Decoding the Outline Development Plan for Guangdong-Hong Kong-Macao Greater Bay Area (GBA)
Having kicked-off with the white paper entitled "From 'world factory' to 'world-class bay area'- Proposals for the development of the Guangdong-Hong Kong-Macao Greater Bay Area", Deloitte releases its second issue on "Decoding the Outline Development Plan for Guangdong-Hong Kong-Macao Greater Bay Area (GBA)". In this report, Deloitte delves into the four pillars—deepening regional economic integration, developing an international innovation & technology hub, building a modern industrial system, developing a quality working and living sphere—providing in-depth analysis on the two objectives, five strategic positioning and eight priorities laid out in the GBA Development Plan.
GBA is undergoing a major industrial upgrade from manufacturing-led economy to service-oriented and innovation-driven economy. Compared with other major world-class bay areas, the proportion and the economic contribution of service industries in the GBA is relatively low at present. Deloitte sees huge potential of improving GBA's service and innovation industries, as the region further develops a modern industrial system and moves towards an international innovation & technology hub.
Major GBA cities are turning from intraregional competition to collaboration based on their respective industry focus and resource endowment, avoiding competition in the same sector and achieving synergy by combining complementary strengths.
GBA's strength lies in innovation at application level, with more room to build up capacity in fundamental research. GBA ranked 2nd globally in regional cluster innovation capability, home to a slew of well-known universities, state-level laboratories, high-tech companies and business incubators. Admittedly, the bulk of the investment made in technology and innovation are still application-oriented. Looking forward, GBA should invest more in fundamental research and core technologies that feature high upfront costs, long-term investment and high risks involved.
Financial services will organize around improving connectivity and promoting innovation. GBA Development Plan stressed on financial connectivity: Hong Kong and Shenzhen Stock Exchange will collaborate in mechanism and financial products to provide new strategic opportunities for each other. In this regard, Deloitte expects innovation arising in infrastructure financing, asset management, cross-border finance, FinTech and insurance.
Talent connectivity between the mainland and Hong Kong & Macao needs to be activated. GBA is seeing a net inflow of talents, with Shenzhen as the lead city in talent attraction and retention. The size of Hong Kong's talent pool ranks top three in GBA, but talent exchanges with other GBA cities remain relatively low. Talent exchanges between the two special administrative regions and Mainland cities need to be further improved.
Looking ahead, Deloitte sees an expedited flow of people, goods and capital. Enhanced regional coordination and industrial synergy will expand its impact and drive the development of neighbouring regions. Strengthened IP protection and trial-and-error mechanisms will improve the overall innovation environment. Furthermore, "competitive neutrality" will create greater space for the development of private enterprises.