East Asia has witnessed spectacular economic growth in recent years and has gradually become a key driver of global economic growth. By proactively responding to the opportunities and challenges presented by these emerging trends, Hong Kong will help to lead the East Asian economy towards deeper and more comprehensive development cooperation, while optimising Hong Kong’s unique functional role.
Carrie Lam: CEPA puts Hong Kong in touch with Mainland and global trends
Carrie Lam, the Chief Executive of the HKSAR, commented that as Hong Kong’s relationship with ASEAN has grown closer, the ASEAN group of countries has already become Hong Kong’s second largest commodity trade partner. She mentioned that as a gateway to the Mainland, Hong Kong has consistently strived to promote cooperation between China and ASEAN, and that 12% of trade between ASEAN nations and China was conducted via Hong Kong.
Lam believes that ASEAN nations also stand to benefit from the Chinese government’s “Belt and Road” (B&R) initiative, which will further promote mutual cooperation and economic growth. Hong Kong is ideally positioned to take advantage of the Closer Economic Partnership Arrangement (CEPA) to play a unique role within the B&R and exploit its special advantages in sectors including the service industry and customs duty for products, while CEPA will also become one of the main channels connecting the territory with both Chinese and foreign companies.
Lam stressed that Hong Kong is currently working to expedite a free trade agreement with ASEAN that will strengthen economic contacts in terms of goods, services and investment. Once the state and the Hong Kong government has completed free trade agreements with ASEAN, these agreements, along with CEPA, will form a strong platform to promote trade and investment between Hong Kong and ASEAN nations.
Fu Ziying: B&R will build a platform for cooperation across East Asia
Fu Ziying, China International Trade Representative (Ministerial Level) and Vice-Minister of Commerce of China, pointed out that Asia is one of the world’s most dynamic regions in terms of economic growth, with trade and investment cooperation becoming ever closer. Cooperation within the East Asia region has broadened from initial integration within ASEAN to a range of partnerships between ASEAN and other economies. The B&R initiative will operate in partnership with the ASEAN 2025: Forging Ahead Together strategic plan to provide a platform for high-level cooperation across the East Asia region.
Participating in East Asian regional cooperation is vital to create a situation of mutual benefit for all parties. Turning to the issue of Hong Kong’s role, Fu believes that as a major economic partner for many East Asian nations, Hong Kong has an important role to play in terms of financial platforms, transport logistics hubs, trade logistics centres, and specialist service platforms. He emphasised that the central government is actively supporting Hong Kong’s major role in the building of B&R through the CEPA Investment Agreement and the CEPA Economic and Technological Cooperation Agreement.
Ramon M Lopez: RCEP is the key to global economic integration
Ramon M Lopez, Secretary of Trade and Industry of the Philippines, noted that as ASEAN currently has the highest economic growth of any region, the need to further strengthen trade partnerships made the creation of the ASEAN Economic Community (AEC) a vital step. International trends have shifted rapidly in recent years, with the Trans-Pacific Partnership (TPP) losing the US and the EU losing the UK; against this background, the creation of the Regional Comprehensive Economic Partnership (RCEP) not only brings about new opportunities for economies within the region, but also represents the only chance for global economic integration.
Lopez believes that while East Asian nations are undoubtedly engaged in competition in almost every area, their diverse economies also complement each other to a large extent. Consumers prefer new products and welcome competitive markets. By differentiating products and achieving mutually complementary arrangements with other economies in terms of production, these different economies can avoid vicious competition while creating a wider range of product choices for consumers.
Lopez also noted that SMEs and micro-enterprises are indispensable parts of economic development. For this reason, large enterprises should consider how to incorporate these smaller players into the value chain, strengthen the synergy between them, and increase and encourage technology transfers, which is the way to create greater value.
Apiradi Tantraporn: Linking the EEC to B&R
Apiradi Tantraporn, Minister of Commerce of Thailand, expects that the Hong Kong-ASEAN Free Trade Agreement will be in place this September. She believes that the agreement between Hong Kong and ASEAN will complement the China-ASEAN Free Trade Agreement, making trade and investment arrangements more complete and allowing all participating countries to benefit.
