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  • Oct 22, 2014
  • Updated: 7:51pm
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POLITICS

Hong Kong losing its competitive edge, Beijing warns

Top official hopes city will forge ahead, but is accused of trying to divert attention from reform

PUBLISHED : Sunday, 28 April, 2013, 12:00am
UPDATED : Sunday, 28 April, 2013, 5:50am
 

Hong Kong is losing its competitive edge and will be "swept downstream if it does not forge ahead", warns Beijing's man in charge of Hong Kong affairs.

Zhang Dejiang, No 3 on the seven-man Politburo Standing Committee, is by far the highest-ranking figure to voice such concerns.

But one observer believes Beijing is trying to divert public attention from current political controversies over patriotism and universal suffrage.

Zhang sounded the alarm at his first meeting with a political grouping from Hong Kong since taking charge of the Communist Party's leading group on Hong Kong and Macau Affairs.

"Every country in the world is trying to get out of the shadow of the global economic crisis," he told a 31-strong delegation of the Business and Professionals Alliance in Beijing yesterday. "Hong Kong's competitive edge is weakening and will fade away if the city does not put its focus on economic development."

Quoting Deng Xiaoping's warning that "development is the only hard truth", Zhang said: "Only when the economy continues to thrive will livelihoods improve. Everything else is empty talk. Like a boat sailing against the current, it will be swept downstream if it does not forge ahead."

Without elaborating, he said "deep-rooted conflicts in economic development" had begun to emerge in the city.

Zhang's comments came on the heels of a similar warning by Zhou Bo, deputy director of the Hong Kong and Macau Affairs Office, in the city last week.

Professor Chan Ka-keung, secretary for financial services and the Treasury, disagreed that Hong Kong was losing its edge. "The city's advantages are in our own hands," Chan said, citing the legal system and financial market as examples. "[The economy] depends on ourselves after all, but we have the necessary conditions to reach new heights."

Alliance chairman Andrew Leung Kwan-yuen said he saw Zhang's remarks as a reminder rather than a warning. Leung quoted him as saying the coming three years would be crucial.

Leung took aim at the current debate on electoral reform, saying: "The political feud is hindering our competitiveness."

Veteran China watcher Johnny Lau Yui-siu said Zhang wanted to shift the public focus from political reform to the economy.

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This article is now closed to comments

Dai Muff
If Hong Kong wants to push ahead economically, it has to stop relying on outrageous property prices as a sign of economic success. Rent kills hundreds of small businesses before they can even get off the ground. They make it for a year, squeezing a profit, and then a greedy landlord wipes out the whole business by demanding a rent greater than that profit.
aplucky1
and it is pure greed
the landlords costs are NOT increasing
the government should step in an stop this legalized robbery
johnyuan
Hong Kong was once a vibrant place for business creation. In fact, some of those business that got the beginning in the 70s has grown big and become conglomerate even on international scale. Nevertheless, Hong Kong’s conglomerates are limited. They are limited in creating new products or services. They are limited in expanding local employments. Rather they are individual companies that amass profits through domination of local market. Here we have even a bigger consequence. The cross financial gain allows non-core business to fall behind innovation and at the same time still dominates market. If we take a look at GE of an American conglomerate, each of their sectors within the conglomerate structure exists in its own right with flying color in the Fortune 500. Hong Kong’s conglomerates are just too destructive to the sustainability of Hong Kong as a city of 7 millions. Hong Kong’s future shouldn’t be in the hands of just a few.

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