PUBLIC POLICY DIALOGUE SERIES 18 makes the situation worse is Hong Kong does not seem to have the capacity to retain talents. Prof. Sung put the question under the context of regime change, he gave an insightful remark that historically, Hong Kong’s fundamental change in the political regime had always led to painful structural adjustment; the exceptionally smooth rst reversion in 1997 marked by continuity rather than disruption was due to myriad of favorable geopolitical factors, but the pain was delayed till the second reversion in 2020 with a shift of these factors. Still, since the megatrends are largely out of our control, Prof. Sung suggested that Hong Kong can only adapt and adjust. He further remarked that the integration of Hong Kong with the GBA has a long history ever since China’s opening in 1979 and has already reaped the fruit, but deep integration will face numerous systemic constraints, and successful cultivation of an environment conducive to high-tech development requires long-term effort. Dr Wendy Hong analogised Hong Kong’s nancial industry with the Wimbledon effect as although Hong Kong is an international nancial centre, there are no local competitive nancial institutions, and all big nancial players are rooted outside Hong Kong. Dr. Hong attributed the IFC’s rootlessness to its overly narrowly focused economic structure, or over- nancialization, in which insuf cient value-added economic activities are being squeezed out. Yet, the impossibility of the nancial sector to provide exclusive development opportunities for all Hong Kongers results in limited quality opportunities for upward social movement. Therefore, she perceived two Hong Kongs in a parallel universe: the “elite HK,” the well-known IFC and super-connector, and the “mass HK,” suffering from the hollowing-out economy, widened wealth gap, and reduced social mobility. Dr. Hong provides some suggestions for overcoming the “Wimbledon effect” in Hong Kong, including rede ning the value of IFC, using the nancial sector as the instrument to achieve policy objectives and diversifying the local economic base, empowering the “mass Hong Kong” by the “elite Hong Kong”, she gave seven policy suggestions regarding Hong Kong’s future development to rethink and rede ne the value IFC by adding local dimensions, such as company re-domiciliation, art-tech fusion, sci-tech, and IP nancing. Prof. Lui gave examples of the proportion and numbers of regional headquarters, regional of ces, and local of ces in the past 30 years, pointing out that the number of regional headquarters, which is the major component of the economy emphasised by the HKSAR government, has been stagnant from 2009 and dropped in 2022; on the other hand, the composition of these regional headquarters show that international headquarters dropped while mainland China occupies the largest share in Hong Kong. Prof. Lui invited the audience to think about why Hong Kong would be the chosen platform to set up regional quarters and what Hong Kong’s competitiveness is to take over all those opportunities. He suggested that there should be assessment tools (e.g., KPIs) to gauge Hong Kong’s competitiveness and delineate Hong Kong’s future economic performance and market response to improve Hong Kong’s international pro le.
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