Shenzhen backed as HK shaken

Top News | Bloomberg and Avery Chen 19 Aug 2019

China has unveiled plans to turn Shenzhen, which borders Hong Kong, into a world-leading city and a hub for science and technology innovation by the middle of this century.

Shenzhen will be granted favorable policies including privileges in yuan internationalization, China Central Television reported, citing guidelines issued by the Chinese Communist Party central committee and the State Council.

The new framework comes as Hong Kong remains embroiled in the 11th week of demonstrations that show no signs of abating

A"pilot demonstration area of socialism with Chinese characteristics" will be built and the city will play "a key role" in science and technology innovation in the Guangdong-Hong Kong-Macau Greater Bay Area. China will also promote the connection of the financial markets of Shenzhen, Hong Kong and Macau, including with regards to fund recognition. It will also create conditions to push forward reform of the registration system in the ChiNext board in Shenzhen.

Digital currency research and mobile payments will be supported in the city as well.

In addition, Shenzhen will be encouraged to build manufacturing innovation centers for sectors including advanced communication devices and medical instruments.

Innovation sectors include 5G, artificial intelligence, cyberspace technology and bio-medical technology, and these will get support in the city as part efforts to master key technologies.

The guidelines also said the central government will support Shenzhen raising the level of opening up to Hong Kong and Macau, and speeding up the construction of the Shenzhen-Hong Kong technology innovation cooperation area. Shenzhen was told to work toward giving "citizen treatment" to Hong Kong and Macau residents who work there, and was also encouraged to allow talented foreigners with permanent residency in China to start businesses in the city.

Shenzhen's gross domestic product surpassed Hong Kong for the first time last year, increasing 7.6 percent to 2.42 trillion yuan (HK$2.69 trillion).

Hong Kong's GDP meanwhile fell by 0.3 percent in the second quarter from the previous three months, while a key purchasing-managers index dropped to the lowest since March 2009 in July.

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