What are the six dominant industries in Hong Kong?

How severe is Hong Kong's economy? Just a set of data has already seen the clue. According to the latest forecast of the Hong Kong Government, the annual GDP of Hong Kong will shrink by 6. 1% in 2020, which is even worse than that of the Asian financial turmoil 1998 (-5.9%), the SARS in 2003 (+3. 1%) and the subprime mortgage crisis in 2009 (-2.5%). If nothing happens, it will be the worst on record.

The biggest economic recession in history has once again revealed the long-standing structural problems of Hong Kong's economy. Hong Kong is the world's leading international financial center, with top universities in Asia, the largest legal service system in Asia and an important international trade port. Hong Kong's service industry accounts for nearly 99%, and there is almost no industry. The financial industry in Hong Kong, which accounts for 18.9%, has only created 6.8% jobs, while the professional service sector has created 14% jobs. During the SARS in 2003, the unemployment rate in Hong Kong was as high as 8%. After that, the mainland opened up "free travel" and created a large number of new jobs, but most of them were concentrated in low-end jobs in retail, hotels, restaurants and other industries.

Most of the new jobs created by "free travel" in the mainland are concentrated in low-end jobs in retail, hotels, restaurants and other industries.

Hong Kong is not without opportunities to develop its manufacturing industry. In the second half of last century, the rapid development of Hong Kong's economy benefited from light industry, and the industrial output value once accounted for nearly 30% of GDP.

However, after the reform and opening up in the Mainland, capital began to be naturally selected, and Hong Kong's light industry gradually moved northward to the Pearl River Delta region where business costs were lower. However, Hong Kong did not give up manufacturing immediately, but made efforts to upgrade its industry. From 65438 to 0999, Zhang Rujing, who left TSMC, and Dalin Xu, a venture capitalist from Handing Asia Pacific, both wanted to implement the "Silicon Port" plan in Hong Kong, but they were questioned by public opinion as "speculation", and the Hong Kong government finally failed to allocate land. At the same time, Shanghai attracted this plan with almost rent-free and five-year tax-free preferential measures, and established "SMIC", which has now developed into a chip manufacturer with a total market value of more than 400 billion. Hong Kong, which missed the industrial upgrading, tried not to interfere in the economy under the guidance of the government's "neo-liberal economy". New profits spill over to the real estate industry, land prices are rising, and the cost of developing industry becomes higher. The single industrial structure also increases the fragility of the labor market. The overall unemployment rate in Hong Kong rose rapidly from 2.8% in 20 19 to 6.3% in September 2020, reaching a new high since 16. If 202 1 fails to recover due to epidemic and other troubles, the unemployment rate may further challenge the historical high of 8.5% during the SARS period in 2003. The Hong Kong government has also taken into account the disadvantages of industrial simplification. After the financial crisis in 2008, Donald Tsang, then Chief Executive, put forward a plan to develop six dominant industries, including cultural creativity, education, medical care, environmental protection, testing and certification, and innovative technology, but the development was not smooth. 10 years later, their proportion in GDP is still single digits.

Land prices in Hong Kong are constantly high, and the cost of developing industries is even higher.

There is no high-end manufacturing industry in Hong Kong, and the financial industry may be replaced. What are the economic prospects of Hong Kong?

Carrie Lam Cheng Yuet-ngor)2020 mentioned Guangdong-Hong Kong-Macao Greater Bay Area 45 times in the 2020 policy address, and the prescription for the local economy can be roughly summarized in two directions: continuing to integrate into the economic cycle of the Mainland at home and making efforts to participate in international trade agreements and cooperation such as RCEP abroad.

Cai Hongbin, a professor at Hong Kong University who has been observing Hong Kong's economic development for a long time, pointed out that Greater Bay Area has indeed created another possibility, but it should not be another excuse for the inaction of the Hong Kong Government. For Hong Kong, the most important thing is to solve its structural problems first. "Dongguan, Foshan and other cities in the region can also rely on Greater Bay Area. What are the advantages of Hong Kong? "

Long before the outbreak of the epidemic, Cai Hongbin warned that Hong Kong's economy was entering a "technical recession", the main crux of which was that the industrial structure was too simple, and suggested promoting economic transformation as soon as possible. More than a year later, he admitted that he did not see the SAR begin to reform. There is nothing new in the policy address, and there is no positive plan.

Cai Hongbin said that Hong Kong's pillar financial services and trade logistics are unsustainable under the disintermediation of the digital revolution, but Hong Kong has no advantages in data, market and talents in scientific and technological innovation. Therefore, Hong Kong should transform and develop high-end service industries focusing on medical care, education and cultural innovation in the future. In order to release the supply capacity of these industries and introduce international demand, the government needs to make great efforts to carry out institutional innovation.

Deng Xiwei, another professor at the University of Hong Kong, also believes that the Hong Kong government should be more active and continue to adhere to the attitude of "big market, small government", which will only lead to piecemeal policies and fragmented policies.

Deng Xiwei further explained that in the absence of market failure, the positive non-intervention policy is appropriate, but when the market fails seriously, it is necessary for the government to change its course. In the past, the Hong Kong government emphasized the four major industries, but in recent years, only finance and real estate have promoted economic growth, resulting in a serious imbalance between income and wealth. The best way is the third economic transformation. In this regard, the direction of the Hong Kong government is correct, but excessive non-intervention leads to scattered policies, overlapping measures and lack of long-term planning, which leads to failure to grasp the key points and one-sidedness.

In recent years, Hong Kong's economic growth mainly comes from finance and real estate.

In addition to the structural transformation of Hong Kong itself, the game between China and the United States will also be an important factor affecting the development of Hong Kong. Recently, many new cabinet officials in the United States still regard China as the most important challenge in their speeches. It is expected that Sino-US relations will still be full of intractable differences in the future.

In this regard, Yu Pinhai, the founder of "Hong Kong 0 1", said in his speech at the "2020 Economic Summit Forum" that if Hong Kong responds properly, it actually has good conditions to turn the crisis into an opportunity and take advantage of the situation to further upgrade and transform Hong Kong's economic structure.

The first is the financial aspect. The earlier crackdown by the United States on Chinese-funded enterprises listed locally is an example of turning crisis into opportunity. In the past six months, many China enterprises returned to Hong Kong for listing, which led to the sustained and vigorous development of Hong Kong's securities market last year. Hong Kong is also the center of offshore RMB business, handling more than 70% of global RMB trade settlement. Hong Kong will have great development potential in RMB investment and risk management products business.

The second is innovative technology. The strength of basic scientific research in Hong Kong is top-notch, and five universities rank among the top 100 in the world, with advantages in biomedicine and artificial intelligence. In the process of developing Greater Bay Area into an international innovation center, Hong Kong can play a unique and important role.

Finally, trade. In the past year or so, although the United States has repeatedly targeted Hong Kong in trade, in fact ASEAN has already replaced the United States as a more important trading partner of Hong Kong. So far, the Hong Kong Government has signed eight free trade agreements with 20 economies, and actively strives for RCEP to join. Hong Kong businessmen and investors can make good use of the preferential treatment of the agreement, explore business opportunities in these emerging markets, seize the "double cycle" opportunity in the Mainland, and actively participate in the domestic demand market in the Mainland.