainland endeavor. The fact is, Han Zheng, vice-premier of China’s State Council, stated in his opening remarks at the seventh Belt and Road Summit held last month that the central government is strongly in favor of Hong Kong’s participation in the BRI.
ALSO READ: China shares steelmaking wisdom via BRI
“Hong Kong’s service industry is highly professionalized, with enormous room for further development,” Han said. “We support Hong Kong in upholding its common law system, developing highly value-added shipping services, continuously improving financial services and cooperation so as to provide the BRI with tailor-made professional services in legal, shipping and financial consultation and support. It’s the best way to build up Hong Kong’s leading edge in the highly-competitive international services market,” he continued.
READ MORE: 20th National Congress: HK legal sector to benefit from BRI
Luo Huining, director of the Liaison Office of the Central People’s Government in the Hong Kong Special Administrative Region, reaffirmed Beijing’s support for the city’s participation in the BRI during a more-recent seminar. According to a China Daily report, he declared that the coming five years will be especially “crucial for Hong Kong to achieve new successes”.
Han was justified when he asserted that Hong Kong has much to offer to the BRI. In addition to being strategically located to serve as a link between the Chinese mainland and the rest of the world, Hong Kong possesses a sizable pool of talent with bilingual skills and international experience and has the unique status as a special administrative region of China. Furthermore, the vast majority of foreign enterprises that operate in the mainland also have a presence in Hong Kong; these businesses are most likely to participate in BRI projects.
With its open, free economy, low taxation, unrestricted port commerce and established global financial industry, Hong Kong has made significant strides in retaining its competitiveness under “one country, two systems”. It also offers a stable and sound business environment with level playing fields in which companies of all sizes can thrive and prosper. Hong Kong has long emerged and been recognized as the main gateway to the Chinese mainland and the premier offshore renminbi trade hub, underpinned by an efficient financial infrastructure. Hong Kong has generated and facilitated two-thirds of China’s inward and outward direct investments. By offering an array of RMB financial services, the city enables participants from all over the world to manage their RMB transactions with the Chinese mainland.
Furthermore, Hong Kong’s internationally acclaimed professional expertise spans a wide range of sectors, including finance, law, operational risk assessment, human resources, international arbitration, and mediation. The city is well-versed in both market economics and government development strategies. Professionals from Hong Kong can act as expert intermediaries to help participants understand the interconnectedness of development objectives and play a crucial role in policy coordination between the Chinese government and other countries along the BRI routes.
Meanwhile, Hong Kong’s robust legal system will provide valuable protection for investors. Some BRI-participating countries have weak rule-of-law systems, making it difficult for investors to resolve and settle disputes. In comparison, the legal system in Hong Kong is reputable and effective. Beijing has long supported and advocated for the transformation of Hong Kong into an international arbitration center, and the BRI provides the ideal opportunity to do so.
Lastly, Hong Kong possesses an excellent world-class infrastructure and is home to a sizable airport, a significant port, and an efficacious public transportation system. These facilities will be crucial for facilitating the free flow of people and products into and out of the Chinese mainland.
Hong Kong, of course, is not without its challenges and obstacles. The city’s high cost of living can be a deterrent for some businesses. Similar to this, political and societal turmoil can cause investors to become apprehensive. If the city is to play a significant role in the BRI, it must retain its attractiveness and boost its appeal as a desirable destination for talent and capital.
Consequently, given its privileged situation and potential benefits, Hong Kong must strive and collaborate to play a pivotal role in the BRI, contributing to the success of this vast and ambitious project and unleashing its full potential in the process.
The author is founder of Save HK and a member of the Central Committee of the New People’s Party of the Hong Kong Special Administrative Region.
The views do not necessarily reflect those of China Daily.