Exclusive: Hong Kong's role as a bridge and window gains increasing significance, says city's finance secretary
Published: Nov 16, 2023 01:52 AM
Paul Chan Mo-po, Finance Secretary of the Hong Kong Special Administrative Region (HKSAR) government Photo: Chen Qingqing/GT

Paul Chan Mo-po, Finance Secretary of the Hong Kong Special Administrative Region (HKSAR) government Photo: Chen Qingqing/GT

In the future, Hong Kong's role as a "bridge" and "window" will only become more significant, Paul Chan Mo-po, Finance Secretary of the Hong Kong Special Administrative Region (HKSAR) government, told the Global Times in an exclusive interview in San Francisco, where he is currently attending the Asia-Pacific Economic Cooperation (APEC) meetings.

Chan stated that he would introduce Hong Kong to business leaders from the US and other economies during the meetings, encourage them to develop their businesses in Hong Kong, and discuss with them how to collaborate more effectively.

Although Hong Kong's economy is currently facing some challenges, it has a very optimistic long-term development outlook and will play a significant role in the APEC, he told the Global Times in late Tuesday local time.

Addressing the gathering at the Finance Ministers' Retreat in San Francisco on Sunday, hosted by US Secretary of the Treasury Janet Yellen, Chan highlighted that Hong Kong's robust fiscal standing and its low ratio of government debt to gross domestic product empower the region to foster economic growth and advance pivotal industries, according to media reports.

"During my visit, I aim to achieve three goals. First, I want to take advantage of the APEC platform to present the opportunities available in Hong Kong's new stage of development and welcome more partners to collaborate with us," he said.

"Second, I plan to interact with the business community from the US and the Asia-Pacific region to attract investment and expand Hong Kong's network of friends."

"Third, I will visit some local businesses to introduce them to the policies and measures Hong Kong has implemented in recent years to attract talent and enterprises, with the goal of drawing more companies to establish their presence in Hong Kong," he said.

Hong Kong's future development hinges on two main "engines," namely financial services and technology innovation. "Hong Kong has a solid foundation in financial services, with many American financial institutions already thriving in Hong Kong, so this time I focused on the tech innovation field, specifically in areas like artificial intelligence, big data, life and health, fintech, and new energy materials," Chan said.

When some Western countries like the US have many misunderstandings and even prejudices about Hong Kong, claiming "Hong Kong's judiciary is not independent enough" or "freedom in Hong Kong is regressing," the finance secretary believes that there are indeed some misunderstandings about Hong Kong in the US business community.

"In recent years, due to the pandemic, there have been fewer visits to Hong Kong by foreign business communities, and we also went out less," he said.

Therefore, one important thing during this trip to San Francisco is to clarify the advantages of the One Country, Two Systems principle and Hong Kong's long-term determination to implement it, Chan noted.

Under the One Country, Two Systems framework, Hong Kong has advantages in the free flow of currency, capital, talent, goods, and information, he further elaborated.

"In terms of the judiciary, there are foreign judges in Hong Kong's Court of Final Appeal. Sometimes the government wins, and sometimes it loses in our court rulings," he said.

"I will provide many specific examples to illustrate what the commercial and judicial environment is like in Hong Kong and help them understand the true situation. We will also invite them to Hong Kong for actual exchanges with the business community there—seeing is believing."

The three engines of Hong Kong's economic growth are exports, fixed asset investment, and consumption. Currently, it is still quite challenging for Hong Kong in terms of exports, so in the next few months, we need to promote the output of tourism services, that is, to attract more tourists to Hong Kong, Chan noted.

"Now that international flights are gradually resuming, and we are hosting many large-scale events, I believe more tourists will come to Hong Kong and have a good travel experience here," he said.

"In the medium to long term, to promote faster economic growth in Hong Kong, it is essential to leverage Hong Kong's status as the 'eight centers,' especially as a financial center and a tech innovation center," Chan said.

Especially in the field of tech innovation, "attracting enterprises, attracting talent" is a task we have been and will continue to promote with all our efforts. From the end of last December to the end of this September, more than 30 "enterprise partners" have come to Hong Kong, Chan expounded.

"They do not come alone but promise to bring other upstream and downstream companies to establish a vibrant 'ecosystem' and industrial chain. Preliminarily, these 'enterprise partners' will bring an investment of HK$30 billion to Hong Kong and create 10,000 jobs," he said.

"In terms of talent, from last December to now, we have received 180,000 applications for talent import, of which over 110,000 have been approved, and more than 70,000 have already arrived in Hong Kong. These are our future driving forces for growth. And there is great development potential in areas such as green finance, which will be a focus of our future efforts," Chan noted.

In response to some analyses suggesting that there has been a significant outflow of funds from Hong Kong in recent years, the finance secretary said that the bank deposit volume in Hong Kong at the end of last year had a slight increase compared to the end of the previous year, according to the data.

"Money flows in and out; Hong Kong is a place where capital flows freely, and this data also tells us that, in fact, more funds are coming in than going out," he said.

"In terms of trade, there are significant challenges in traditional markets, but we still strive to consolidate them. At the same time, emerging markets like Southeast Asia and the Middle East are growing fast, and these countries have good relations with the Chinese mainland and complementarities with Hong Kong in the industrial chain," Chan noted.

"Therefore, we expect to intensify efforts to promote trade space with Southeast Asian countries. In addition, beyond goods trade, service exports are also vital. For APEC members, Hong Kong remains the preferred international financial center and financing platform, with enormous development potential," he said.

While many observers often suggest that Hong Kong has played the role of a "bridge" between the East and the West, in recent years, with the US revoking the city's special trade status and repeatedly putting pressure on the city for geopolitical reasons, some of them raised doubts about whether the city can still play the role of a "bridge."

Chan affirmed that in the future, Hong Kong's role as a "bridge" and "window" will only become more significant.

"Our country has a large and fast-growing economy with a continuous opening-up policy and a very stable national development strategy. Foreign businesses cannot afford to miss such a market, and naturally, Hong Kong is an excellent springboard, so I am very confident," he said.

On the other hand, mainland enterprises are also going global, and Hong Kong can serve as an "overseas headquarters" for these mainland businesses to develop international operations, he noted.

"Hong Kong's professional services are very mature, and in many fields, we also have standards that are aligned internationally. In addition, we can provide risk management services to mainland enterprises developing international business, becoming their 'risk managers'," he said.

No matter how complex and variable the external environment is, Hong Kong, under the firm support of the One Country, Two Systems and the country, leveraging the talent and experience accumulated over many years, will certainly be able to develop itself well and make more contributions to the nation, Chan said.