Qianhai will help SAR integrate into nation

The Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone, as a pilot platform for Shenzhen-Hong Kong cooperation, has been playing an important role in facilitating Hong Kong professionals’ foray into the Chinese mainland market as well as business cooperation between the mainland and Hong Kong over the years. The Central Committee of the Communist Party of China and the State Council recently issued and distributed the “Plan for Comprehensively Deepening Reform and Opening-up of the Qianhai MSIC Zone”, providing further guidance and opportunities for Hong Kong to expand and deepen innovative cooperation with Shenzhen in the years to come. That is why the plan deserves the full attention and understanding of Hong Kong society.

The Qianhai zone was not built in a day. Since the State Council approved the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone Overall Development Plan on Aug 26, 2010, it has been taking shape while serving its purpose with remarkable results. In the past 11 years, Qianhai has implemented 645 institutional innovations designed to make investment and trade more convenient while enhancing financial services opening-up and innovation. For example, Qianhai is the first to pursue closer professional cooperation between the mainland and Hong Kong in legal counsel services and explore ways to conduct the joint practice of mainland and Hong Kong law firms in Qianhai. The zone also expanded the application of Hong Kong construction standards to all projects solely funded by Hong Kong investors.

The new plan for “comprehensive and deeper” reform for Qianhai will significantly boost not only Shenzhen-Hong Kong cooperation but also the development of the Guangdong-Hong Kong-Macao Greater Bay Area, and the integration of Hong Kong’s own development into the overall development strategy of the nation.

First, the new plan will expand the physical area of the Qianhai zone from about 15 square kilometers to 120.56 square kilometers, an eightfold increase that will translate into much more room for cooperation and innovation. Previously, some innovative practices did not have a significant impact outside the zone because of its small size, such as the cross-border issuance of yuan loans, which will no doubt draw wider interest after the area’s expansion. A bigger area will also accommodate more cooperation projects, especially those in which Hong Kong boasts more expertise and experience. For instance, the “Convention and Exhibition City” that Shenzhen plans to build in Qianhai will benefit a lot from Hong Kong’s rich experience in the conventions and exhibitions industry. The same can be said about Shenzhen-Hong Kong cooperation in developing an international aviation hub with Hong Kong’s expertise and global reach to boost air transportation development in both cities.

Second, since the central government approved the Qianhai zone development plan 11 years ago, the flow of talent from both the mainland and Hong Kong has been a main feature of the cooperation and innovation pilot platform, particularly in crossborder modern services, including but not limited to finance, legal counsel and other high-end professional services. According to the new development plan, Qianhai will be “a special zone within a special economic zone” implementing more institutional innovations under its role as a testing ground. Hong Kong boasts many world-class professionals who would thrive on the mainland if there were adequate support and facilitating mechanisms for them to apply their skills up north.

Last but not least, the deeper reform and opening-up plan is not limited to ShenzhenHong Kong cooperation in Qianhai. Of the 645 institutional innovations implemented in Qianhai so far, 165 have been applied throughout Shenzhen municipality, 82 across Guangdong province and 58 across the country. Apparently, the positioning of Qianhai has been a cooperation platform for Hong Kong to integrate its own development into the overall development strategy of the country. Under the “dual circulation” development model of the country, Qianhai can and should serve as a link between internal and external circulations through modern service industry cooperation and innovation between Shenzhen and Hong Kong, whose global connections will come in handy in such pursuits, particularly in introducing new foreign products and technology to the mainland as well as external investments for deeper reform and opening-up there.

The significance of Qianhai moving forward is much more than Shenzhen-Hong Kong cooperation in modern service industry development. It will facilitate Hong Kong’s efforts to better integrate its own development into the overall development strategy of the country to achieve common prosperity for the whole Chinese nation.