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HK's competitive edge

Updated: 2013-04-16 06:59

(HK Edition)

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Secretary for Finance John Tsang Chun-wah wrote in his latest blog entry on Sunday that the SAR government is working hard to develop an international trade platform with emerging markets as well as the mainland market. The import/export and re-export industry is one of Hong Kong's traditional economic pillars, while emerging market economies are growing fast and allow significant room for expansion. It is therefore commendable that the SAR government is actively looking at business opportunities for local companies.

However, the government and the general public should also be aware that Hong Kong's business environment is deteriorating, as local society has been distracted by a rising tide of indiscriminate politicization in recent years. All members of society should combine efforts with one heart and one will to avoid wasting time and resources on unnecessary political wrangles and concentrate instead on seizing business opportunities. Otherwise Hong Kong will have a very hard time competing with other cities in the region and maintaining prosperity.

Thanks to the speedy expansion of the mainland economy, Hong Kong has been able to benefit immensely from involvement in its development by fully tapping its competitive edge in low-tariff free trade, mature rule of law, free movement of capital, materials and personnel, free and open society, as well as strong support from the mainland governments at all levels. That is why Hong Kong remains one of the most prosperous economies in the Asia-Pacific region despite growing competition from neighboring cities. The trade and logistics industries account for a quarter of the city's total GDP while offering 770,000 jobs. Little wonder they constitute one of the four economic pillars and are a major foundation of the job market.

Although blessed with the aforementioned advantages, Hong Kong is nonetheless faced with serious challenges, such as weak consumer markets in many of the city's traditional trading partners and rising inflation caused by quantitative easing policies adopted by Western economies. The undesirable external situation is compounded by internal challenges, particularly political ambushes by the opposition. Tsang said many foreign countries and regions are now trying very hard to lure Hong Kong-based big companies away and some of them may succeed if the business environment deteriorates further. We must do our best to prevent it from happening.

This is an excerpted translation of a Hong Kong Commercial Daily editorial published on April 15.

(HK Edition 04/16/2013 page1)

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