Tantraporn indicated that B&R is an important economic platform in which Thailand occupies a key strategic location. The Eastern Economic Corridor (EEC) covers Thailand’s three easternmost provinces, where local governments are building a number of new ports to cater for shipping requirements; the Thai government is also building new international commercial airports and high-speed rail links, providing comprehensive infrastructure upgrades that will promote closer contacts with the surrounding regions.
With regard to the relationship between Hong Kong and Thailand, she believes that Hong Kong and Thailand are gateways to the China and ASEAN markets, and as such, ASEAN’s AEC and RCEP initiatives are vital points of entry that will deliver boundless opportunities for Hong Kong in the future.
Sorasak Pan: RCEP, AEC and B&R will jointly promote regional development
Regarding regional cooperation within East Asia, Sorasak Pan, Minister of Commerce of Cambodia, commented that East Asia has successfully weathered the financial crisis and is now striving to achieve successful cooperation within the region.
In terms of future areas of cooperation, Pan believes that there are three key opportunities within the region. The proposal for RCEP in 2012 promoted free trade covering the ASEAN region plus China, Korea, Japan, Australia, New Zealand and India. He described the AEC as a bold step towards the creation of a platform for regional economic integration with a clear and ambitious blueprint for strengthening links, cooperation, collaboration and globalization; the AEC will transform the ASEAN region into a more closely integrated, synergistic and competitive economy.
He also commented that the goals of the B&R initiative proposed by China are to increase contacts between Asia, Africa and Europe and create a vast potential market with huge benefits for employment and investment; as such, B&R is particularly meaningful to regional cooperation within East Asia.
Cao Quoc Hung: East Asian cooperation will benefit the global economy
Cao Quoc Hung, Vice Minister of Industry and Trade of Vietnam, noted that the Asia region has undergone huge changes in recent years, with cooperation between China, Hong Kong and the ASEAN nations becoming increasingly frequent. The increasing importance of East Asia to the global economy will produce a domino effect that will drive global economic growth.
Vietnam’s economy has seen steady growth over the last few years, and as Cao noted, the plentiful supply of labour and flourishing consumer market is giving the country an increasingly important role in regional cooperation within East Asia. He forecasts that free trade agreements such as those signed with Korea, Australia and the EU will deliver more open markets and mutual investment, as well as greater willingness to cooperate in terms of the rule of law and the promotion of partnerships in areas including commerce, investment, trade and the economy.
Cao is also convinced that Kong Hong has a role to play in the RCEP in terms of trade and investment, and as a key point of contact between China and ASEAN, the territory will contribute to increased cooperation and growth within the region.
Koh Poh Koon: Hong Kong and Singapore are jointly building bridges between China and ASEAN
As Singapore and Hong Kong are both members of the “Four Asian Tigers”, Koh Poh Koon, Senior Minister of State, Ministry of Trade and Industry & Ministry of National Development of Singapore, believes that although it is inevitable that the two regions are economic competitors, they also share a number of similarities. Singapore is located in the heart of Asia and the ASEAN area while Hong Kong is the gateway to China, which means that the two regions are ideally positioned to cooperate more closely and deepen ties in the future.
Koh predicts that multilateral or bilateral free trade agreements will further stimulate integration and interaction between different economies, with RCEP and TPP both presenting opportunities for the future. He commented that although the US has withdrawn from TPP, all the participating nations continue to believe that cooperation is of vital importance. For this reason, Singapore is both a key supporter of B&R and a founding member of the Asian Infrastructure Investment Bank (AIIB). Koh expressed his hope that B&R will provide even greater and more diverse opportunities and economic benefits for all East Asian nations.
Koh believes that economic convergence can be simultaneously promoted by other routes. Taking e-commerce and the digital economy as examples, countries can work together to strengthen overall development in terms of logistics and infrastructure.
Dody Edward: Bringing together Asian strengths to create a win-win situation
Dody Edward, Special Advisor to the Minister of Trade on International Relations of Indonesia, commented that globalization is presenting the world with new forces that require cooperation as a means to deal with challenges. He also appealed to East Asian nations to actively work together to bring together Asian strengths and achieve integrated development of the regional economy.
