The interdependence between Guangzhou and Hong Kong can be traced back to the days when the former was a bustling commercial city and the latter a newly established trading concession. Hong Kong has long since become an international trading hub in its own right but the relationship now is no less important or symbiotic.
The arrival in Hong Kong of Guangzhou Mayor Zhang Guangning and more than 200 businessmen should provide a fresh opportunity to discuss how to take the partnership in a mutually beneficial direction.
Hong Kong's role in Guangdong province for the past several decades has been well defined. As providers of billions in private investment capital, Hong Kong industrialists and bankers have triggered the region's transformation from rural backwater to workshop to the world. Along the way, they have reinforced Hong Kong's role as a transport hub and provider of the financial, logistics and marketing services which are crucial to the health of Guangdong's export-oriented industries.
But that role will have to evolve as cities such as Guangzhou develop their own capabilities for dealing directly with the outside world. How Hong Kong responds will in large part determine the city's future prosperity.
Many of our advantages, of course, remain and they should be trumpeted far and wide - and made known to the Guangzhou delegation. That some of the officials and businesspeople are hoping to lobby for tax and other incentives while here indicates that we have been failing on this front. With one of the lowest corporate tax rates in the world, few investment restrictions and virtually no import tariffs, Hong Kong has low barriers to investment from anywhere in the world, Guangdong included.
When these factors are combined with iron-clad legal protection for contracts and property, sophisticated capital markets and a workforce familiar with doing business with the outside world, the incentives should speak for themselves. But assuming that they do is not enough.