Time for bold action
Ningrong Liu says Hong Kong must find its drive again as rivals like Singapore surge ahead
Hong Kong falling out of the world’s top 10 container ports for the first time is a sign of the city’s declining stature. Meanwhile, thriving rival cities such as Shanghai, Singapore and Shenzhen continue to secure top rankings. Also last week, Apple announced a US$250 million expansion in Singapore, bolstering the city state’s position as the region’s leading tech hub.
Hong Kong is grappling with its rivals’ development. During the Easter holiday, Hongkongers made over 1.5 million trips out of the city, mostly crossing the border to dine, play and shop in Shenzhen and elsewhere on the mainland. Hong Kong’s appeal is waning, even for its people.
The growing disparity between Hong Kong and its rival metropolises is cause for concern. Shanghai, with its historical significance and economic might, was once considered Hong Kong’s primary competitor. But Shenzhen has emerged to become a formidable contender. A tiny village in the late 1970s, Shenzhen has made remarkable strides as China’s technology hub, overtaking Hong Kong in economic size in 2018.
Singapore, with its long-standing rivalry with Hong Kong, has also pulled ahead in recent years. Singapore’s gross domestic product per capita is approaching double Hong Kong’s, a testament to its success in overtaking the city as the top financial centre in Asia, ranked third in the world.
As competitors continue to rise, Hong Kong must confront its shortcomings and take action to remain competitive.
Firstly, Hong Kong must undergo a paradigm shift to adapt to the changing dynamics. Where all four metropolises once played catch-up with one another, it is now Hong Kong that needs strategic development and a vision to maintain its competitiveness.
Shanghai aspires to be a global tech hub, focusing on integrated circuits, biomedicine and artificial intelligence. Shenzhen is China’s Silicon Valley, with cutting-edge industrial chains and plans for a world-class science city. Singapore, with its strong government support for innovation and a thriving start-up ecosystem, is Asia’s leading tech and manufacturing hub.
Hong Kong also has tech hub ambitions and the establishment of the Office for Attracting Strategic Enterprises is a commendable step. The office’s goal of reaching out to 300 strategic enterprises this year is ambitious, but its success remains to be seen. The decision by Contemporary Amperex Technology, the global leader in electric vehicle batteries, to set up a research and development centre in Hong Kong is a positive development.
But more efforts are necessary to ensure Hong Kong can genuinely compete. Hong Kong must reassess its strategies to establish itself as a tech hub and be more critical of its own efforts. The city must show clear vision, invest in innovation and create an environment conducive to tech-driven businesses. Support for R&D initiatives, and the encouragement of collaboration between academia, the industry and the government are vital steps in creating an innovative ecosystem.
Secondly, Hong Kong needs to break free from conventional thinking. Unfortunately, it continues to cling on to old strategies and outdated approaches to revive its economy.
The hospitality and tourism sectors, for instance, have taken a massive hit from the pandemic and the emigration wave. Instead of improving its deteriorating services and providing vibrant programmes to attract visitors, Hong Kong appeals to Beijing for help by adding more mainland cities to a solo traveller scheme.
Hong Kong must shed its risk-averse mindset, which hampers creativity and innovation. The city has become too complacent, leading to a culture that favours “no risk, some gains” over “high risk, high gains”.
While the central government’s support for Hong Kong is appreciated, the city must find its unique strengths and reinforce its status as a global financial centre. Hong Kong has the potential to become a cryptocurrency hub by encouraging retail investors to trade in digital tokens.
But it must go beyond and foster the development of Web3 technologies, providing the necessary infrastructure for cryptocurrency advancements. Hong Kong’s current approach is insufficient and it risks falling behind counterparts like Singapore.
Thirdly, Hong Kong must be pragmatic and integrate the best aspects of “two systems” under one country. The city must strike a balance between preserving its unique identity and embracing change and innovation.
While procedural fairness is an important aspect of governance, overemphasising procedure or using it as an excuse to resist change or protect personal interests can be detrimental to progress and accountability. Hong Kong must ensure that procedural fairness is preserved but prolonging decision-making can hinder progress and lead to a lack of action and accountability.
Hong Kong must avoid excessive formalities and bureaucracy, practices that mainland authorities have been trying to combat, and focus on driving change and taking decisive action. Relying solely on systems and procedures without daring to drive change will only lead to laziness, an unwillingness to take action, and ultimately, a loss of a sense of responsibility.
Hong Kong must take ownership of its own fate. The time for complacency and empty rhetoric is over – Hong Kong must act now to secure its future.
The city is in competition against Shanghai, Shenzhen and Singapore. But while it must take this competition seriously, it should also resist the tendency to be obsessed with comparing itself to them, and focus on improving itself.
Hong Kong needs to reassess its strategies, foster innovation and create an environment that encourages risk-taking and entrepreneurship. Only then can it hope to sit secure as a thriving metropolis.
Hong Kong must reassess its strategies to establish itself as a tech hub and be more critical of its own effort