Bargain harder with Guangdong, academic tells HK

PUBLISHED : Thursday, 27 January, 2011, 12:00am
UPDATED : Thursday, 27 January, 2011, 12:00am

As neighbouring cities grow in power and influence, Hong Kong is being asked to play a bigger role in Pearl River Delta integration.

The city ought to be more aggressive when negotiating co-operation with Guangdong, a Hong Kong-based academic says.

The comments came as the Guangdong People's Congress ended its annual meeting yesterday after discussing a draft of the province's next five-year plan, the guide to the province's development until 2015. The parliamentary body vowed to fully implement a framework agreement with Hong Kong and Macau meant to foster common economic and cultural goals.

Professor of Chinese law Ong Yew Kim, also a visiting professor at the China University of Political Science and Law, said: 'In terms of cross-border co-operation, Hong Kong has traditionally been playing a passive role.

'It would very much like to take a stronger initiative but the response from the Guangdong side has remained lukewarm.'

Guangdong authorities say plans to work closely with Hong Kong in the service sector, especially in financial services, will remain a focal point in the next five years. Vice-governor Liu Kun said Guangdong would rely on Hong Kong to carry out a range of financial business, while the city's financial sector would in return receive robust support to develop business in the province.

Ong said both sides would need to work closely together after the central government issued guidelines ordering closer co-operation, although obstacles remained.

'The main trend now is requiring both sides to step up co-operation as laid out in guidelines handed down by Beijing,' he said.

'Even so, Guangdong is in many ways finding it hard to work with Hong Kong as they deem plans floated by the SAR immature or hard to accept.'

He said Guangdong had experienced difficulties in including Hong Kong in an integrated regional economy because the special administrative region was more developed in terms of rules and regulations, experience and economic management.

'Guangdong just can't keep pace with Hong Kong,' he said. 'Guangdong is left in a weaker position when developing economically and legally. This factor explains why Guangdong might appear negative on the surface while working with Hong Kong.'

To solve the problem, the professor said, the city should take on a more aggressive role.

'In the past, Hong Kong's officials weren't very active in raising a diverse range of ideas or projects,' he said. 'Nor did they display a very good understanding of the mainland's actual needs. So what they have raised so far might not seem to be very useful for Guangdong.'

Ong said Hong Kong could propose more concrete ideas for economic management, as well as rules and regulations.

Wang Zechu , a senior consultant to the Guangdong government, said the province should help Hong Kong maintain its position as an international financial and logistics centre.

He said Hong Kong was facing intense international competition, with Singapore also recording 'some achievements' in boosting its financial industry.

'One advantage Singapore claims it has is its position of being an independent country, but Hong Kong is a region that might be easily affected by the mainland,' Wang said. 'In such circumstances, Guangdong should work closely with Hong Kong but not compete with it.

'If Hong Kong fails to maintain its position as an international financial and logistics centre, it might lose most of its value.'

Some observers warn that Hong Kong's competitive advantage might be weakened by the rapid development of neighbouring delta cities - growth that the special administrative region would find hard to match.

China's 11th five-year plan, released in 2006, said the city would receive mainland backing to develop itself as a top finance, trading and shipping centre.

In December 2008, the National Development and Reform Commission published a Pearl River Delta reform and development planning framework, promoting an integrated development model by working closely with Hong Kong and Macau.

Guangdong and Hong Kong expanded their Closer Economic Partnership Arrangement, a free-trade pact, in April to strengthen co-operation in customs, finance, medical services, education and training, and transport. They also pledged to protect their shared regional environment.

Big plans afoot

In its 12th five-year plan, Guangdong aims to merge nine cities and the rural area in between

The resulting metropolis will cover 40,000 sq km with a population of: 42m