China is moving into a new stage of development during which a "dual circulation" approach to growth and technology self-reliance are the focus, presenting the Hong Kong Special Administrative Region (HKSAR) with enormous opportunities to revitalize its economy, the city's financial secretary said.
In a blog post on Sunday, HKSAR Financial Secretary Paul Chan Mo-po wrote that China's 14th Five-Year Plan (2021-25) and its long-term objectives throughout 2035 set the direction for future social and economic development.
The nation is entering a stage of quality development, with the economy shifting from being export-driven to being increasingly driven by domestic demand, which necessitates an expansion of domestic demand and a consumption upgrade, Chan said in the post.
Therefore, efforts are required to up the ante in sci-tech innovation in order to lift domestic demand, improve supply chains and create a relatively independent and complete premium industrial system, thereby reducing technology reliance on other countries, he added.
China's retail sales of consumer goods totaled nearly $6 trillion in 2019, equivalent to 95 percent of US consumption, and the nation's consumer market is predicted to overtake the US this year.
China's per capita GDP only registers at around $10,000, still a long way from the levels seen in developed economies.
As long as the Chinese mainland economy continues to grow, and mainland residents continue to see rising incomes, the domestic market for consumer goods will maintain an upward spiral, Chan reckoned, noting that Hong Kong businesses can seek an active involvement in domestic market demand, through pushing for domestic sales of premium items and exploring the distribution of imports.
On top of this, the HKSAR government has strengthened partnerships with Shenzhen in the sphere of technology in recent years. Hong Kong is known for its cutting-edge basic research prowess and five of its local universities are among the world's top 100. Hong Kong also has a sound ecosystem for technology innovation, including an internationalized social environment, intellectual property protection, global science and research institutions and talent and top-rate financial services.
These strengths allow for the city to play a unique and significant role in building the Guangdong-Hong Kong-Macao Greater Bay Area into an international sci-tech innovation hub, read the post.
Furthermore, the city's globally reaching commercial and trade networks fit into the nation's vision to pursue a high-level opening-up on a greater scale and across wider-ranging areas during the 14th Five-Year Plan.
The city is also set to continue its role as the overseas fundraising center for mainland firms and remain an important conduit for overseas capital to flow into the mainland market, the financial secretary wrote.
Hong Kong's economy is seeing signs of bottoming out after posting contractions for five consecutive quarters. The economy's annual contraction narrowed to 3.4 percent in the third quarter after hovering around 9 percent in the first and second quarters. On a quarterly basis, the economy even expanded 3 percent in the third quarter.
The city's exports also returned to growth with the benefit of a substantial rise in exports on the part of the Chinese mainland.
Along with further relaxation of a portion of social distancing measures, local restaurants and shopping malls are also gradually coming back to life.