With structural changes such as the trend toward global deglobalization and China-United States tensions, Hong Kong’s economy is having to deal with strong headwinds and restructuring challenges, business leaders and economists said at a conference hosted by the Hong Kong Development Forum on Wednesday.
They agreed that Hong Kong should cultivate a systemic approach to dealing with the new economic situation, and identify new sources of business growth, such as aircraft leasing, green logistics, and maritime services, as well as position the city as the non-US dollar financial center and global treasury center for enterprises.
He (Kwok Kwok-chuen, former CEO of the Academy of Finance) added that although the traditional trade and logistics sector is under strain, Hong Kong can find other new sources of business growth such as aircraft leasing, green logistics and maritime services comprising ship management, ship broking, ship finance, maritime insurance and law
“Hong Kong is facing many structural changes in geopolitical trends such as deglobalization, China-US tensions and the country’s reform and opening-up policy, so the city’s economy must adjust in response to these structural trend changes,” Hong Kong Development Forum Convener Ronnie Chan Chi-chung said in his opening speech.
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Chan, who is also the chairman of Hong Kong-listed Hung Lung Properties, said Hong Kong should capitalize on the country’s development to find its own development path.
Kwok Kwok-chuen, former CEO of the Academy of Finance, said that Hong Kong has to adjust its role constantly, as development on the Chinese mainland is rapidly changing.
He said that Hong Kong’s four main economic pillars have been under strain in recent years. “Hong Kong’s transhipment trade is affected as the mainland conducts direct trade with overseas countries. The rise of technology also undermines Hong Kong’s middleman role.”
He added that although the traditional trade and logistics sector is under strain, Hong Kong can find other new sources of business growth such as aircraft leasing, green logistics and maritime services comprising ship management, ship broking, ship finance, maritime insurance and law.
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Kwok also stressed the importance of making long-term investments in land creation so that the problem of high property prices in Hong Kong can be solved.
Andrew Fung Hau-chung, chief financial officer and executive director of Hong Kong-listed Henderson Land Development Company, said that Hong Kong should reposition itself as the non-US dollar financial center and the global treasury management center for enterprises.
He said that, as the mainland’s economic and trade linkages with the Middle East, the Global South and ASEAN (Association of Southeast Asian Nations) countries continue to strengthen, Hong Kong can leverage the business opportunities arising from the increasing number and size of the financial transactions occurring between all these parties, conducted in their local currencies or in renminbi, Fung argued.
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Fung also said that the central government could permit more mainland corporations to set up their treasury management centers in Hong Kong when these companies increase their direct investments in overseas countries.
Richard Wong Yue-chim, provost and deputy vice-chancellor of the University of Hong Kong, said that Hong Kong is facing an issue with its demographic changes such as its aging population and a declining workforce, and that the government should find ways to tackle this issue.
The vice-chancellor also said Hong Kong needs to develop new technologies to cater for the development of high value-added industries and the digital economy.
