Page 74 - 2018 White Paper on the Business Environment in China
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8 White Paper on the Business Environment in China
Zhejiang: improve the construction of Zhoushan FreeTrade Initiative, which aimed mainly the Mainland Chinese
Port as well as encourage commodity trade liberalization. part of the region. The new initiative was first brought
up in the 13th Five Year Plan (2016 – 2020) of China. In
Henan: establish a modern three dimensional traffic system contrast to its predecessor, the Bay Area Initiative intends
and modern logistics system meaning Henan will become a to highlight the region’s role and aspiration in the global
key location along China’s“One Belt One Road”connection. economic supply chain, such as other bay area regions
like San Francisco or Tokyo, and also emphasizes the
Hubei: hub for high-tech industrial bases focusing on inclusion of the Special Administrative Regions Hong
the Yangtze River Economic Belt. Kong and Macao. Besides these two regions, the city
cluster includes nine Chinese cities in the Pearl River
Sichuan: gateway to China’s western inland areas. Delta (Shenzhen, Guangzhou, Zhuhai, Zhaoqing,
Dongguan, Huizhou, Foshan, Zhongshan, Jiangmen) and
Shaanxi: facilitate the construction of the “One Belt wants combine each city’s expertise. The key industries
One Road” network. of the area, which are very competitive on the global
stage, are manufacturing (high-tech), transportation (sea
Chongqing: strategic position in enabling access to the west and air cargo services), trade-related services (sourcing,
of China facilitating the region’s overall future development. trading, freight-forwarding, finance etc.) as well as the
digital and innovation industry (CW CPA).
It is hoped that opening the Chinese market will
encourage more foreign investment. The government The Greater Bay is an initiative that seeks to
policies for FTZs focus on free market policies and economically integrate Hong Kong with the rest of the
flexible governmental measures to encourage foreign Pearl River Delta, akin to the San Francisco Bay Area in
firms to do business in China. Some of the benefits for California, the United States. In the future, Hong Kong
foreign entities operating in a FTZ include being able would be more closely connected to Guangdong cities
to choose a virtual office rather than a physical one, such as Guangzhou and Shenzhen economically and
quicker registration procedures, modified taxation rules physically. Richard Lancaster, CEO of CLP Holdings Ltd,
and several benefits associated with customs such as suggested that the Greater Bay Area Initiative could
that detailed customs clearance is not required until a present an opportunity for Hong Kong to develop
later stage. In addition, within the FTZs, foreign investors clean energy. “If we are trying to introduce renewable
can establish a wholly foreign owned enterprise (WFOE) energy or future fuel mix in Hong Kong, we’re very
rather than being required to partner with a Chinese much constrained by the amount of land that’s available
company in more industry sectors than in Mainland to us,” he explained. “By opening up our thinking and
China. For example, in the Shanghai FTZ manufacturing our borders, we can site renewable energy facilities in
of certain types of motorcycles is permitted for WFOEs a much bigger area.” Lancaster also added that Hong
whereas in Mainland China, foreign investors are Kong’s broadband and power infrastructure could
required to establish a joint venture for such business. facilitate the development of Smart City locally and
Also still unclear which industries are affected in the new in the Greater Bay Area. “Hong Kong […] is already
FTZs, similar measures are expected there. Although blessed with very high quality infrastructure, so we
announced earlier in 2016, opening the FTZs now in don’t have to worry about the speed of broadband,
2017 emphasizes China’s continued demand for foreign mobile phone coverage, quality of electricity supply, or
capital, as recent measures of the Chinese government quality of the transport system,” he said. “I think Hong
have signaled discontent due to increasing capital Kong has tremendous opportunity to be the leader in
outflows caused by fears of the decreasing value of the Smart City developments.” Joachim von Amsberg, Vice
yuan and the decline in China’s GDP growth rate (Beckett President, Policy and Strategy of The Asian Infrastructure
et al.). Investment Bank points out that emerging countries
face the problem of “infrastructure-finance paradox”, in
The Greater Bay Area Initiative which there is a significant demand for infrastructure
but no channel to invest in it. “The paradox is, there is a
The Guangdong – Hong Kong – Macao Greater Bay huge demand for infrastructure in finance,” he explained.
