San Francisco and Tokyo should watch out: a new metropolitan bay area is hot on their heels. Leveraging its status as a global financial, transportation and trade hub, Hong Kong is playing a central role in China’s grand plan to develop a Greater Bay Area rivalling its more famous American and Japanese counterparts.
While many cities aspire to be labelled a ‘smart city’ or ‘future city’, Hong Kong has always been a metropolis that’s kept a close watch on what’s in store for the future. During the two decades before mainland China started to raise the bamboo curtain in the late 1970s and subsequently established its reputation as the world’s factory, the ‘Made in Hong Kong’ brand supplied the world with low-cost toys, textiles and electronic products. By the end of the 20th century, however, Hong Kong had closed the toy box lid on producing cheap toys, electrical gadgets and garments, and successfully made the transition to a service-led economy, firmly establishing itself as one of the world’s major international financial centres.
At the crossroads between East and West
Meanwhile, throughout numerous political upheavals, business uncertainties and from its strategic location perched on China’s southern tip, Hong Kong has always played a pivotal role as a strategic East-meets-West gateway. The city constitutes a crucial financial and business intersection between mainland China and the rest of the world. And thanks to its international outlook with strong links to global economic and business markets, Hong Kong’s future is being strategically positioned.
9+2=15th largest economy in the world
In mid-February 2019, the Chinese government unveiled the Greater Bay Area (GBA) blueprint: an ambitious plan to integrate the flows of people, goods, capital and information between Hong Kong, Macau and nine cities of the Guangdong province to rival the world’s better known bay areas. Often dubbed the ‘9+2 cities’, the GBA comprises Shenzhen, Guangzhou, Foshan, Dongguan, Zhuhai, Zhongshan, Huizhou, Zhaoqing and Jiangmen in Guangdong province, – plus Hong Kong and Macau.
Described as the Bay Area – although to be geographically correct, the GBA is a delta rather than a bay – at about 56 000 square kilometres, it is larger than Tokyo Bay, and more than twice the size of the New York Metropolitan and San Francisco Bay areas. With a population of close to 70 million and a total GDP of USD 1.53 trillion (similar to that of Russia and slightly larger than Australia), if the GBA were a country, it would have the 15th largest economy in the world.
If the GBA were a country, it would have the 15th largest economy in the world.
The GBA’s ‘grand plan’ plays to some of Hong Kong’s unique advantages. For example, while the 9+2 cities each have their own strengths, Hong Kong is by far the most international in its business outlook and global cultural integration. The GBA blueprint outlines the role of each partner city, covering the period from now until 2022 in the immediate term and extending to 2035 in the long term. In this scenario, the future looks bright for Hong Kong. Home to about 70 of the top 100 global banks, the city will leverage its edge in international finance, professional services and aviation.
Laying the foundation for Hong Kong’s future success
While concerns have been raised that Hong Kong, with its population of roughly 7.5 million, might be absorbed into the vast mainland China hinterland and become just another Chinese city, Hong Kong Chief Executive Carrie Lam Cheng Yuet-ngor is pinning high hopes on the Bay Area’s contribution to Hong Kong’s future success. She cites Hong Kong’s economic freedoms, the rule of law and an independent judiciary, its favourable tax environment and the overall ease of conducting business in the city as unique lynchpins and key differentiators. Leveraging on these pillars, Lam says Hong Kong is in a prime position to transition once again, this time into a regional mega-city with greater capacity for growth. “Beijing has invited us not only to build closer links with the region, but also to play a role in shaping it,” Lam said in response to criticism during a legislative debate. “What kind of foolishness would persuade us not to take maximum advantage of such an invitation?” she added.
Similar to nearly 40 years ago, when Hong Kong entrepreneurs seized the moment when China opened for business, Hongkongers are being urged to do the same again. Steven Lam Hoi-yuen is one example. The co-founder and chief executive of app-based van hire services GOGOVAN, valued at more than USD 1 billion and Hong Kong’s first start-up to join the global billion dollar ‘Unicorn’ club, believes the GBA plan has presented a wide opening for Hong Kong’s young people. “Young people need to be more open-minded about embracing China’s developing economic power and flex their muscles in the Bay Area,” Lam said during a panel discussion debating Hong Kong’s future. In fact, Hong Kong has always made the most of its proximity to mainland China: during the 1980s and 1990s when the city was still under British rule, countless small and medium-sized enterprises – the bedrock of Hong Kong’s economy – scaled up rapidly by taking advantage of manufacturing capacity on the other side of the border.
Connecting businesses, entrepreneurs and academics
With an eye on the future, decades of investment in modernisation have enabled Hong Kong to develop a world-leading urban transport network that accommodates more than 12 million trips by public transport per day. In preparation for its role as a key GBA city, Hong Kong’s transportation systems have been dramatically expanded. The 55 kilometre Hong Kong-Zhuhai-Macau mega bridge and the Guangzhou-Shenzhen-Hong Kong Express Rail Link – connecting Hong Kong with the 25 000-kilometre National High-Speed Rail – were completed and opened in 2018 at a combined cost of almost USD 30 billion. The mammoth transportation backbone constitutes the final stages of what is being marketed as one of the most dynamic trading regions in the world.
With convenient to use new rail and road links in place, it is now possible to wake up in Hong Kong, have breakfast in Shenzhen, lunch in Guangzhou, dinner in Zhuhai and return to Hong Kong – all in the same day. Reduced travel time is expected to lead to more exchanges among business experts, entrepreneurs and academics. Charles Ng, Associate Director-General of Invest Hong Kong, the government department tasked with attracting foreign direct investment into the city, believes that the new physical infrastructure and trade facilitation measures will help drive this next cross-border transformation, which promises larger commercial flows, lower costs, higher efficiencies and greater prosperity for the city and region. “All of these developments are conducive to further developing Hong Kong into an international metropolis with enhanced competitiveness,” notes Ng.
New infrastructure also makes it easier for travellers to visit Hong Kong to sample its food, cultural charms and purpose-built entertainment attractions. A proposition that Asia Airbnb Mike Orgill, Airbnb’s general manager for, Southeast Asia, Hong Kong and Taiwan sees as an incentive that will fuel a wave of tourism amongst the rising tide of Chinese travellers looking for authentic experiences. “Easier ways to travel means that more people can get a feel for the real experiences that Hong Kong life can offer,” says Orgill.
Looking ahead, while it remains to be seen how the development of GBA will unfold, with Hong Kong playing its part in the birth of a new hub, the future points towards greater prosperity, livability and opportunities.
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