Economic development plan for Zhuhai's Hengqin Island doubted
Hengqin's boosters see it as an investment magnet, but doubters say Macau's only business is gaming and similar projects have flopped
Hong Kong and Macau analysts have criticised as wishful thinking mainland authorities' plan to develop seven pillar industries on Zhuhai's sleepy Hengqin Island and boost economic co-operation with Macau.
The 106 square kilometre island with a population of just 7,000, next to Macau's Taipa and Coloane islands, is poised to become a free-trade zone with Macau and Hong Kong, after Beijing approved pilot co-operation projects in customs, finance, revenue systems and land management last year.
Sweeteners endorsed by the State Council include exempting all overseas goods shipped to Hengqin from import duties unless they are transported to the rest of Zhuhai or elsewhere on the mainland, and charging qualified companies a corporate tax rate of 15 per cent, compared to the mainland average of 25 per cent.
Niu Jing, director of the management committee for the Hengqin New Zone, said the island would focus on developing business services, the financial industry, cultural innovation, tourism, scientific research, hi-tech industries, traditional Chinese medicine and health care, with talent and investment to be attracted from Hong Kong and Macau.
Amid speculation about Hengqin's economic prospects, the underdeveloped island's housing prices have soared to more than 10,000 yuan (HK$12,200) a square metre from just 1,500 yuan three years ago. But the island's first main road was only completed last month, and businesses will have to wait another two years before the island's basic infrastructure, such as roads and gas and sewage pipelines, is ready.
Dr Kwan Fung, head of the University of Macau's economics department, said industrial co-operation between Hengqin and Macau was just wishful thinking by the mainland authorities.