Tam Yiu-chung says facilitating economic recovery and addressing social problems should top the city’s priority list.
Time flies by at its own pace whether one likes it or not as we usher in 2023. In the past three years the whole world has been ravaged by the COVID-19 pandemic, with nations big and small feeling the pain of an economic slump, healthcare crisis and resulting political fallout with few exceptions. That said, the trend in great changes unseen in 100 years, often referred to as a paradigm shift in the global power balance toward the East from the West, remains apparent and steady if not accelerating. As the pandemic becomes less deadly, while government responses in various countries and regions find their “groove” each day, economies around the world are returning to normal, including in Hong Kong. In 2023, I hope, Hong Kong society will prepare as best as we can to achieve full economic recovery and stronger development along with the motherland.
Exploring new opportunities
President Xi Jinping, in his speech marking the 25th anniversary of Hong Kong’s return to the motherland on July 1, expressed four expectations for Hong Kong moving forward, one of which is for increased development kinetics. Hong Kong, as the top international financial center in Asia as well as a free market and outward-looking economy, has always cultivated and profited from extensive economic and trade ties with Southeast Asia as well as the US and Europe. In recent years, however, the global situation has changed dramatically. As a result, Hong Kong’s economic cooperation and trade with the US and Europe are most likely to face more constraints in future. Therefore, we must make more efforts in exploring new trade opportunities and development approaches.
President Xi’s historic visit to several Middle Eastern countries in December 2022 drew enormous attention from around the world, setting a series of milestones in China-Gulf and China-Arab cooperation, upgrading relations to a whole new level. On Dec 9, the inaugural China-Gulf Cooperation Council Summit concluded with the signing of an agreement covering five main areas of cooperation, including multidimensional energy production and trade, further cooperation in finance and investment, expanding the scope of technology and innovation cooperation, realizing new breakthroughs in space exploration and creating new platforms for bilingual learning and cultural exchanges. Hong Kong can and should make full use of its status as a center of international finance and trade in Asia to play a constructive role in assisting China-Middle East cooperation and joint development, which will no doubt benefit its own economic growth along the way.
Hong Kong should participate in and support the nation’s financial and investment cooperation with Gulf countries by leveraging the achievements of the China-GCC Summit, and strengthen the city’s status as an international financial hub in the process. For example, Hong Kong can offer professional assistance to China-GCC cooperation in financial regulation and mutual investment, such as hosting international symposiums on China-GCC cooperation in industry and investment development. The Hong Kong Special Administrative Region government has been intensely studying policies related to the digital economy in recent years, and Hong Kong should pursue a proactive role in digital and green economy cooperation with Middle Eastern countries by establishing a working mechanism for bilateral investment and economic cooperation. To this end, the HKSAR government should adjust the layout of its global economic and trade offices as appropriate, focusing on key countries and regions taking part in the Belt and Road Initiative, especially the Middle East. In doing so Hong Kong-based businesses will no doubt enjoy more growth opportunities.
Emerging from pandemic
Hong Kong has long been a favorite destination of tourists from around the world, which is why its travel and tourism sector is one of the city’s economic pillars. It is no surprise that the tourism industry has been devastated by the COVID-19 pandemic. In 2018, tourism accounted for about 4.5 percent of the city’s GDP and provided 257,000 jobs, accounting for about 6.6 percent of its total employment. In 2019, Hong Kong received only 55 million visitors, down 14.2 percent from 2018; the situation worsened further in 2020 with a 93.6 percent drop in visitor numbers to 3.5 million. But the tourism sector is expected to pick up the pace of recovery as travel restrictions are relaxed, if not completely lifted, beginning with the resumption of quarantine-free cross-boundary travel between Hong Kong and the Chinese mainland before the upcoming Lunar New Year holidays. It’s safe to expect much better days ahead for Hong Kong’s tourism sector as the local economy in general improves in the near future.
The Central Economic Working Conference ended on Dec 16 with a circular requiring, among other matters, prioritizing efforts to boost public consumption as a main growth engine in 2023. As such, the tourism industry in Hong Kong needs to seize every opportunity arising from a possible tidal wave of mainland visitors after quarantine-free cross-boundary travel resumes. Aside from optimizing its transport and hotel services, Hong Kong also needs to diversify the products and attractions of its tourism to attract more visitors as the mainland’s younger generation increasingly appreciates high-quality tourism that features cultural and humanistic elements.
Achieving high-quality growth
Financial Secretary Paul Chan Mo-po said in his 2022-23 Budget report that many young people cannot fulfil their aspirations because of unbalanced economic development, noting that “employment earnings of youths in the younger-generation with post-secondary education are generally significantly lower than those of the older-generation with similar educational attainment, indicating that the pace of economic upgrading falls short of creating sufficient high-quality jobs for young people”. While Chan singled out the youth, the lack of structural diversity in economic development has a multi-fold impact on social development.
Therefore, in future economic development, the promotion of industrial diversification should be one of the HKSAR government’s priorities, with an emphasis on developing Industry 4.0, which features smart production lines and high-quality, high-end products. The government should consider setting a development benchmark for the manufacturing sector in terms of its share in the economy. It should also increase the land resources for industrial use, cooperate with the Vocational Training Council in promotion work and provide tax incentives to promote the development of Industry 4.0, and lay the foundation for industrial diversification.
Conclusion
The work report of the 20th National Congress of the Communist Party of China unequivocally declared that, “From this day forward, the central task of the Communist Party of China will be to lead the Chinese people of all ethnic groups in a concerted effort to realize the Second Centenary Goal of building China into a great modern socialist country in all respects and to advance the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization.” Hong Kong undoubtedly has an arduous task in the years ahead as “one country, two systems” is an important part of Chinese-style modernization.
Since its return to the motherland 25 years ago, Hong Kong has gone through numerous trials and hardships. The National Security Law for Hong Kong promulgated in 2020 and the overhaul of the HKSAR’s electoral system in 2021 have ushered Hong Kong into a new era of governance and prosperity. In the years ahead, facilitating economic recovery and tackling deep-seated social problems should top the priority list of Hong Kong’s socioeconomic policies. It’s my sincere aspiration that Hong Kong society will unite and support the chief executive in exercising law-based governance, helping the city develop new growth drivers and set sail for a brighter future in 2023.
The author is a member of the National People’s Congress Standing Committee.
The views do not necessarily reflect those of China Daily.