GCC Submission on the 2024 Chief Executive’s Policy Address
Travel, Tourism, and Greater Bay Area
- (Lobby the Mainland authorities to) Extend the validity of the Mainland Travel Permit ("Permit") to Hong Kong residents. The recently announced Permit is a very welcome move that will facilitate easier and thus more frequent travel between Hong Kong and the Mainland. By its nature however, it cannot bring new people to Hong Kong as it is tied to PRI status.
We understand that relaxation of the travel rules is a complex issue and one that will need to proceed step by step. Yet, we believe it would significantly enhance the attraction of Hong Kong if it can position itself as the "commuter city" of the GBA. Currently there are ca. 500 German companies based in Guangdong province, many of whom report difficulties in attracting H/O staff to move to the Mainland. The proposed measure would allow many of these companies to offer their staff to move to Hong Kong and work in the Mainland. This would also serve to showcase the quality of the infrastructure connecting Hong Kong and the GBA cities (many Germans are used to one-hour commutes (one way), e.g. Guangzhou and Dongguan can be reached on a daily basis within that 1 hour commute).
To ensure that the measure is introduced in a careful manner, it can (initially) be tied to a separate pre-vetting / authorisation process (that however should require no more than HK residence to ensure it appeals to new movers). - "Package" Hong Kong and defined GBA cities as “Greater Bay Discovery” tours. As a stand-alone tourism destination, Hong Kong's attractiveness to European tourists is limited due to the long travel time relative to the available sights. Mainland China tours on the other hand are perceived as "standalone" trips and suffer from skepticism about accessibility (payments, language).
We believe that by offering combined tours that target specific audiences, the overall attractiveness of both locations can be enhanced. The goal is to create integrated travel experiences that draw international visitors through Hong Kong, using the city as a "can't miss" gateway. A possible motto for this could be "one stop - four destinations". - Whilst the many “mega events” that continue to take place are much appreciated to establish a “groundswell” of happenings, with the upcoming opening of Kai Tak Sports Park, we believe there is a “window of opportunity” to host a truly global “World Class Event”. This could be used to bring the Park on the map and generate positive media coverage internationally.
- The term “GBA” itself and the concept of the GBA continues to be little known in German business circles. While many German companies are active in the GBA , many in Hong Kong and several in both locations, the specific benefit that coming to the GBA via Hong Kong brings is not clear.
German companies in the Mainland are predominately active in manufacturing. The biggest discernible benefit for new companies to access the Mainland via Hong Kong would be if they are incentivised to set up a "trial run" in Hong Kong with a clear road-map to scaling production in the Mainland once the concept has been proven. Some such concepts already exist (eg. in the field of AI use in manufacturing).
We encourage the government to actively identify those foreign-led manufacturing ecosystems in the GBA that are adding capacity and identify which parts of the ecosystem can benefit from starting out their operations in Hong Kong.
Professional / Academic Education and Retention
- For forty years now, German Industry and Commerce and various Hong Kong based German companies have been offering Dual System Professional Training according to accepted German standards.
Whilst many of the graduates of this programme go on to university (and continue to act as "Brand Ambassadors" for Hong Kong), quite a number of the graduates wish to continue with their employers in Hong Kong. However, in many cases they are denied work visas on the basis that a dual vocational training does not equate to a university degree. Whilst this is formally correct, we urge the Government to consider giving equivalence to designated professional trainings and to include the German vocational training amongst these.
A blueprint for this already exists in the “Vocational Professionals Admission Scheme (VPAS)” offered in conjunction with the VTC. This would go a long way to ensuring that German companies here benefit from an optimal mix of talents suited to their needs, thus adding to the city's attractiveness as a location for German businesses. - Training and Upskilling Programs: Suggest the implementation of government funded training and upskilling programs tailored to the needs of the manufacturing (GBA) / trading (HK) sectors. These programs should focus on equipping workers with the latest skills and knowledge, making them more valuable to their employers and reducing turnover rates (e.g. training them on the legal, manufacturing and Fit For Use (FFU) needs or the countries of intended sales of the goods which are produced).
- Continuous Learning Opportunities: Offer continuous learning opportunities for existing employees to keep their skills up to date. This can include online courses, workshops, and certifications in relevant fields.
