Hong Kong’s strengths in internationalization and market liberalization can help China connect with the rest of the world. In particular, it can play an important role in areas of professional services such as financial investment, logistics, shipping, infrastructure management, legal arbitration and regional trade, which can help the progress of the “Belt and Road Initiative”.
In view of the wave of anti-globalization sentiments in Europe and the US in recent years, which has also started to spread to developing countries, Nicholas Kwan, Director of Research at the Hong Kong Trade Development Council, believes that the “Belt and Road Initiative” is the new direction for future development. He pointed out that the “Belt and Road Initiative” builds an open and mutually beneficial cooperation platform to connect Asia, Europe, Africa and the Middle East. Any countries interested in participating in it can become part of it. Therefore, the “Belt and Road Initiative” is in fact a globalization initiative started in China and its neighboring countries.
Globalization with Chinese characteristics
At present, China is the world’s largest trading nation and is second to none in making and attracting investments. However, Kwan said that there is still room for the Mainland to advance in terms of capital, trade and production. For example, the Mainland’s share of added value in “made in China” products is actually not high. Currently, 60% of the Mainland’s overseas investments are made through Hong Kong, which means it still cannot directly invest overseas like investment powers such as the UK and the US. He added that as global economic powers are moving in the opposite direction, China’s promotion of globalization is a good thing, and Hong Kong can help in the process.
Hong Kong’s commendable professional services
Kwan further pointed out that Hong Kong’s strengths in internationalization and market liberalization can help China connect with the rest of the world. In particular, it can play an important role in areas of professional services such as financial investment, logistics, shipping, infrastructure management, legal arbitration and regional trade.
Kwan believes that Hong Kong’s strength in infrastructure management will be of much help to the numerous infrastructure projects involved in the “Belt and Road Initiative”. He said that Hong Kong’s efficient and cost-effective infrastructure is a testament to its capabilities. Therefore, it can collaborate with Mainland enterprises going forward: it can be arranged such that infrastructure projects are built by Mainland engineering companies while Hong Kong enterprises are involved in monitoring and operating them so that Hong Kong can also participate in the investment space of the Mainland’s “going global”.
In addition, as Hong Kong has a sound financial and monetary system and is also an internationally recognized third-party legal provider, it can attract global financial institutions to locate here. Hong Kong is also the world’s largest IPO financing center and offshore RMB center, as well as the region’s second largest asset management and private equity fund center. Therefore, it has important capabilities to promote major cross-border investments in the world, providing a strong financial service support for the “Belt and Road Initiative” infrastructure projects.
A bridge to connect the world
Hong Kong is a free port where goods, capital, personnel and information can flow freely. Supported by a sound regional business network, Hong Kong can further consolidate its unique strengths to connect the world and promote regional cooperation in addition to being a “super connector” to serve as a bridge between the Mainland and the rest of the international community to jointly promote the “Belt and Road Initiative”, which is indeed an unprecedented global cooperation initiative.
