Hong Kong, as Pearl of the Orient, has undergone a significant transition from a
manufacturing base to a services-based economy. Gone are the days when manufacturing
industry was playing an important role in Hong Kong’s economy. Nowadays, Hong Kong
becomes more service-oriented. As a regional financial centre, Hong Kong has been
attracting lots of investors and entrepreneurs across the globe. They would like to explore
the business opportunities here. The factors leading to Hong Kong as a regional financial
centre are manifest. In terms of macroeconomics stability, High intensity in international
trading and investing, and wise macroeconomics policies give rise to a high economic
growth rate in Hong Kong. In terms of microeconomics environment, free and open
economic policies, low operating cost, well-developed infrastructure and financial
institution truly make Hong Kong to be an ideal business environment. However, there
may be some challenges Hong Kong should not overlook. To some extent, these
challenges would constraint its competitiveness. By comparing Hong Kong with other
countries including Shanghai and Singapore in some cases, let us take a deep look at these
challenges one by one.
First of all, in terms of ‘Transportation’, we could compare Shanghai with Hong Kong.
Shanghai has both the ‘Pudong International Airport and ‘Hongqiao International Airport’,
providing aviation and freight transport service. Shanghai also owns the largest and
well-equipped cargo port in the world. It efficiently establishes linkage with other ports
around the world. Operated by Shanghai Maglev Transportation Development Co., Ltd.,
Shanghai has the very fast and convenient ‘Maglev Train’ to provide convenient transports.
Compared with Shanghai, Hong Kong has only one International Airport, which is Chek
Lap Kok International Airport. On average, the flight movements rise by 6.5 percent every
year. Obviously, the two existing runways are likely to be saturated by 2017. Also, the
Container Terminals in Hong Kong, such as ‘Kwai Tsing Container Terminal’ mainly focus
on the shipping services in Pearl River Delta but not around the world. Hong Kong has
only the ‘Mass Transit Railway (MTR)’. It is relatively slower compared with ‘Maglev
Train’ in Shanghai. Hong Kong’s transportation and infrastructure really puts it at a
disadvantage position.
‘Ageing population’ is the second challenge that Hong Kong should not overlook. Now,
one in eight persons is in the age group of 65 or above. As mentioned in the early Budget
Speech released by the HKSAR, in the coming 20 years, the number of this group rises
