Deep Dive: Hong Kong slow to integrate into the Greater Bay Area

Hongkonger Henry Lim Chuen-choy catches a high-speed train from West Kowloon every morning, taking about 45 minutes to reach his office in Shenzhen, in mainland China’s Guangdong province.

The cross-border commute has become a daily routine for the 35-year-old doctor since he took a job last year at GBA Healthcare Group, a Shenzhen-based Hong Kong healthcare start-up that runs clinics at mainland hospitals in the Greater Bay Area (GBA) and provides training for mainland medical staff.

Lim studied medicine in London and practised in Britain and Singapore before returning to Hong Kong. He had a senior management position at a private hospital in the city before he left for the bay area.

“The primary care sector of the region has not yet taken full shape, which means huge room for development and unlimited possibilities for me,” he said.

Hong Kong’s Labour Department recently held the “Greater Bay Area (GBA) Youth Employment Scheme and Pursuing New Opportunities Job Fair”. Around 4,000 vacancies from various industries were open for job seekers. Photo: Dickson Lee

At first, he was caught off guard by the different environment, culture, way of life, and work. He was unfamiliar with electronic payments and was not on WeChat, the social-messaging platform widely used there.

He now leads a team of nine, manages operations for the group’s clinics, conducts training and takes mainland medical staff on exchanges to Hong Kong.

“I see myself playing a bridging role between Hong Kong and the mainland,” he said.

February 18 marks five years since Beijing unveiled its blueprint to turn the bay area – comprising Hong Kong, Macau and nine cities in Guangdong – into a hi-tech economic powerhouse to rival California’s Silicon Valley by 2035. Hongkongers like Lim and businesses in the city are slowly recognising the region’s massive opportunities.

Measures such as allowing northbound travel for Hong Kong vehicles and infrastructure projects like the new cross-border checkpoint have made it easier than ever for people and goods to move across the border.

According to China’s census published in 2021, more than 371,000 Hongkongers were living on the mainland, accounting for about 5 per cent of the city’s population that year. But experts and politicians said more needed to be done as Hong Kong had yet to take full advantage of opportunities in the bay area vision. They said the city also had to speed up developing new industries or risk losing its edge over the mainland cities.

Staff writer

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Question prompts:

1. Which statement below best describes how Lim sees himself fitting into the bigger picture of Hong Kong’s integration into the Greater Bay Area? A. He is leading a team of medical professionals in Shenzhen. B. He is managing operations for a healthcare start-up in Hong Kong. C. He is bridging the gap between Hong Kong and the mainland. D. He is explaining Hong Kong healthcare concepts to locals in Shenzhen.

2. Explain ONE benefit and ONE challenge that Lim faced in taking the job at GBA Healthcare Group last year.

3. Using News and your own knowledge, list THREE key factors that have helped Hong Kong’s businesses and residents with “recognising the region’s massive opportunities”.

Illustration 1

Question prompts

1. Use details from the illustration to explain why the people depicted in it are heading to the Greater Bay Area from Hong Kong.

2. Based on News and your own knowledge, how have infrastructure projects made it more attractive for Hongkongers to work in the Greater Bay Area?

Issue: Hong Kong “has its edge” but has been slow to integrate into Greater Bay Area

• Hong Kong must “enhance its competitiveness” to attract talent, experts say

• Survey finds more young Hongkongers are willing to work in the mainland than previous years

Hong Kong is expected to play several roles in Beijing’s blueprint for the Greater Bay Area (GBA). One of these is building closer ties with the GBA’s mainland cities and connecting them with the global community.

However, experts say Hong Kong got off to a slow start due to anti-government protests and the Covid-19 pandemic.

Guo Wanda, executive vice-president of the China Development Institute, a Shenzhen-based think tank, said the disruptions had hit Hong Kong’s economy, and the border closures affected its ability to connect to the mainland and be a bridge to the outside world.

All that, together with rising tensions in the US-China trade war, weakened the city’s status as an international financial hub, he added.

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Still, evidence suggests that younger Hongkongers are more open to seizing opportunities across the border. Hong Kong-Guangdong Youth Association’s latest annual survey showed that adult Hongkongers under 40 were becoming more willing to work in mainland cities in the bay area. The percentage rose from 22 per cent in 2019 to 66 per cent last year.

In that time, more than 80 major incubation centres opened across the bay area to attract Hong Kong and Macau entrepreneurs to develop start-ups there.

Hongkonger Ron Lam Kwong is behind one of those incubation centres. Years ago, he learned some hard lessons about doing business on the mainland. Despite cheap rent and manpower costs, there were difficulties setting up a business on the mainland, such as learning its labour laws and regulations.

His experience prompted him to set up Global Catering Incubation Centre in 2021 in Zhuhai’s Hengqin island. It helps newcomers to the mainland market by offering consultation and company registration services.

“Hong Kong businesses have huge potential to expand into the mainland market, and mainland firms also long to come to Hong Kong,” he said. “The integration between the two places has been speeding up.”

