Chief Executive Carrie Lam
This is an auspicious year for Hong Kong as we are celebrating the 20th anniversary of the establishment of the Hong Kong Special Administrative Region. Over the past 20 years, we have seen increasing economic integration with the Mainland of China. This has brought, and will continue to bring, heightened opportunities to us. This is also a special year for Hong Kong and the ASEAN, especially in the context of a more progressive strategy to strengthen Hong Kong’s relationship with Southeast Asia. Apart from signing the Hong Kong-ASEAN FTA (Free Trade Agreement), we opened our second Economic & Trade Office in ASEAN situated in Jakarta, Indonesia, earlier this year (hitherto, our first and only representation in the entire ASEAN region used to be just Singapore) and in my maiden Policy Address delivered last month, I announced the setting up of a third office in Bangkok, Thailand. Since taking office on July 1, I have already visited four ASEAN nations – Singapore, Thailand, Myanmar and Vietnam, to call on leaders, to renew ties and to explore further co-operation.
Two important events have also taken place earlier this year which put Asia on the spotlight. China hosted the first heavyweight Belt & Road Summit in Beijing in May while the APEC Economic Leaders gathered in Da Nang, Vietnam, in November to discuss issues of mutual concern. Indeed, the Asian perspectives are becoming increasingly important for practical reasons. For the past 25 years or so, Asia’s economy has grown by around 6% a year and several countries therein have become economic powerhouses. As a result, the world economy, at least in terms of GDP, is shifting east and south at an extraordinary speed, and many Asian enterprises have emerged not only responding to their domestic populous markets, but also entering the competitive global stage. It is widely expected that Asia will continue to be the engine of global economic growth for the foreseeable future.
Connectivity has long been Hong Kong’s recipe for success. As a global trade, business and tourism centre, Hong Kong’s extensive networks of business and professional links would not be possible without the physical infrastructure to make it happen. Our international airport lies at the heart of Asia and serves as a hub that puts half of the world’s population within a five-hour flight. Our port serves some 500 destinations worldwide. We are well connected by road and rail to Guangdong Province and the Pearl River Delta, which are powerhouses in manufacturing and high-tech industries. These land links will be significantly enhanced as within the next 12 to 18 months, we will commission three major pieces of cross-boundary infrastructure which will significantly transform our links with the Mainland and beyond, accelerating the flow of goods, people, capital and information between Hong Kong and the Mainland. In doing so, they will underscore our status as the region’s trade, business and logistics hub, boosting opportunities for Hong Kong and for the companies that partner with Hong Kong.
First is the Hong Kong-Zhuhai-Macao Bridge, the world’s longest combined sub-sea tunnel and bridge, which will cut journey time between the Hong Kong International Airport and Zhuhai or Macao from four hours to about 45 minutes, accelerating our economic integration with the western Pearl River Delta region. Indeed, most of the Pearl River Delta’s major cities will be reachable within a three-hour drive.
Second is the 26km Hong Kong section of the Express Rail Link which will slash journey time between Guangzhou and Hong Kong, on a non-stop basis, to just 48 minutes. No less important, it will connect Hong Kong to our country’s national rail network and its 22,000km of high-speed track.
Third is a new border crossing, our seventh land boundary control point, which will greatly enhance the connection between Hong Kong and the eastern part of Shenzhen, Huizhou and all the way to the Fujian Province.
Increased connections will mean new development opportunities for Hong Kong. Our enhanced connectivity will be particularly valuable to Hong Kong as the Belt & Road Initiative and the Guangdong-Hong Kong-Macao Bay Area development gain traction.
The bay area, which counts nine Guangdong cities, along with Macao and Hong Kong, is China’s most affluent region. The bay area will allow us to draw on the combined strengths of the participating cities and their 66 million inhabitants, bringing immense prospects to Hong Kong and our trading partners.
The twin corridors of the Belt & Road are home to more than 60 economies in the three continents of Asia, Europe and Africa. As President Xi Jinping said at the APEC CEO Summit earlier this month, the Belt & Road Initiative is from China, but it belongs to the world; it is rooted in history, but oriented towards the future. It will enhance not only connectivity in trade, but also interconnected development in infrastructure, policies, financial services and people-to-people bond.
As a founding member of the World Trade Organization, Hong Kong is a staunch supporter of free trade. For 23 years in a row, we have been ranked as the world’s freest economy by the Heritage Foundation. Free and open economy, well connected to the outside world, underpins Hong Kong’s prosperity. We have benefitted immensely from free trade which is instrumental in developing Hong Kong into an international trade and business centre as it is today. We shall continue to enhance connectivity and achieve interconnected development.
However, despite all the benefits free trade and connected development can bring, we do see recently some worrying signs of rising protectionism. Why would this happen? One reason could be that the gains brought by economic globalisation have not been enjoyed by all, giving rise to social discontent, income disparity and a growing sense of disconnect, especially between the government and the people, particularly young people. It is tempting to blame free trade for such social problems, and protectionism may easily gain popularity, but the fundamental solution lies in making economic development more inclusive and delivering benefits to our people.
Inclusive growth is highly relevant in the age of globalisation. Economies in Asia must redouble their efforts to advance economic, financial and social inclusion, with a vision to build an inclusive, accessible, sustainable, healthy and resilient community. As a government, we must advance progress towards achieving full, productive and quality employment; and progressively achieve and sustain income growth for all members of society, especially women, and youth, persons with disabilities and other vulnerable groups, and enable them to seize global opportunities.
Building an inclusive community is, and will continue to be my Government’s priority. In this respect, it is relevant to note that some 60% of our recurrent budget is spent on education, social welfare and medical services; spending on social welfare and poverty alleviation has surged by 71% in the past five years with a range of initiatives pioneered by the Commission on Poverty which I chaired in my former capacity as the Chief Secretary for Administration. We will continue to enhance the standard of living of all members of the community, so that they can feel the benefits brought by free trade and economic growth.
A greater concern for the natural environment and a commitment to sustainable growth should, in my view, be another important dimension of Asia trade. As responsible global citizens, we must actively tackle climate change, improve air and water quality and reduce waste.
Hong Kong is able to benefit from connected, inclusive and sustainable growth in the past 20 years under “one country, two systems”. We enjoy unique advantages under “one country, two systems”. We are an international financial centre and are universally acknowledged as among the best cities in the world for doing business. Our fibre network, capable of carrying high-speed broadband, covers the entire city. Our legal and professional services are highly regarded. And it’s all underpinned by the rule of law, an independent judiciary and rights and freedoms guaranteed under the Basic Law.
Hong Kong’s longstanding prowess in trade, coupled with our financial, legal and administrative expertise, and experience, can play a pivotal role in Asia trade in the new global order. Indeed, in the latest WTO survey, Hong Kong is the world’s sixth-largest exporter of merchandise trade and 15th largest commercial services exporter. We are world-class importers as well, ranking seventh in goods and 17th in services. We trade with more than 200 countries and regions, creating opportunities for millions upon millions of people.
But there is no room for complacency. In taking Hong Kong’s economy forward, I said in my Policy Address that we will continue to respect the rules governing the economy and market operations, and promote free trade. At the same time, we will leverage our unique advantages under “one country, two systems”. We will inject new and continuous impetus to Hong Kong’s economy through playing new roles of facilitation and promotion and making timely investments. We will conduct more government-to-government dialogues with the Mainland and overseas countries.
Chief Executive Carrie Lam gave these remarks at the Asia House Signature Conference on November 27.
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