Date
11 December 2017
General Views Of Hong Kong Skyline Ahead Of GDP Numbers

The Big Picture: HK, MACAU PROSPECTS

China will continue to devote a separate chapter for Hong Kong and Macau affairs under the nation’s next five-year economic plan, a senior mainland official said on Wednesday, pointing to the importance the central government attaches to the two special administrative regions.

Xu Shaoshi {徐紹史}, chairman of the National Development and Reform Commission (NDRC), said in Beijing that the economic planning agency has already started work on the 13th Five-Year Plan that will cover the 2016-2020 period. The blueprint, which will be announced in late 2015, will aim to strengthen Hong Kong’s status as an international financial, trade and logistics hub, he said.

As for Macau, it will be offered assistance in diversifying its economy, with the territory getting the chance to explore opportunities in Hengqin, a special economic district in neighboring Zhuhai in the mainland.

The central government hopes the Hong Kong-Zhuhai-Macau Bridge will commence operation in 2016 and that a high-speed rail line between Guangzhou and Shenzhen can connect to Hong Kong as early as possible, Xu said.

China will use three platforms, namely Shenzhen’s Qianhai, Guangzhou’s Nansha and Zhuhai’s Hengqin, to strengthen cooperation with Hong Kong and Macau, boosting growth in the Pearl River Delta region.

The mainland will encourage domestic companies to issue bonds in Hong Kong, helping the city strengthen its bond markets, Xu said. The launch of the Shanghai free-trade zone in September last year has created many new opportunities for Hong Kong. The central government will start more free-trade zone trial programs in more cities and continue to support Hong Kong, the official said. 

While Beijing has signaled continuing support for the two special administrative regions, investors in Hong Kong and Macau could be disappointed as Xu’s speech did not mention any new projects, observers say.

Although the development of Hengqin, Qianhai and Nansha was kicked off in the past few years, foreign investors have not been very enthused due to lack of enough supportive measures, they say. Even if they are interested in some projects there, most of them are deterred by the high land costs. 

Critics also note that Xu did not make any specific mention of boosting the competitiveness of Hong Kong, which is facing a threat from Shanghai and its free-trade zone. That makes Beijing’s expression of support to Hong Kong seem more like a slogan, they say.

Registration-based IPO plan seen this year

China is expected to release this year a plan for a registration-based initial public offering (IPO) process, China Securities Journal reported Thursday, citing Xiao Gang , chairman of the China Securities Regulatory Commission (CSRC). However, the new policy, which seeks to simplify cumbersome approval procedures, may not be implemented this year, pending changes to related legislation. In addition, the CSRC is considering same-day settlement of stock transactions, starting with blue chips, Xiao was quoted as saying.

Seven sectors identified for SOE structural reform

China has identified seven industries where private capital will be allowed as part of state-owned enterprises (SOEs) reform this year, the Shanghai Securities News reported Thursday. Companies involved in financial, petroleum, electricity, railway, telecom, natural resources and public utilities businesses will be encouraged to have a diversified ownership structure under the reform, it said.

–Contact HKEJ at [email protected]

JP/RC

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