An aerial drone photo taken on November 4, 2023 shows a view of the Hengqin International Financial Center in Zhuhai, in China’s Guangdong Province. Photo: Xinhua

He found that many Hong Kong companies faced difficulty ensuring consistent product quality after moving to the mainland as they had to work with different raw materials. They also grappled with understanding and catering to mainlanders’ tastes and demands.

But now, Lam noted there were more preferential policies, such as rent and housing subsidies, that made it easier for businesses to set up.

Professor Christopher Chao Yu-hang, vice-president of research and innovation at Hong Kong’s Polytechnic University, said more local start-ups were willing to tap into the vast mainland market.

He also observed that there was more investment capital from across the border in recent years but large remittances were an issue as it took time to gain the necessary approval to proceed.

“The capital flow is not 100 per cent smooth,” he said.

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In regards to what Hong Kong has to offer, Chao said that it should strengthen its ability to connect mainland cities and technological products with the world.

“Hong Kong has its edge in design, fundamental research, management system and foreign capital flow,” he said. “It can attract the overseas market and gradually integrate with the mainland.”

The government should also speed up the construction of infrastructure and make clear its plans for the innovation and technology cooperation zone with Shenzhen coming up at the Lok Ma Chau Loop.

Some facilities in Shenzhen have begun operating, but Hong Kong is still developing its first three buildings.

Guo said: “The city itself has to think of how to consolidate and enhance its competitiveness.”

Staff writer

Question prompts

1. Why do experts believe Hong Kong has been slow to achieve some of its goals under Beijing’s blueprint for the Greater Bay Area?

2. Identify TWO factors that have attracted more Hongkongers to set up businesses in other parts of the Greater Bay Area.

3. What are some key issues Hongkongers face when starting businesses in the mainland? (1) They cannot afford the expenses of hiring employees and paying rent. (2) They struggle with making sure that they can still produce high-quality goods. (3) They are unfamiliar with what people across the border are interested in buying. (4) It is not easy to move money over the border.

A. (1), (2), (3) only B. (1), (2), (4) only C. (2), (3), (4) only D. all of the above

Illustration 2

Question prompts

1. What does the illustration depict about the future of the Greater Bay Area?

2. Based on Issue and your own knowledge, what obstacles to GBA integration are represented in this illustration by the block in the path? Suggest ONE policy to address this.

Glossary

• Greater Bay Area (GBA): an area comprising Hong Kong, Macau and nine cities in Guangdong in mainland China. It is about 56,000 sq km, with a total population of more than 86 million people. That makes it larger and more populous than the world’s three leading bay areas in New York, Tokyo and San Francisco. Hong Kong is expected to play several roles in Beijing’s blueprint for the GBA, such as consolidating its international status in finance, aviation and trade, as well as strengthening professional services.

• incubation centres: specialised organisations or facilities that support the development of entrepreneurial ventures. These centres often provide resources, mentorship, and networking opportunities.

• infrastructure: the basic physical systems of a region or nation, often involving the production of public goods or production processes. Examples include transport systems, communication networks, sewage, water, and school systems.

• innovation and technology cooperation zone: located on both sides of the Shenzhen River – the border between Hong Kong and the mainland – the zone will have an international innovation centre in a 300-hectare (741-acre) area on the Shenzhen side and another 87-hectare area at Lok Ma Chau Loop on the Hong Kong side.

Can the Greater Bay Area lure foreign investors? Beijing wants Hong Kong to draw international capital into the region, but global firms are still hazy about the benefits. Photo: SCMP graphics

Answers

News1. C2. One challenge Lim faced was adjusting to the differences in the way of life in Shenzhen, but one benefit was having huge room for career growth since the region’s primary care sector was still developing.3. Factors such as improved cross-border travel, untapped potential in sectors like technology and healthcare, and China’s focus on developing the Greater Bay Area have helped Hongkongers realise the region’s economic possibilities.

Illustration 11. The sign that says “Hiring now!” suggests that the people in the illustration are heading to the Greater Bay Area to seek employment opportunities.2. With the new cross-border checkpoint as well as the cross-border train, it is easier for Hongkongers to keep up their lives in Hong Kong even while working in Shenzhen or other cities in the GBA.

Issue1. Hong Kong’s progress was slowed because the anti-government protests, the Covid-19 pandemic, and the US-China trade war hit the city’s economy and weakened its status as an international finance hub.2. There are more incubation centres and preferential government policies to support Hong Kong’s entrepreneurs in setting up shop in other parts of the bay area.3. C

Illustration 21. The illustration indicates that there are hurdles ahead for the Greater Bay Area.2. Obstacles to GBA integration include Hong Kong’s slow construction of the innovation and technology cooperation zone, as well as the slow flow of capital across the border. The government should work on a special agreement for certain approved companies to waive the long approval times for remittances. (accept other reasonable answers)