Page 74 - 2019 White Paper on the Business Environment in China
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9 White Paper on the Business Environment in China
There are, however, still doubts about how well the upgrade imperative.” The BRI should be able to elicit
administrations of Hong Kong, Macao, and Guangdong the second wave of investment for trade and services
can integrate due to differing tax tariffs, currencies, after infrastructure and construction. The Guangdong
and legal and political systems. Alfred Wu, an associate province can bank on its niche in manufacturing and
professor from the National University of Singapore, innovation to export high-end technology goods and
said he thought the Greater Bay Area plan looked “very services to B&R economies. The number of high-tech
superficial and symbolic”. But he said it appeared China companies in Guangzhou was expected to surpass
was sending a signal to its biggest rival — the US— that 10,000 by the end of 2018, up from 8,690 at the end 2017,
it was catching up in terms of economic clout. Wu added said Wang Dong, deputy mayor of Guangzhou. Carrie
he “doubted” Beijing could execute the GBA like San Lam Cheng Yuet-ngor, chief executive of the Hong Kong
Francisco did because the three regions had different laws Special Administrative Region, said Hong Kong can make
and tax systems. The reason why Tokyo, San Francisco important contributions to the GBA not only in creativity,
and New York bay areas were successful was because but also in connections. Lam said, “The principle of ‘One
they were developed under the same legal system and Country, Two Systems’ is itself an innovation to become a
had similar incentives to be connected. Wu said it was unique advantage of the GBA.” Hong Kong can introduce
also “hard to say” whether the GBA would corrode or international companies into the GBA and assist mainland
enhance the “one country, two systems” principle, given enterprises in going overseas. “We will provide the best
that Hong Kong residents were very “sensitive” about any conditions to facilitate the flow of people, goods, capital
changes related to the principle. A survey conducted by and information and to attract talented professionals,”
the Hong Kong Institute of Asia-Pacific Studies at Chinese she added. In jointly building up the GBA into a tourism
University of Hong Kong from June 2018 showed that destination of the world, Macao will tap its potential in
respondents were uncertain about whether the plan tourism administration and training and cooperate with
would achieve its purpose and possible economic other cities in the area in upgrading tourism services, said
benefits or losses for Hong Kong. The survey found that Leong Vai Tac, secretary for economy and finance of the
only 33.2 percent of the respondents agreed the plan Macao SAR (Yang).
could achieve “complementary advantages” between the
regions, while 16.4 percent didn’t think it could, while In spite of the GBA’s potential drawbacks and
the rest were undecided. “Hong Kong only has 7 million difficulties, a report from real estate consulting firm CBRE
people, so their thinking can be [much more small scale],” claims the GBA could be the largest economy among
Dr. Wu said. And while the plan aims to create more global bay areas by 2020, as Hong Kong is expected to
employment opportunities for people in Hong Kong, it be more attractive to firms and capital from the Chinese
could also ultimately dilute the identities of the individual mainland will be promoted. The GBA has three growth
cities, he added (Xiao and Zhou). poles, including Shenzhen, Guangzhou and Hong Kong,
with advantages in scientific innovation, trade, logistics,
Investment Opportunities finance and services, and it also covers cities with strong
manufacturing power in the Pearl River Delta. As the
Policy support, institutional innovation, regional development plan is implemented, population inflow
cooperation and market-driven forces are crucial for will increase, technology and industry will be upgraded
success. Though the region is endowed with institutional and large-scale infrastructure investment will create new
diversity, it has an industry structure that is geared investment opportunities in real estate in the area. There
toward manufacturing. Though upgrade of the industrial is still a gap between the GBA and other international bay
infrastructure is continuing, other aspects like division areas in real estate development, said Li Ling, a managing
of labor among all the cities and a deeper analysis of director of investment and capital market sector at CBRE
how to realize the region’s innovative potential are also China. The space of high-quality office buildings at
necessary. Deloitte China Chief Economist Xu Sitao the GBA was 32 million square meters in 2017, 40 and
said, “The GBA, with its compelling advantages such as 55 percent lower than the New York Bay Area and the
a strong atmosphere of innovation and technology as Tokyo Bay Area respectively. As the economy growth and
well as a strong telecommunication industry, would help structure transformation continues in the GBA, demand
China move up the value chain of the manufacturing for office buildings will surge. High-end business will
industry whose global market share is already very high; continue to gather in core cities that will boost office
