Latest 5-year plan should include integration of Guangdong-Hong Kong-Macao service sectors: Committee member

A Hong Kong member of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) says that China's latest five-year plan should include plans to establish a Guangdong-Hong Kong-Macao Special Region of modern service industry.

At the CPPCC's plenary session yesterday, Kennedy Wong Ying-ho said the new proposed region, which would be different from existing economic regions, should be a special one under the 'One Country, Two Systems' principle. The three areas guided by the new region would have interlinked financial networks, reciprocal recognition of professional qualifications among them, similar regulations, effective and professional quality services, Wong suggested.

The Outline of the Pearl River Delta Regional Plan on Reformation and Development issued in 2008 proposed giving priority to a modern service industry to increase the region's total service sector GDP to 53 percent by 2012 and 60 percent by 2020.

"To achieve this goal, we must intensify our efforts, take special measures, break the convention and be advanced," Wong said.

Wong believes that leaders must make efforts in four directions: Dismantle obstacles erected by separate financial systems; recognize professional qualifications; create regulations to provide authoritative mediation and arbitration; and divide labor rationally among the three areas.

Wong is convinced that if the government establishes the special region, it could build a strong impetus for Guangdong province to optimize its industrial structure and enhance the Pearl River Delta region's international competitiveness.

Hong Kong's business community seemed to welcome the proposal.

"Hong Kong's experience in the service industry will support the development of the mainland's service sector," said Alex Fong, CEO for the Hong Kong General Chamber of Commerce.

Hong Kong's service sector is well developed and highly competitive. It covers more than 90 percent of Hong Kong's total GDP. By contrast, the mainland's service sector accounts for only 42 percent of its total GDP, Fong noted.

Despite the positive reception to Wong's idea of a special service industry tri-zone, some scholars are concerned with its practical implementation.

"The problems are that the legal systems in the three places differ greatly and that the requirements for qualified lawyers also vary. The threshold among the three jurisdictions cannot be crossed overnight," said professor Zhang Xianchu of the Department of Law at the University of Hong Kong.

"In Hong Kong, the financial market is quite mature now. The government cannot require banks or other private sectors to make changes," said Charles Li Kui-wai, associate professor of the Department of Economics and Finance at the City University of Hong Kong.

(HK Edition 03/11/2010 page2)