China’s State Council unveiled an overall plan for Nansha on June 14, which is expected to expand opening-up in the Guangdong-Hong Kong-Macau Greater Bay Area (GBA), and offer opportunities for Guangzhou to play a key functional role in the GBA and inject strong impetus into the country’s economy.
“The Nansha Plan is especially attractive to investors in terms of financial opening-up, talent gathering and shipping industry,” said Rebecca Wong, Tax Partner of PwC China in an interview with GDToday.
Wong said, “It supports qualified Hong Kong private equity funds to finance HK-funded technology companies in Nansha, so as to promote technological innovation.”
The plan pushes forward vocational qualification recognition and grants education chances to Hong Kong and Macau residents’ children in the area. In addition, it exempts Hong Kong and Macau residents working in Nansha from the portion of their personal income tax exceeding the tax in Hong Kong and Macau. Wong believes these moves will attract more international high-end talent.
The GBA Shipping Joint Trading Center, according to Wong, will be built by Guangdong, Hong Kong and Macau in Nansha, with an aim to deepening cooperation in shipping logistics, shipping finance, maritime services and cruise.
Hengqin and Qianhai cooperation zones to deepen cooperation with Hong Kong, Macau
In addition to the Nansha Plan, China issued plans in September 2021 for further developing the Guangdong-Macau In-Depath Cooperation in Hengqin and the Shenzhen-Hong Kong Modern Service Industry Cooperation Zone in Qianhai. That is to support the integration of Hong Kong and Macau into the development of the country, and to advance the GBA’s development.
According to Wong, the implementation of the development plans of Hengqin and Qianhai cooperation zones will establish in-depth cooperation and connectivity mechanisms with Hong Kong and Macau in industries, talent, rule of law and project construction.
Qianhai allows qualified Hong Kong professionals in 12 fields such as taxation, planning, and legal services to practice there without examinations. And professionals including architects, lawyers and tour guides from Hong Kong and Macau are allowed to work in Hengqin.
The Qianhai cooperation zone also sees improving financial connectivity with Hong Kong. Apart from the launch of Shenzhen-Hong Kong Stock Connect, Cross-Boundary Wealth Management Connect in recent years, the lately-began exchange-traded funds (ETFs) will open a new connected wealth management market in the GBA and to boost the region’s financial development.
Qianhai has also made a lot of new attempts in international arbitration. It has set up the GBA International Arbitration Center, employing arbitrators from Hong Kong and Macau to mediate commercial disputes. Next it will establish the Qianhai Commercial Court, and pilot to engage eligible Hong Kong residents to serve as jurors.
Wong believes that the implementation of innovative systems such as mutual recognition of talent qualifications, cross-boundary financial innovation, and international arbitration will increase the security of funds and reinforce the confidence of international investors.
It is significant for Guangdong to strengthen regional coordinated innovation
The Hengqin and Qianhai cooperation zones have provided important opportunities for Guangdong, Hong Kong and Macau. Together with the modern finance, professional services of Hong Kong and Macau, Guangdong’s manufacturing industry has become an important base for the region’s scientific and technological innovation development.
Wong thought the strengths of Hong Kong and Macau in professional service industries like finance, accounting, law and education, can provide intellectual support for the transformation and upgrading of Guangdong’s manufacturing industry.
“As a result, it is of great significance for Guangdong to continue to strengthen regional coordinated innovation,” said Wong.
Wong suggested the province to rely on major innovation platforms such as the Hetao Shenzhen-Hong Kong Technology and Innovation Cooperation Zone, explore and improve the technological innovation management mechanism that connects Hong Kong, Macau and in line with the world.
She added, next, to promote the connectivity of financial markets and cross-boundary financial supervision in Guangdong, Hong Kong and Macau. Take another important move in the guarantee of industrial capitalization in Guangdong by promoting the two-way opening of financial market in the GBA.
Finally, Wong mentioned the integration of professional services industry, “Guangdong can further explore overseas market with international business networks contributed by Hong Kong and Macau’s professional service industries. Also, with the advantage of their knowledge of global market and perfect supporting services, it can help Guangdong enterprises to solve the risks in going global.”