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Hong Kong to play new role in Pearl River Delta

(Xinhua) Updated: 2014-05-30 18:07

GUANGZHOU -?Hong Kong's new role in the Pearl River Delta (PRD) region helps prop up its competitiveness amid concerns that the city might be losing its strength, according to a new report.

Released on Thursday in south China's Guangdong Province, the report was conducted by the Public Policy Research Institute (PPPI) of the Hong Kong Polytechnic University and commissioned by InvestHK of the Hong Kong SAR government.

"This is a new era, and Hong Kong is embracing a new role. By strengthening cooperation with the PRD, Hong Kong will find its place in the knowledge economy era," said Chan Man-hung, director of the PPPI and lead author of the report.

The PRD includes nine cities in Guangdong, including Guangzhou, Shenzhen and Dongguan. Its GDP, combined with that of Hong Kong and Macao, was equivalent to that of the 16th largest economy in the world in 2012, ahead of Indonesia, Turkey and the Netherlands, and only slightly behind Korea.

"The area has grown in size and importance over the years," said Simon Galpin, Director-General of Investment Promotion with InvestHK. "Hong Kong can enhance its leading role in this fast-growing region as a conduit for direct investment to and from the rest of the world."

The report said the economic links between Hong Kong and the PRD region have become closer than ever before. The rapid development of the Pearl River Delta area offers new opportunities for Hong Kong.

Hong Kong's tourism industry will benefit from the growing economy of the region. The report estimated that expenditures by Mainland visitors accounted for 30.7 percent of Hong Kong's total retail sales in 2012, up 16.7 percentage points from 2005.

"This signals that the area, with increasing mobility of residences from both sides and better transportation conditions, will become an integrated market," said Chan.

The improved mobility of Mainland visitors to Hong Kong, coupled with their shopping patterns while visiting, is turning Hong Kong into a marketing arena for prestigious consumer brands, the report said.

A two-way investment platform is gaining momentum in Hong Kong. Rather than the earlier unilateral investment of international investors into Mainland, there is now a growing number of outbound investments from China, the report said.

With these preferences, Hong Kong will play new roles as a meeting point to start dialogues, develop collaboration, finish business deals, and serve as an innovation incubator, the report concluded.

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