HONG KONG, a special administrative region of China, has eyed Thai and other Asean firms to invest in the new Guangdong-Hong Kong-Macao Greater Bay Area which has a combined population of 69 million and GDP of US$1 trillion.
The former colonial-era islands of Hong Kong and Macau as well as nine other southern Chinese cities, including Guangzhou and Shenzhen, are now inter-connected for the first time by one of the world’s longest highways whose construction is just completed.
This and other infrastructures as well as specific promotional policies are expected to turn the area into a new economic and investment magnet.
According to Stephen Phillips, director-general of Invest Hong Kong, Thai firms in real estate, retail, textile manufacturing, restaurant sectors and other service providers, as well as tech start-ups are among the targeted investors for the greater bay area.
With the 55-km highway linking Hong Kong and Macau with mainland southern China, the area is also seen as a major connection point for China’s Belt and Road initiative.
He said Hong Kong, which has long been a destination for large Thai firms to set up holding companies due to favourable tax and other incentives, is also a regional hub for innovation and new technologies, especially robotics, fintech and biotech as well as Internet of Things (IoT) solutions.
Regarding Thai firms, he said, several niche brands have been successful in the Hong Kong market, including those for cosmetics, |hotels and spa, restaurants, and healthcare.
As an investment promotion unit of the Hong Kong government, Invest Hong Kong also aims to promote international school operators to expand into Hong Kong and nearby markets.
In addition, fintech start-ups should also consider raising funds in Hong Kong due to favourable tax rates and financial incentives for research and development granted by the government.
Thai firms can also explore opportunities to partner with Chinese firms for projects under the Belt and Road Initiative.
Besides major US, Japanese, UK and French investors, Hong Kong has also attracted more foreign direct investment from Asean countries in the past several years.
The former British colony is also a popular destination for multi-national firms’ regional headquarters, many of which also have factories in nearby Shenzhen and other southern Chinese cities.
In 2017, Hong Kong attracted a total of 402 foreign investment projects which created a total of 6,000 jobs. Due to its favourable tax regime, Hong Kong is also a popular location for corporate treasury, foreign exchange, cash and other management activities.
Meanwhile, some analysts have suggested that President Xi Jinping aims to develop the greater bay area into a high-tech metropolis which can compete with Silicon Valley in the US while combining the strengths of Hong Kong’s capital markets and Macao’s casinos with southern China’s manufacturing sector.