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Professor Anthony G.O. Yeh, Chairman Professor of the Department of Urban Planning and Design at the University of Hong Kong, comments on the Policy Address concerning Guangdong-Hong Kong-Macao Greater Bay Area (GBA) development.

Comments on the Chief Executive's 2021 Policy Address

We very much welcome the Chief Executive’s 2021 Policy Address  which is crucial for Hong Kong at this critical time for us to reposition ourselves to get ready for the post-pandemic world. The Chief Executive’s 2021 Policy Address covers most of the policies urgently needed for Hong Kong’s development, and also  zooms in on new opportunities and challenges facing Hong Kong in the last few years. It offers strategic directions and policies to break through the present predicament and seize the valuable opportunities to meet the present and future needs of Hong Kong.

Since the early 1980s, we have been studying urban planning and economic development in the Pearl River Delta (PRD) and Hong Kong, recently with a particular focus on the restructuring and transformation of economic collaboration models between these two places since the 2010s. WE are also exploring the application of smart technologies in developing the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) more efficiently. We welcome the contents of the Chief Executive’s 2021 Policy Address on the Greater Bay Area development. Since the publication of the Outline Development Plan of the Greater Bay Area in 2019, cities in the PRD have fully utilized the opportunities and policies of the Outline Development Planning to move forward quickly. However, we have not much progress.  The Chief Executive’s 2021 Policy Address will move us forward. It is better late than never.

We have the following comments to make on the the  Chief Executive’s 2021 Policy Address.

First, there are opportunities but also challenges in the development of Guangdong-Hong Kong-Macao Greater Bay Area International Technological Innovation Centre of Hong Kong and the Pearl River Delta. Opportunities are mainly reflected in the functional complementarities for innovation-oriented development among Hong Kong and cities in the Pearl River Delta. For instance, Hong Kong enjoys advantages in internationally cutting-edge basic research and high-skilled professional talents. Shenzhen has good technology transfer and transformation capabilities. Dongguan has formed a relatively complete industrial production system while Guangzhou is the gateway for domestic trade and market. However, there are challenges in inefficient cross-border flows of innovation, information flow, and the mismatch between R&D capabilities of Hong Kong and market demands in the PRD and Mainland China. Together with Prof. Tao Zhigang of the Business School and Prof. George Lin of the Department of Geography, we have just completed a Strategic Public Policy Research on “In Search of New Economic Cooperation Models Between Hong Kong and the Greater Bay Area”. Our investigation of  smart technology manufacturing and biomedical high-tech industrial firms in Dongguan and Shenzhen indicates that the cross-border flows of knowledge and technologies between Hong Kong and the Pearl River Delta still highly dependent on intra-firm organizational linkages of Hong Kong firms, and there is a lack of organized cross-border scientific research connections. Domestic enterprises in the Pearl River Delta generally report that it is difficult to know about  Hong Kong's scientific and technological achievements and related information. Therefore, in order to facilitate Mainland businessmen in the Great Bay Area to come to Hong Kong to gain a better understanding of our technological achievements as well as to facilitate  Mainland scholars and researchers to carry out collaborative research with Hong Kong, we should make use of  smart technologies to provide just-in-time business visa and add Greater Bay Area Business and Technology Counters and Channels at the border, for promoting the development of the Guangdong-Hong Kong-Macao Greater Bay Area International Technological Innovation Centre quickly.

Second, we should be aware of the emerging decoupling between Hong Kong producer services and demands of industrial upgrading in the Pearl River Delta. As Hong Kong is dominated by the service economy, producer services are the keys for Hong Kong’s economic competitiveness and external collaboration. The Pearl River Delta has started a new round of industrial transformation since 2005, focusing on the development of high-tech and high value added industries, such as the upgrading of R&D, finance, and marketing.   Hence, Hong Kong's producer service industry needs to closely follow the needs of industrial upgrading in the PRD and maintain its competitive advantages for sustainable and coordinated development of Hong Kong and the GBA. However, our research found that although Hong Kong-funded high-tech manufacturing companies in the Pearl River Delta still tend to use Hong Kong's productive services, especially financial and trade services, domestic and other foreign-funded high-tech manufacturing companies have begun to reduce the use of Hong Kong's productive services. The main reasons are: (1) Since 2018, the quality and capabilities of Shenzhen and Guangzhou's producer services have been significantly improved, especially in the dealing with international business and less expensive than HK services; (2) The negative impact of Hong Kong social movement in 2019 and the closure of the border because of covid-19 have blocked business flow. Therefore, we need to consolidate and enhance Hong Kong's status as an international financial, trade and logistic centre under the "One Country, Two Systems" and  reopen the border with the PRD to restore business interactions with the GBA and rebuild Hong Kong's reputation as soon as possible;

Anthony G.O. Yeh
Department of Urban Planning and Design
The University of Hong Kong
Chair Professor