Oct 1 marked the 75th anniversary of the establishment of the People’s Republic of China. Speaking at a reception commemorating the anniversary, President Xi Jinping said that “the path ahead will definitely see challenges”, before calling on the country to overcome uncertainties and risks. President Xi also said that “no challenges can stop China’s progress”.

Xi also added that China would “spur” the development of China’s two special administrative regions, Hong Kong and Macao, both governed under the “one country, two systems” principle.

Even though China faced many challenges in the last 75 years, experiencing a bumpy ride, it is undeniable that the outcome is remarkable and definitely far better than many would have expected seven-and-a-half decades ago.

China is the world’s second largest economy by nominal GDP, behind the United States, and since 2017 has been the world’s largest economy when measured by purchasing power parity (PPP). China accounted for 19 percent of the global economy in 2022 in PPP terms, and around 18 percent in nominal terms in 2022. China’s GDP has continued to grow, and by 2023, was 223 times larger than in 1952 calculating at constant price, with an average annual growth rate of 7.9 percent. China’s GDP per capita has increased significantly and the country’s comprehensive national strength has grown to occupy the world’s top position.

Also, and this is one of China’s most remarkable achievements, according to the World Bank’s data, more than 850 million Chinese people have been lifted out of extreme poverty; China’s poverty rate fell from 88 percent in 1981 to 0.7 percent in 2015, as measured by the percentage of people living on the equivalent of $1.90 or less per day in 2011 PPP terms. As a matter of fact, on Nov 23, 2020, China announced that it had eliminated absolute poverty nationwide by uplifting all of its citizens above the 2,300 yuan ($328) per year low income threshold (in 2010 constant prices).

When it comes to sustainable development, China has reduced its dependence on coal: China’s goal is to reach its carbon emissions peak before 2030 and become carbon neutral before 2060, as listed in the 14th Five-Year Plan (2021-25) for National Economic and Social Development and the Long-Range Objectives through the Year 2035.

Both of China’s objectives are crucial for achieving green development. By way of comparison, the US and the European Union aim to achieve carbon neutrality by 2050. If they meet their targets, it will have taken the US around 45 years and the EU around 60 years to move from their carbon emissions peak to achieve neutrality, but China plans to do it in just 30 years, which is a very ambitious, yet reachable, goal.  

Most of these achievements were thanks to China’s gradual opening-up. Deng Xiaoping initiated major economic reforms four decades ago, and the accession of China to the World Trade Organization 22 years ago marked a milestone in the country’s reform and opening-up to the world as well as its bet on globalization and free trade as opposed to unilateralism and protectionism.

China’s economic growth has placed the country as the world’s second-largest economy as well as a tech powerhouse, having made achievements such as eliminating absolute poverty. Hong Kong, as one of China’s two special administrative regions and governed under the “one country, two systems” principle, has the potential to help the country grow even more by leveraging projects like the GBA and by maintaining and enhancing its role as one of the world’s most important financial centers

Much is being written about China’s current economic slowdown. But even if the country’s economic growth slowed to 4.7 percent in this year’s second quarter (although overall growth for the first half of the year stood at 5 percent, in line with the GDP target for 2024), and even if China’s property slump continues as investment in the sector dropped 10.1 percent in the first six months of this year compared to 2023, the truth is that the global economic situation remains unstable, yet China has the means to overcome the current issues and emerge stronger.

To focus on Hong Kong, in 1992, when Deng embarked on his “Southern Tour” of China, visiting Guangzhou, Shenzhen, Zhuhai and Shanghai, he permanently changed China’s direction toward free market economic development, pointing out how this area would be a game changer in future. The “Southern Tour” was considered the final great political act of Deng’s career.

In this sense, Hong Kong has a key role to play in China’s present and future.

As I have mentioned in multiple articles, Hong Kong underwent the Asian financial crisis, SARS, the global financial crisis, and the COVID-19 pandemic without diminishing its role as one of the world’s most important financial centers. And this was so because of Hong Kong’s strength and its resilient nature.

While Hong Kong has indeed been through some rough years, its attractiveness has not diminished at all, to the point that the city remains one of the world’s most important financial centers.

Hong Kong recently ranked third globally in the Global Financial Centres Index (GFCI) 36 Report published by London-based Z/Yen and the Shenzhen-based China Development Institute, moving up one place from the March issue of the index. Hong Kong also ranked first in the Asia-Pacific region. The city’s overall rating increased by eight points, the largest improvement among the top five financial centers. The GFCI Report has been released in March and September every year since 2007. In GFCI 36, 121 financial centers were assessed, and Hong Kong achieved an overall rating of 749.

Hong Kong has the potential to help the Chinese mainland via projects like the Guangdong-Hong Kong-Macao Greater Bay Area, among others.

The GBA has been called “China’s Silicon Valley” by some media outlets, and not without reason. Suffice to say that the GBA has the potential to bring more economic growth, new jobs and therefore prosperity to the region.

Each of the GBA’s 11 cities will play an important role based on its respective strengths. For example, Hong Kong will play a key part as a financial center, while Shenzhen, where cutting-edge technology companies Huawei and Tencent are based, will leverage its technological prowess.

Hong Kong is embracing opportunities from the GBA’s development, and, by playing an active part in the national 14th Five-Year Plan, the HKSAR is unleashing its potential thanks to unreserved support from the central authorities for advancing key strategies to upgrade its superconnector role, including the digital renminbi and environmental, social, and governance matters.

In addition to the role that the GBA will play in Hong Kong’s future, we can also mention other opportunities such as fintech development in Hong Kong, the HKSAR’s anticipated entry into the Regional Comprehensive Economic Partnership, and various Connect Schemes.

Hong Kong and the rest of the GBA are increasing their role as fintech hubs. The Fintech 2025 blueprint aims at pivoting the HKSAR toward a friendlier regulatory regime for digital assets, proving that the city is positioning itself to become a virtual assets center/crypto hub.

To sum up, China’s economic growth has placed the country as the world’s second-largest economy as well as a tech powerhouse, having made achievements such as eliminating absolute poverty. Hong Kong, as one of China’s two special administrative regions and governed under the “one country, two systems” principle, has the potential to help the country grow even more by leveraging projects like the GBA and by maintaining and enhancing its role as one of the world’s most important financial centers. At the end of the day, when Hong Kong thrives it is not only good for Hong Kong but for the whole of China.

The author is a fintech adviser, researcher and former business analyst for a Hong Kong publicly listed company.

The views do not necessarily reflect those of China Daily.