- Career Development Opportunities: Encourage SMEs to invest in career development programs that provide clear pathways for advancement. This can include mentorship programs, leadership training, and opportunities for further education.
- While we appreciate the "Top Talent" scheme as a well-suited way of encouraging talents to move to Hong Kong, we believe some refinements to the programme are possible. For one part, we note the press reports that indicate that the number of universities to be recognised under the scheme is set to increase.
For Germany, when reviewing the existing universities, we note that a number of (sometimes smaller ) universities that are very highly regarded for their Finance degrees are missing from the list. As Finance continues to be an area where Hong Kong enjoys a very strong brand globally, we recommend focusing on those universities when expanding the list. - In addition to "catching" graduate students via the Top Talent scheme, we believe that it is also worthwhile to attract students at an earlier stage. The ideal way to achieve this is to incentivise (German / European) companies to offer (summer) internships to students, in particular targeting those from Top Talent universities. This incentivisation need not necessarily be pecuniary, it can also take the form of appreciation / "bonding" events that recognise the company's contribution and allow the interns to see themselves as part of larger group. To operationalise this, HK Talent's remit could be extended to identifying companies (actually or potentially) offering internships and designing measures to enhance the internship experience for companies and interns alike.
SMEs
- Enhanced Financial Assistance: We propose the introduction of targeted financial assistance programs specifically for SMEs in the manufacturing / trading sector. This could include low-interest / interest-free loans, grants and subsidies to help these businesses manage cash flow issues, invest in new technologies, and retain skilled employees. Again, this can include funding for research and development, as well as for implementing sustainable practices. All that while simplifying the access to the above-mentioned resources, as today is extremely complex and exceedingly bureaucratic to access the available programs.
- Tax Incentives: Offer tax incentives for SMEs that invest in innovation, employee training, and sustainable practices. This can help reduce the financial burden and encourage long-term growth (e.g. x% of tax reduced as soon as you can prove you have invested this money on people development or similar positive impact projects).
- Resource Sharing: Recommend the creation of platforms that facilitate resource sharing and collaboration among SMEs. This could include shared access to manufacturing (GBA focused) / trading facilities, equipment and skilled labour pools, helping to reduce costs and improve efficiency.
- Collaborative Networks: Develop networks and forums where SMEs can collaborate, share best practices and form partnerships. This can foster innovation and provide opportunities for joint ventures and co-development projects. This with the support of the Chambers and intra-Chambers activities and the involvement of the institutions (e.g. by hosting events).
- Encouragement of Digital Transformation: Propose initiatives supporting digital transformation for Hong Kong businesses, especially SMEs. This could include providing subsidies for adopting digital tools, fostering innovation hubs, and promoting collaboration between Hong Kong companies and German tech firms.
Finance
- We suggest to raise the issue of Hong Kong's participation in the Sino-German Financial Dialogue (第三次中德高级别财金对话联合声明) with the convernors of the Dialogue. The city's excellent reputation as an International Financial Centre and as "Green Finance Centre" would in our view add substantial benefit to the Dialogue for both Germany and the Mainland.
Ecology and Sustainability
- Promote Waste Reduction: Advocate for expanding waste reduction efforts rather than relying on incineration. Introduce policies for eliminating single-use products and promote recycling initiatives to stimulate the local green job market.
- Building Decarbonisation: Mandate energy utilization disclosure for buildings to drive down carbon emissions. Encourage property developers to enhance building energy efficiency, aligning with Hong Kong’s sustainability goals.
- Sustainable Aviation: Establish targets for sustainable aviation fuel use and set up local blending facilities, maintaining Hong Kong's competitiveness in ecofriendly logistics.
- Hydrogen-Powered Public Transport: Building on the recent introduction of hydrogen buses in Hong Kong, further investment in hydrogen-powered public transport is recommended. Expanding the supporting hydrogen fuel infrastructure will solidify Hong Kong’s leadership in green transport. By collaborating with industry leaders, the city can accelerate the adoption of hydrogen technology and reduce its carbon emissions, while stimulating green innovation and creating opportunities in manufacturing and logistics.
