Dr Jonathan CHOI Koon-shum (Chairman of the 50th terms of office) January 2017
I hope that all sectors of the society can concentrate on economic development and improving people’s livelihood in the coming year. We must put in more concrete efforts to promote Hong Kong’s long-term development instead of wasting energy on political and internal disputes that will stagnate Hong Kong’s economic development.
In the past year, Hong Kong’s business environment was inevitably affected by the increasing downward pressure on the economy, continuing social conflicts and rising operating costs. In the new year, I look forward to: a new prospect for Hong Kong’s economy; lesser disputes among members of various sectors; more focus on economic development and livelihood improvement; more efforts to improve the business environment and enhance competitiveness; more joint efforts to cope with external challenges; seizing new opportunities arising from China’s new round of reform and “the Belt and Road” Initiative; and particularly strengthening interactive cooperation among Guangdong, Hong Kong and the ASEAN region to explore developing a land-based economic belt in order to inject new impetus into economic growth.
Challenging business environment
Last year, Hong Kong’s key industries such as foreign trade, tourism and retailing performed poorly, with overall exports continuing to shrink in the first half and only slightly stabilized in the third quarter of the year. In the first 11 months, visitor arrivals to Hong Kong contracted by 5.4% on a yearly basis, with visitors from the Mainland decreased by 7.8%. As of November, the total value of retail sales recorded a 21st consecutive month of decline. This year, many uncertainties are expected to remain on the global political and economic front: a new US president assuming office, the UK kicking off Brexit, and fluctuating global interest rates and currency exchange rates. These factors will add uncertainties to business operations and investment.
To cope with the changing business environment, I hope that the HKSAR Government will continue to give strong support to businesses in the areas of finance and taxation, including relaxing the SME subsidy and application requirements, streamlining the application procedures, shortening the processing time, and helping SMEs reduce operating expenses.
In addition, many industrial, commercial and labour issues attracted much public concern last year. Policies such as abolition of the MPF hedging mechanism and legislation of standard working hours aroused extensive discussion as they have far-reaching impact on business expenses and the harmony of labour relations. The HKSAR Government must exercise prudence to balance the legitimate rights and interests of both employers and employees, steering the labour policy in a direction that is in Hong Kong’s overall interests to jointly create a stable business environment and open up more job opportunities.
Tapping new opportunities arising from regional cooperation
With “the Belt and Road” Initiative in full swing, as an important foothold of the 21st Century Maritime Silk Road, Hong Kong can become a key driving force for promoting Hong Kong and the region’s economic development in the coming year by strengthening its ties with next-door Guangdong and neighbouring ASEAN countries.
Hong Kong and Guangdong can especially build on their respective strengths in the financial sector. Hong Kong can capitalize on its advantages as an international financial centre and IPO market. Guangdong can combine its Free Trade Zone (FTZ)’s open development of two-way cross-border RMB business, and further expansion of the linkage between the capital markets of the two places via the Shenzhen-Hong Kong Stock Connect Scheme, to gather more domestic and foreign funds to support the development of “the Belt and Road” Initiative projects. Both places can also use the Guangdong FTZ as a platform to strengthen the alignment of each other’s professional service standards and industry management and speed up the implementation of mutual recognition of professional qualifications in order to provide a wide range of professional services to support “the Belt and Road” Initiative. In the long run, they can gradually develop the Guangdong-Hong Kong-Macao Big Bay Area and build a strategic development hub for the “the Belt and Road” Initiative by promoting close co-operation, complementary advantages and non-duplication of development among the major urban agglomerations in the Pearl River Delta region, as well as further connecting with ASEAN.
I also hope that the Hong Kong-ASEAN Free Trade Agreement will come into fruition as soon as possible so that Hong Kong enterprises can enter the ASEAN market on better terms, which will not only enhance the competitiveness of Hong Kong enterprises in the region, but also play a greater role in promoting cooperation among Guangdong, Hong Kong and ASEAN.
Building a harmonious and stable Hong Kong
Besides the challenges facing the economy, there have been many disputes in Hong Kong over the past few years. The Occupy Central movement, filibustering at the Legislative Council and violent incidents in Mong Kok have not only affected the operation of the HKSAR Government and the Legislative Council, but also undermined social order and stifled economic and business development. The recent oath-taking debacle at the Legislative Council and advocacy of Hong Kong independence have seriously violated the country’s constitution, contradicted the Basic Law, and endangered national unity and territorial integrity. I absolutely agree that the HKSAR Government must strictly deal with them according to the law so as to restore order in Hong Kong as quickly as possible.
I hope that all sectors of the society can concentrate on economic development and improving people’s livelihood in the coming year. We must put in more concrete efforts to promote Hong Kong’s long-term development instead of wasting energy on political and internal disputes that will stagnate Hong Kong’s economic development. I also hope that, in March this year, the new Election Committee will elect a new Chief Executive who loves the country and Hong Kong and will strive to safeguard the “one country, two systems” principle, resolutely curb Hong Kong independence, and genuinely make concrete efforts for the well-being of the public, thus creating a better future for Hong Kong.
In summary, there will be uncertainties as well as opportunities in 2017. In the new year, I sincerely hope that the business community and society will unite and communicate rationally in order to put the focus back on economic development and livelihood improvement by actively participating in the country’s opening up and capturing new opportunities arising from regional economic cooperation.