Blog

Serving as Three Centres and a Hub

At the Third Plenary Session of the 20th Central Committee of the Communist Party of China (CPC Central Committee) held in Beijing last month, the Resolution of the Central Committee of the CPC on Further Deepening Reform Comprehensively to Advance Chinese Modernisation (“the Resolution”) was adopted. The Resolution is of crucial importance to the future development of our country and Hong Kong. Last Friday, the Chief Executive hosted a study session on the spirit of the Third Plenary Session and its implementation together with the Principal Officials and other senior officials. At the seminar, I also shared my understanding of the spirit of the Third Plenary Session and put forward some ideas for implementing the spirit in our future work.

A paragraph in the Resolution mentions explicitly the strategic positioning of Hong Kong, which, in summary, is to serve as “three centres and a hub”. This is a task that we must strive to get done well.

The Chief Executive hosted a study session last Friday on the spirit of the Third Plenary Session and its implementation together with the Principal Officials and other senior officials.

Regarding the “three centres”, the Resolution writes, “Harnessing the institutional strengths of the One Country, Two Systems policy, we will work to consolidate and enhance Hong Kong’s status as an international financial, shipping, and trade centre.”

As an international financial centre, Hong Kong boasts a deep and broad financial market, and has attracted world-class international financial institutions and talent. To further reinforce and enhance Hong Kong's status, more in-depth, broader, and focused interactive developments are needed: deepening market transactions; expanding the scope of financial products and their functions; and better meeting the financing needs of corporations. We should also enhance exchanges with different regions to widen our sources of funds. Enjoying the advantages of a highly efficient market, rule of law, and an international character under the "one country, two systems" principle, Hong Kong connects both the Mainland and the world, continuing to serve as a "testing ground" and "firewall" in the country’s reform of the financial sector and aid in its high-standard openness.

We should fully leverage our role as an offshore renminbi (RMB) business hub. By enhancing offshore RMB liquidity, expanding products and risk management tools, improving infrastructure, and exploring new markets, we can help with the steady and prudent advancement of RMB internationalisation.

As for the development as a shipping centre, smart shipping, green shipping as well as maritime-related professional services are our key directions of development. The Government has promulgated the Action Plan on Maritime and Port Development Strategy last December, which sets out ten major strategies and 32 action measures to support the sustainable development of the maritime and port industry in Hong Kong, particularly on accelerating the development of its high value-added maritime services cluster to enhance the long-term competitiveness of the industry. In the past few years, we have introduced a series of tax incentives to promote the development of the maritime industry, and we are conducting a study this year on further enhancements. We will also examine ways to further drive the enhancements and innovations of the related regime, with a view to reinforcing and enhancing Hong Kong’s position as an international shipping centre.

As for the development of a trade centre, it is our vision to develop Hong Kong into a multinational supply chain management centre to provide one-stop support to Mainland enterprises seeking to "go global" in their overseas production and supply chain distribution. Such support services would cover supply chain management, trade financing to professional consulting services. We would assist the enterprises concerned in participating more deeply in global industrial division of labour and cooperation under a complex geopolitical situation. As more Mainland enterprises seek international development and set up their production lines overseas in order to serve the global market better, there will be a higher demand for trade services, bringing greater opportunities for Hong Kong.

These three centres have their respective focuses yet support each other. Developing financial services is about serving the real economy, including such areas as innovation and technology, trade and shipping. In turn, robust high-end maritime services and high value-added trade services will stimulate demand for financial products. Meanwhile, we are actively developing a "headquarters economy”, attracting quality domestic and foreign enterprises to establish their regional or international headquarters in Hong Kong. This would place us in a better position to engage in the vibrant development of the national and international dual circulation initiative, and seize opportunities in the Guangdong-Hong Kong-Macao Greater Bay Area development and the high-quality development of "Belt and Road" initiative.

As regards “a hub”, the Resolution mentions the work to support Hong Kong in building itself into an international hub for high-calibre talent. Hong Kong is the only city in the world with five of the world’s top 100 universities; it is also home to more than 50 international schools. A pluralistic and inclusive society with a blend of Chinese and Western cultures, Hong Kong is characterised by good law and order, a low and simple tax regime and a quality living environment. All these characteristics have made Hong Kong a highly attractive place to talent from the Mainland and overseas. The HKSAR Government is making every effort to trawl for talent by introducing an array of measures, including the Top Talent Pass Scheme, to facilitate access for talent to work in Hong Kong. Meanwhile, our vigorous efforts in attracting enterprises and investments are creating more high value-added jobs, helping us to retain talent and leverage their expertise. Since late 2022, we have received a total of over 340 000 applications under various talent admission schemes, of which 210 000 have been approved and over 140 000 applicants have arrived in Hong Kong. Looking back, the robust development of Hong Kong’s financial industry has drawn in a large pool of financial talent. A thriving industry and a vibrant ecosystem are key to attracting high-end talent, who in turn would help promote industry development and innovation, thereby forming a virtuous circle. As long as we stay committed to our goals with a clear mindset, and continue to enhance our policies and ancillary support to facilitate talent development, we will be able to attract more high-end talent from across the world. They will join hands with our local talent in empowering Hong Kong’s high-quality development and contributing to our country’s new quality productive forces.

On the whole, with “Chinese modernisation” as the overall development framework, the Third Plenary Session has comprehensively outlined the significance and general requirements of deepening reform. It has emphasised the importance of maintaining confidence and determination in promoting high-quality economic development, supporting technological innovation and developing new quality productive forces. It has also highlighted the need to enhance relevant institutions and mechanisms having regard to prevailing circumstances and local conditions. As our country expands institutional opening up and comprehensively deepens reform, it is crucial for us to consider how Hong Kong could effectively implement its strategic positioning as set out by the country. We must seize opportunities to integrate into the new national development landscape with a proactive attitude and commitment. By contributing to Chinese modernisation, we will achieve faster and better development. In a complex and volatile political and economic environment, Hong Kong will inevitably face challenges on its path of development. Yet, with its favourable conditions, Hong Kong enjoys unique advantages over other places. Blessed with our greatest strengths of the “one country, two systems” principle, Hong Kong will surely have a better future so long as we embrace change proactively, are united in purpose, and strive for progress in response to the ever-changing internal and external environments.

August 11, 2024