Indonesia has achieved impressive development over the last few years and is already the world’s 16th largest economy with the third-highest annual growth rate. Edward stated that Hong Kong is a major economic partner for Indonesia. He hopes that the two sides will have even greater opportunities to work together in future, with particular regard to the reforms and improvements to the investment environment in Indonesia that are currently being implemented, for example in terms of deregulation and increased support for local industries.
The world is moving into the age of the digital economy and Indonesia is no exception. Edward indicated that the Indonesian government is actively promoting the development of e-commerce and efforts to increase competitiveness. Government services have led the drive towards computerisation with as many as 85 import and export license procedures already transitioned to online systems, a change that he believes will help to increase the country’s level of efficiency and competitiveness.
Wang Yanzhi: The Greater Bay Area and RMB services highlight Hong Kong’s strengths
Wang Yanzhi, President & Executive Director of the Silk Road Fund Co Ltd, noted that the government has set up two organizations to support its efforts to promote the B&R initiative: the AIIB and the Silk Road Fund. Unlike the AIIB, the Silk Road Fund is fully owned by the Chinese state; the Fund serves to support the construction of the B&R initiative through medium to long-term equity investment resources. Silk Road Fund investments span the world, with projects in regions including the Middle East, Russia, Europe, South Asia and Central Asia.
Wang believes that Hong Kong can make a unique contribution to both the B&R initiative and cooperation with ASEAN, while the Greater Bay Area initiative, which incorporates Hong Kong, Macau and major cities in Guangdong Province, also presents huge opportunities. In his view, the Greater Bay Area is the most dynamic region of China. It is not only prosperous, but also boasts enormous resources particularly in terms of advanced digital technology that make it exceptionally valuable for the development of the whole region. RMB is also becoming an important currency for global investment, and Hong Kong’s leading position in the RMB market leaves it ideally placed to cater to demand from international markets.
Yang Xiuping: China and ASEAN are key partners
Yang Xiuping, Secretary-General of the ASEAN-China Centre, commented that East Asia is the world’s most dynamic region with countries in the region also enjoying close relationships. ASEAN is at the heart of regional cooperation, while mutually complementary initiatives including ASEAN+3, ASIAN+6, RCEP and the East Asia Summit (EAS) are all helping to build sound foundations.
Yang said that this year marks the 50th anniversary of the founding of ASEAN and is also a critical moment for cooperation between China and the bloc. Trade between China and ASEAN nations was worth USD400 billion in 2016, while total investment reached USD183 billion. She believes that regional convergence is vital for sustaining global development, and it is therefore essential to work with other stakeholders not only to achieve economic globalisation, but also to increase cultural interaction.
Yang indicated that China and ASEAN are already collaborating on some 3,200 projects, while the first group of AIIB projects have already been launched and will soon be delivering substantial benefits in terms of regional transport infrastructure and connections.
Patrick Nip: The Greater Bay Area will deliver mutual benefit
Patrick Nip, Secretary for Constitutional and Mainland Affairs of the HKSAR, explains: as the Greater Bay Area initiative brings together nine cities and two special administrative regions with a population of more than 66 million and an economy worth HKD1,400 billion, its development potential is therefore on course to rival the San Francisco Bay Area or the Tokyo Bay Area. He believes that by combining its strengths with other cities in the region to achieve mutual benefit, Hong Kong stands to not only further promote and consolidate its position as a global financial centre, but also develop its specialist services and innovative technology.
Concering the vision for the future construction of the Greater Bay Area, Nip anticipates that Hong Kong will become a regional centre serving as a bridge between the Mainland and the rest of the world, a development that also offers Hong Kong-based businesses the opportunity to take the leap into new markets. He believes that the strengths of the Greater Bay Area also give it the potential to drive the development of East Asia as a whole. He emphasised that Hong Kong enjoys the advantages of both the “One Country, Two Systems” and the Greater Bay Area initiative, helping the territory to connect China with countries along the B&R route and maximize trade flows in both directions.
