Hong Kong billionaire Victor Fung is proposing a southern China common market comprising Hong Kong, Macau and Guangdong.
Fung, chairman of global sourcing group Li & Fung Ltd., wants China to include it in its 13th Five-Year Plan (2016-2020), the Hong Kong Economic Times reported Tuesday.
The special zone could be established under the World Trade Organization (WTO) framework, the report said, citing a meeting between Fung and Zhang Dejiang, chairman of the National People’s Congress.
Fung is a deputy to China’s highest political advisory body which just ended its twin sessions with the Chinese legislature.
He said the Closer Economic Partnership Arrangement, which China signed more than 10 years ago with Hong Kong and Macau, does not go far enough to promote trade, with companies having to grapple with cumbersome regulations.
A common market will solve the problem and allow unrestricted flow of goods, services, capital and information, he said.
Meanwhile, Guangdong is about to launch a free trade zone which was earlier planned to include Hong Kong and Macau.
Their inclusion was scrapped, partly because Hong Kong and Macau are separate customs territories under WTO rules.
In addition, Hong Kong’s open trading system made a negative list — a set of restrictions on foreign investment – adopted by the Shanghai free trade zone inapplicable.
Hong Kong’s relatively small size makes it necessary to integrate its trading market with those of Guangdong and Macau, Fung said.
Fung’s proposal is a rough idea and needs further study by the central authorities, the report said, citing unnamed sources in Beijing.
He urged Hong Kong to take advantage of the new economy by combining its strengths with traditional trading practices.
On a visit to Guangdong last week, Chief Secretary Carrie Lam said Hong Kong will explore opportunities for companies to participate in a free trade zone.
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