Taiwan and Hong Kong could benefit by working together to tap into China’s economic transformation, experts and officials suggested yesterday at a forum in Taipei.
The two sides are economically complementary, said John Leung (梁志仁), director of the Hong Kong Economic, Trade and Cultural Office (Taiwan), which organized the forum along with the Taiwan-based weekly Business Today.
Noting a variety of bilateral memorandums of understanding have either been signed or under negotiation, Leung said Taiwan and Hong Kong should consider a pact similar to the Economic Cooperation Framework Agreement that Taipei and Beijing signed in 2010 to help promote trade and investment.
Hong Kong Under Secretary for Financial Services and the Treasury Julia Leung (梁鳳儀) suggested working together to create an offshore Chinese yuan market for the Greater China region.
With a rapidly expanding market of products denominated in the Chinese currency, Taiwan could learn from Hong Kong’s years of experience developing businesses in that area, she said.
Former minister of finance Christina Liu (劉憶如), now managing director of Hong Kong-based consulting firm Bellwether International Group, said Taiwan and Hong Kong could pair up to create attractive Chinese yuan products that target the global market.
Hong Kong can benefit from working with Taiwan based on the penetration of Taiwanese businesses across Southeast Asia and their demand for funds, she said.
Taiwanese economist Ma Kai (馬凱) said teaming up could help both sides collectively surpass China.
Besides the advantages of the judicial systems in both places, Hong Kong’s strength is its service sector and position as a financial and trade hub, while Taiwan has a comprehensive industry chain in the manufacturing sector, Ma said.
Taiwan should now focus on speeding up efforts to open itself and build efficiency, like those in Hong Kong and Singapore, to prevent its marginalization as a result of China’s free-trade zone project in Shanghai, he added.
Moreover, Taiwan needs to shift its approach to economic growth instead of relying on manufacturing in China, which has seen its strength in the manufacturing sector wane in the past two years, he said.
However, when asked about Taiwan’s prospects of posting economic growth of 2 percent or higher this year, Ma expressed pessimism, while Liu declined to comment.
The Chung-Hua Institution for Economic Research (中華經濟研究院) cut its prediction for the nation’s economic growth this year to 2.01 percent on Tuesday, the lowest forecast to date by a local think tank.