in fact, such high market share has made manufacturing building investment in Guangzhou, Shenzhen and
74
There are, however, still doubts about how well the upgrade imperative.” The BRI should be able to elicit
administrations of Hong Kong, Macao, and Guangdong the second wave of investment for trade and services
can integrate due to differing tax tariffs, currencies, after infrastructure and construction. The Guangdong
and legal and political systems. Alfred Wu, an associate province can bank on its niche in manufacturing and
professor from the National University of Singapore, innovation to export high-end technology goods and
said he thought the Greater Bay Area plan looked “very services to B&R economies. The number of high-tech
superficial and symbolic”. But he said it appeared China companies in Guangzhou was expected to surpass
was sending a signal to its biggest rival — the US— that 10,000 by the end of 2018, up from 8,690 at the end 2017,
it was catching up in terms of economic clout. Wu added said Wang Dong, deputy mayor of Guangzhou. Carrie
he “doubted” Beijing could execute the GBA like San Lam Cheng Yuet-ngor, chief executive of the Hong Kong
Francisco did because the three regions had different laws Special Administrative Region, said Hong Kong can make
and tax systems. The reason why Tokyo, San Francisco important contributions to the GBA not only in creativity,
and New York bay areas were successful was because but also in connections. Lam said, “The principle of ‘One
they were developed under the same legal system and Country, Two Systems’ is itself an innovation to become a
had similar incentives to be connected. Wu said it was unique advantage of the GBA.” Hong Kong can introduce
also “hard to say” whether the GBA would corrode or international companies into the GBA and assist mainland
enhance the “one country, two systems” principle, given enterprises in going overseas. “We will provide the best
that Hong Kong residents were very “sensitive” about any conditions to facilitate the flow of people, goods, capital
changes related to the principle. A survey conducted by and information and to attract talented professionals,”
the Hong Kong Institute of Asia-Pacific Studies at Chinese she added. In jointly building up the GBA into a tourism
University of Hong Kong from June 2018 showed that destination of the world, Macao will tap its potential in
respondents were uncertain about whether the plan tourism administration and training and cooperate with
would achieve its purpose and possible economic other cities in the area in upgrading tourism services, said
benefits or losses for Hong Kong. The survey found that Leong Vai Tac, secretary for economy and finance of the
only 33.2 percent of the respondents agreed the plan Macao SAR (Yang).
could achieve “complementary advantages” between the
regions, while 16.4 percent didn’t think it could, while In spite of the GBA’s potential drawbacks and
the rest were undecided. “Hong Kong only has 7 million difficulties, a report from real estate consulting firm CBRE
people, so their thinking can be [much more small scale],” claims the GBA could be the largest economy among
Dr. Wu said. And while the plan aims to create more global bay areas by 2020, as Hong Kong is expected to
employment opportunities for people in Hong Kong, it be more attractive to firms and capital from the Chinese
could also ultimately dilute the identities of the individual mainland will be promoted. The GBA has three growth
cities, he added (Xiao and Zhou). poles, including Shenzhen, Guangzhou and Hong Kong,
with advantages in scientific innovation, trade, logistics,
Investment Opportunities finance and services, and it also covers cities with strong
manufacturing power in the Pearl River Delta. As the
Policy support, institutional innovation, regional development plan is implemented, population inflow
cooperation and market-driven forces are crucial for will increase, technology and industry will be upgraded
success. Though the region is endowed with institutional and large-scale infrastructure investment will create new
diversity, it has an industry structure that is geared investment opportunities in real estate in the area. There
toward manufacturing. Though upgrade of the industrial is still a gap between the GBA and other international bay
infrastructure is continuing, other aspects like division areas in real estate development, said Li Ling, a managing
of labor among all the cities and a deeper analysis of director of investment and capital market sector at CBRE
how to realize the region’s innovative potential are also China. The space of high-quality office buildings at
necessary. Deloitte China Chief Economist Xu Sitao the GBA was 32 million square meters in 2017, 40 and
said, “The GBA, with its compelling advantages such as 55 percent lower than the New York Bay Area and the
a strong atmosphere of innovation and technology as Tokyo Bay Area respectively. As the economy growth and
well as a strong telecommunication industry, would help structure transformation continues in the GBA, demand
China move up the value chain of the manufacturing for office buildings will surge. High-end business will
industry whose global market share is already very high; continue to gather in core cities that will boost office
in fact, such high market share has made manufacturing building investment in Guangzhou, Shenzhen and
74
