Legislative Council Meeting Members’ Motions: Actively seizing the opportunities arising from the country’s new development pattern featuring ‘dual circulation’ to revitalize the post-pandemic economy

Actively seizing the opportunities arising from the country’s new development pattern featuring ‘dual circulation’ to revitalize the post-pandemic economy

MR CHAN CHUN-YING (in Cantonese):

President, the Fifth Plenary Session of the 19th Central Committee of the Communist Party of China has explicitly proposed “accelerating the establishment of a new development pattern featuring ‘dual circulation’ which takes the domestic market as the mainstay while enabling domestic and foreign markets to interact positively with each other”. I thank Mr Martin LIAO for proposing the motion on “Actively seizing the opportunities arising from the country’s new development pattern featuring ‘dual circulation’ to revitalize the post-pandemic economy”, which allows this Council to, through debate, urge the SAR Government to lead various sectors in Hong Kong to actively seize the major historic opportunities to achieve mutual benefits with the Mainland.

Since the reform and opening up of the Mainland, the “international circulation” pattern which “puts both ends of the production process on the world market and takes forward the strategy of ‘large-volume import and export'” has achieved huge success. However, there are also flaws in this pattern, as it is not conducive to restructuring industries into medium-to-high-end industries, and is prone to stir up conflicts with other countries. In order to realize high-quality development, China must pursue innovation to achieve high-quality growth driven by domestic demand. This means that the previous models, dynamics, methods and paths for driving economic development will have to be adjusted and changed accordingly.

Being hard hit by the COVID-19 epidemic, the international economy has declined significantly and revived slowly, with global demand slumping severely. At present, international economic circulation is facing the risk of uncertainty and instability, and the industrial and supply chains are being restructured. In recent years, we have seen the rise of unilateralism and protectionism and the fall of globalization. The United States has not only waged trade wars and technology wars against China, but has also formed cliques and used many tricks like sanctions to elevate the risk of a decoupling of China and the United States. This highlights the fact that it is insecure for both the Mainland and Hong Kong to rely on international circulation alone.

In the face of the new challenges and new opportunities arising from the profound changes in domestic and international landscape, Hong Kong, as one of the most free and open economies in the world, can play a key role and actively participate in a higher-level “dual circulation” interaction. For example, for the construction of 18 free trade zones and 1 free trade port in the Mainland, Hong Kong can provide its free port development experience of over a century, and provide concrete and feasible policy recommendations in terms of the free trade, free enterprise management, free currency circulation, free movement of people, free flow of information, legal system construction and world-class business construction, and assist them in achieving their goals as soon as possible.

Regarding financial opening, as Mr Martin LIAO has said earlier, Hong Kong as one of the three leading international financial centres in the world, can strengthen cooperation with the Mainland in areas such as innovative finance, silk road finance, people’s livelihood finance, and green finance to accelerate the development of the capital market, the wealth management market and the offshore Renminbi market. While promoting a broader financial opening in the Mainland, Hong Kong can further enhance its status as an international financial centre.

Hong Kong is the intersection point of domestic and international circulations, playing a “participant” role in domestic circulation and a “facilitator” role in international circulation. Local enterprises should properly plan their future strategies of restructuring and upgrading, and participate more in the huge economic construction in the Mainland by, among others, (1) directly participating in the new infrastructure and new urbanization initiatives, as well as major transportation and water conservancy projects or their up- and downstream projects; (2) shifting the market focus to the Mainland; and (3) supporting the development of the relevant industries in the Mainland through capital contribution.

Most importantly, Hong Kong must better integrate into the overall development of the country, further deepen its economic and trade cooperation with the Mainland, support and complement the country’s establishment of a new development pattern featuring “dual circulation”, and particularly play a more significant role in the Guangdong-Hong Kong-Macao Greater Bay Area and the Belt and Road Initiative. Only in this way can Hong Kong, under the reform of a century genuinely, break through the economic development bottleneck and get out of the predicament brought about by the COVID-19 epidemic to chalk up even greater achievements.

President, I support the motion of Mr Martin LIAO, and hope that the Government can actively consider adjusting the work practice and directions of the Hong Kong Economic and Trade Offices in the Mainland and in overseas, so as to seize the opportunities brought to Hong Kong by the new development pattern featuring “dual circulation”.

I so submit. Thank you, President.