Area Initiative (also known as Greater Pearl River Delta “And on the other hand, you have asset managers sitting
Initiative) is an advanced version of the Pearl River Delta on tens of trillions of dollars. Some of them significantly
74
Zhejiang: improve the construction of Zhoushan FreeTrade Initiative, which aimed mainly the Mainland Chinese
Port as well as encourage commodity trade liberalization. part of the region. The new initiative was first brought
up in the 13th Five Year Plan (2016 – 2020) of China. In
Henan: establish a modern three dimensional traffic system contrast to its predecessor, the Bay Area Initiative intends
and modern logistics system meaning Henan will become a to highlight the region’s role and aspiration in the global
key location along China’s“One Belt One Road”connection. economic supply chain, such as other bay area regions
like San Francisco or Tokyo, and also emphasizes the
Hubei: hub for high-tech industrial bases focusing on inclusion of the Special Administrative Regions Hong
the Yangtze River Economic Belt. Kong and Macao. Besides these two regions, the city
cluster includes nine Chinese cities in the Pearl River
Sichuan: gateway to China’s western inland areas. Delta (Shenzhen, Guangzhou, Zhuhai, Zhaoqing,
Dongguan, Huizhou, Foshan, Zhongshan, Jiangmen) and
Shaanxi: facilitate the construction of the “One Belt wants combine each city’s expertise. The key industries
One Road” network. of the area, which are very competitive on the global
stage, are manufacturing (high-tech), transportation (sea
Chongqing: strategic position in enabling access to the west and air cargo services), trade-related services (sourcing,
of China facilitating the region’s overall future development. trading, freight-forwarding, finance etc.) as well as the
digital and innovation industry (CW CPA).
It is hoped that opening the Chinese market will
encourage more foreign investment. The government The Greater Bay is an initiative that seeks to
policies for FTZs focus on free market policies and economically integrate Hong Kong with the rest of the
flexible governmental measures to encourage foreign Pearl River Delta, akin to the San Francisco Bay Area in
firms to do business in China. Some of the benefits for California, the United States. In the future, Hong Kong
foreign entities operating in a FTZ include being able would be more closely connected to Guangdong cities
to choose a virtual office rather than a physical one, such as Guangzhou and Shenzhen economically and
quicker registration procedures, modified taxation rules physically. Richard Lancaster, CEO of CLP Holdings Ltd,
and several benefits associated with customs such as suggested that the Greater Bay Area Initiative could
that detailed customs clearance is not required until a present an opportunity for Hong Kong to develop
later stage. In addition, within the FTZs, foreign investors clean energy. “If we are trying to introduce renewable
can establish a wholly foreign owned enterprise (WFOE) energy or future fuel mix in Hong Kong, we’re very
rather than being required to partner with a Chinese much constrained by the amount of land that’s available
company in more industry sectors than in Mainland to us,” he explained. “By opening up our thinking and
China. For example, in the Shanghai FTZ manufacturing our borders, we can site renewable energy facilities in
of certain types of motorcycles is permitted for WFOEs a much bigger area.” Lancaster also added that Hong
whereas in Mainland China, foreign investors are Kong’s broadband and power infrastructure could
required to establish a joint venture for such business. facilitate the development of Smart City locally and
Also still unclear which industries are affected in the new in the Greater Bay Area. “Hong Kong […] is already
FTZs, similar measures are expected there. Although blessed with very high quality infrastructure, so we
announced earlier in 2016, opening the FTZs now in don’t have to worry about the speed of broadband,
2017 emphasizes China’s continued demand for foreign mobile phone coverage, quality of electricity supply, or
capital, as recent measures of the Chinese government quality of the transport system,” he said. “I think Hong
have signaled discontent due to increasing capital Kong has tremendous opportunity to be the leader in
outflows caused by fears of the decreasing value of the Smart City developments.” Joachim von Amsberg, Vice
yuan and the decline in China’s GDP growth rate (Beckett President, Policy and Strategy of The Asian Infrastructure
et al.). Investment Bank points out that emerging countries
face the problem of “infrastructure-finance paradox”, in
The Greater Bay Area Initiative which there is a significant demand for infrastructure
but no channel to invest in it. “The paradox is, there is a
The Guangdong – Hong Kong – Macao Greater Bay huge demand for infrastructure in finance,” he explained.
Area Initiative (also known as Greater Pearl River Delta “And on the other hand, you have asset managers sitting
Initiative) is an advanced version of the Pearl River Delta on tens of trillions of dollars. Some of them significantly
74
