After years of exploration, discussion and debate, the central government and Hong Kong society have agreed on the city’s development strategy under the new internal and external environment. The resolution of the fourth plenary session of the 19th Communist Party of China Central Committee, President Xi Jinping’s expectations and requirements for the future development of Hong Kong, the national 14th Five-Year Plan’s (2021-25) arrangements for Hong Kong, Director of the Hong Kong and Macao Work Office of the Central Committee of the CPC Xia Baolong’s instructions to the Hong Kong Special Administrative Region government, and the resolution of the third plenary session of the 20th CPC Central Committee all attest to the fact that the central government has drawn up a blueprint for the SAR’s future development. This blueprint has contributed to the gradual formation of an internal consensus on the direction of Hong Kong’s future development.

After taking office in 2022, the incumbent Hong Kong SAR government has been actively implementing this strategic consensus in setting its policy direction. The core of this policy strategy under the leadership of the proactive and result-oriented SAR government is to gradually abandon the outdated thinking of “small government, big market”. The government is devoted to implementing several significant policies through progressive reforms, including accelerating integration into overall national development, expanding Hong Kong’s international economic, trade and financial space, strengthening Hong Kong’s traditional industries, cultivating emerging industries, strengthening the connection between traditional industries and emerging industries, and improving people’s livelihoods under the principle of promoting social fairness and justice.

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On Wednesday, Hong Kong Chief Executive John Lee Ka-chiu released his third Policy Address, proposing many specific policies and measures to further Hong Kong’s development.

Regarding accelerating integration into overall national development, the policy focus is for Hong Kong to more actively participate in Guangdong-Hong Kong-Macao Greater Bay Area development. Specific policies and measures include strengthening cooperation with other GBA cities in air and passenger transportation and issuing the Development Outline for the Hong Kong Part of the Hetao Shenzhen-Hong Kong Science and Technology Innovation Cooperation Zone, setting out innovative policies to facilitate mutual access between the two parks.

In terms of expanding Hong Kong’s international economic, trade and financial space, the government will further strengthen Hong Kong’s economic and trade ties with countries participating in the Belt and Road Initiative, especially with countries in Southeast Asia and the Middle East.

Many initiatives will be introduced to strengthen Hong Kong’s traditional industries. In terms of the financial sector, they include developing an international gold trading market and world-class gold storage facilities, implementing an array of measures to attract new capital and products to the stock market, including more renminbi-denominated products, and better utilizing the currency swap agreement with the Chinese mainland to enhance offshore RMB liquidity.

In terms of the shipping industry, the government will establish the Hong Kong Maritime and Port Development Board to strengthen research capacity and promotional efforts on the mainland and overseas. It will also create a commodity trading ecosystem, introduce tax concessions, and encourage international commodity exchanges to set up accredited warehouses in Hong Kong, and promote the development of high-value-added maritime services such as shipbroking, financing and leasing, naval insurance, maritime law and arbitration.

Regarding trade, the policies and measures include actively promoting the development of a headquarters economy to bring in strategic enterprises from outside Hong Kong and reducing the duty rate for liquor to promote liquor trading and related economic activities.

Regarding tourism, the policies and measures include tasking the West Kowloon Cultural District to steer the establishment of an industry chain of the arts and culture and creative industries in Hong Kong, promoting cultural and creative tourism, and building the Kai Tak Sports Park into a sports and mega-events landmark.

In terms of cultivating emerging industries, the policies and measures include formulating medium-to-long-term development plans for new industrialization in Hong Kong, facilitating the development of the Hong Kong New Industrialization Development Alliance to promote collaboration among the government, industry, academia, research and investment sectors, increasing investment for research-and-innovation and technology industries, formulating low-altitude economic development strategies, developing Hong Kong into an international hub for postsecondary education, promoting the development of the silver economy, and publishing the Chinese Medical Development Blueprint next year to facilitate the internationalization of Chinese medicine.

In strengthening the connection between traditional and emerging industries, emerging industries will help traditional industries to become digitalized, high-tech savvy and green, especially in the financial and shipping sectors.

In terms of promoting social fairness and justice, the Policy Address proposes to improve people’s livelihoods, including increasing the total public housing supply in the next five years to 189,000 units, legislating for a regulatory regime on the renting of subdivided residential units, enhancing the housing ladder, gradually raise the supply ratio of subsidized sale flats, streamlining land development procedures and use technology to bring down construction costs, promoting all-around development of primary healthcare, supporting the plan for establishing a third medical school by local universities, and adopting more measures to care for older people and those with disabilities.

To implement the new policies and measures in the Policy Address, the government will add four new cross-bureau coordination mechanisms led by secretaries and deputy secretaries of government departments.

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Although the Policy Address did not touch upon very significant system and policy reforms, the policies and measures it proposes are consistent with those proposed and implemented in the past two Policy Addresses because they are cumulative and complementary. Their combined effects will inevitably produce positive policy effects, which are of significance for realizing Hong Kong’s development strategy, promoting the transformation and upgrading of its industries, improving people’s livelihoods, and increasing the happiness of residents in the long run. In other words, it can be said that the government is pursuing a prudent and progressive reform strategy.

Considering that the country’s and the SAR’s economies are still in a difficult period, and after years of deficit budgets, the SAR government’s fiscal resources are constrained, it will not be easy for the new Policy Address to propose too many critical policy innovations. Indeed, incremental reforms cannot significantly impact Hong Kong’s long-standing economic and people’s livelihood problems and pain points in the short term. Changes in the international situation, especially the endless efforts of the United States and the West to contain the country and Hong Kong, will continue to be challenging. Nevertheless, positive results will continue to come if the progressive reforms can be sustained and incessantly improved. The intensity and scope of reforms can increase when better opportunities and conditions arise to lay a solid foundation for even more effective implementation of Hong Kong’s development strategy and promote its long-term prosperity, stability and progress. From this perspective, the country’s 15th Five-Year Plan (2026-31) will be an excellent opportunity to consider Hong Kong’s future reform direction seriously.

Of course, before promoting more major system and policy reforms, the SAR government must conduct rigorous policy research and conduct extensive discussions with the central government and all sectors of Hong Kong society to ensure implementation on a sound basis.

The author is a professor emeritus of sociology, the Chinese University of Hong Kong, and a consultant for the Chinese Association of Hong Kong and Macao Studies.

The views do not necessarily reflect those of China Daily.