Editorial | Regional free-trade agreement shows Hong Kong means business

Hong Kong emerged as a city of two tales last week. One counted the cost of fighting Covid-19 – a further 4.5 per cent contraction in the economy in the third quarter. The other looked forward, painting a vibrant future as the authorities relax or drop growth-crushing pandemic measures and the city opens up.

Thankfully, by the end of the week, optimism prevailed. Chief Executive John Lee Ka-chiu revealed Hong Kong was set to complete negotiations for early admission to the Regional Comprehensive Economic Partnership (RCEP) between China and 14 other Asia-Pacific economies, the world’s largest free-trade deal. In this it has the support of all 10 members of the Association of Southeast Asian Nations (Asean).

He also told the inaugural Hong Kong-Asean summit, organised by the South China Morning Post, the city would help Southeast Asian countries secure opportunities offered by the Greater Bay Area, an economic powerhouse of 11 cities in the south of China including Hong Kong and Macau.

These initiatives will expand the city’s pivotal role as a global financial hub and bridge to China, both as a partner to Asean as it seeks opportunities in the GBA, and in adding value to the regional trade pact. The political reality is that Hong Kong’s trade relations with Asean, with which it already has a free-trade and investment agreement, can only get stronger as tension between China and the West drives them together.

A former deputy minister of the Communist Party’s International Liaison Department, ambassador Yu Hongjun, told the summit membership of the RCEP was likely to further bind the city’s fortunes to the Asian region. Singaporean Health Minister Ong Ye Kung offered a similar positive view of Hong Kong’s economic integration with Asean, adding that the city state strongly supported the city’s RCEP application.