Bill Condon writes that the SAR needs a bold vision and a solid strategy to fully exploit the wide-ranging opportunities of the Belt and Road Initiative

Over recent months we have been hearing more and more about the Belt and Road Initiative. The media is also taking much more interest in it. We can expect the subject to be high on the agenda in the foreseeable future as the project gathers momentum.

The vision to create a modern-day Silk Road by developing a series of economic corridors over land and sea to integrate trade and investment, underpin economic development, provide greater connectivity and increase regional stability is now well underway.

Closer economic ties will eventually help bind otherwise disparate communities together, raising levels of awareness and understanding of the ethnically diverse communities which weave their rich cultural tapestries along the respective trade routes.

The Silk Road Economic Belt is arguably the most important of these routes. It runs from Tianjin through Central Asia and into Eastern Europe. Informed opinion suggests that eventually the route will expand to provide access to the Pacific Ocean via Rajin Port in North Korea, an all-year ice-free port, where it will eventually link up with the Trans-Siberian Railway. Combined with access to the Atlantic Ocean via Eastern Europe, along with the ever more likely opening-up of the Northern Sea Route due to global warming, the result will certainly disrupt current supply chain dynamics. It will reduce transport time by as much as two thirds, encouraging further economic development and urbanization.

There is no doubt that Belt and Road will have a powerful global impact, but it will take a major effort from all stakeholders to keep it on track and maintain momentum. When one considers the progress China has made in terms of its economic development and prosperity, delivered in a relatively short period of time, there should be little doubt that President Xi Jinping's vision will be delivered and it is rapidly becoming a reality.

The main problem is driving forward 65 sovereign constituents, spanning three continents, in harmony. Cohesion is vital to support the massive infrastructural development required within the individual corridors, which in turn will drive urban development and bring real benefits to local communities at grassroots level.

Despite participants having different national agendas, aspirations and requirements, the concept of bringing economic prosperity and empowerment to many millions of people is a powerful stimulant and one that is capable of advocating a harmonious approach. As long as strategic plans unfold, integration strategies become clearer, an increasing number of projects are completed and new ones spring to life, we will see confidence continue to grow.

Xi is the visionary and China the driving force. The beneficiaries will be the countries that have committed to the project as well as the many others that will benefit through the provision of goods or services required to fulfill the vision.

So how will Hong Kong benefit from the initiative?

Significant opportunities will undoubtedly arise as the project unfolds. What is very clear is that Hong Kong needs a brave vision and a solid strategy to fully benefit from and exploit the wide-ranging opportunities that will be presented.

At present our most obvious strength lies in the financial services sector. It is generally ranked as the third most important international financial center after London and then New York, and importantly is the global hub for renminbi trade and banking services outside of the mainland. All of this is underpinned by a robust and transparent legal system and in recent years we have become one of the leading locations in the region for dispute resolution. So we have a distinct advantage in financial and professional services and there should be little doubt these sectors are well placed to benefit.

However, it is particularly important that small and medium enterprises (SMEs) are encouraged to participate so that tangible benefits percolate through into the local economy. Many SMEs have the ability and agility to respond rapidly. They tend to be better equipped to adapt rapidly to complex market environments and they are the lifeblood of the economy. In order to be able to identify and take full advantage of the opportunities, they may need government support. Perhaps a range of public-private partnerships should also be explored to establish strategies that best serve the local economy as a whole. This is definitely an area where closer liaison with the central government may offer distinct advantages.

Let us not forget that Hong Kong is at a critical juncture and needs to take credible steps toward providing a reasonable standard of living for all citizens in an increasingly difficult, interconnected, global economy. The Belt and Road Initiative provides enormous and tangible opportunities, but at the moment there is little sign the SAR government and business leaders can match the vision or appetite of the central government to think outside of the box or to think big.

(HK Edition 03/14/2016 page9)