A policy advanced by Beijing for both political and economic purposes, the Greater Bay Area envisions a giant metropolis binding together the 11 major settlements of the Pearl River Delta region. With a combined population fast approaching the 70 million mark and a GDP of some USD1.4 trillion last year, this highly urbanized region is set to become the world’s richest bay area by 2030, beating out rivals in Toyko, San Francisco and New York.
The idea of a Greater Bay Area originated in Shenzhen as early as 1996, but only since 2016 has it been mentioned in Chinese national policy, even if it is rarely given the benefit of elaboration.
In the absence of a detailed synopsis of what the Greater Bay Area will actually entail, the implication of such an enormous project on Macau’s economy belongs firmly in the realm of speculation.
The bay is in some ways a microcosm for a transformation occurring across China, as the country shifts from bread-and- butter manufacturing to a services-based economy.
But nowhere is the shift more evident – and appropriate – as it has been in Guangdong Province, along the coastal areas that make up the Pearl River Delta.
For centuries, this part of China has been the most exposed to outside cultural influences. Not only did westerners settle in the enclaves of Hong Kong and Macau, bringing with them cultural traditions, industrial innovation and religion, but a significant portion of the overseas Chinese diaspora can trace their roots back to Guangdong too.
The young cities of Shenzhen and Zhuhai, just across the border from the two SARs, also make this region particularly fertile for such a project. They owe their rapid growth to the settlement and labor of Chinese migrants, who bring with them a touch of multiculturalism and an interregional, if not international, mindset.
Analysts are now beginning to weigh in on the project – including HSBC’s Greater China CEO, Helen Wong, who gave the “magnificent” project a glowing review recently and described its vision as “not unrealistic.”
“Combining the strengths of these core cities together with rest of the Pearl River Delta cities’ vast resources, spaces and cheaper labor, the Greater Bay Area will see substantial improvement in its strength in global cooperation and competition, and ascend to become an important global city cluster for innovation, finance, shipping and trade,” Wong wrote in an article for Singapore’s Channel NewsAsia.
Though ill-defined in terms of substance, the project will inevitably have wide-ranging implications for Macau and Hong Kong between now and the mid-
century ‘integration’ dates.
One of the most pressing issues is to what extent the Greater Bay Area will compromise economic autonomy in the two regions.
Achieving the policy’s stated goal of accelerating economic integration will no doubt require the lifting of certain market protections and the curtailing of self-governance, as has been the case in the European Union experience.
At the same time, the Macau SAR government will likely want to retain its labor market protections and preferential treatment toward local companies.
This raises interesting dilemmas for Macau, given its village-
It also raises the pertinent question of whether the Greater Bay Area project will pry open lucrative government and casino contracts to firms in the Pearl River Delta region. If it does not, then the area will continue to function as separate, municipal economies, contrary to the idea of a single economic powerhouse.
A future where chemical companies from Jiangmen and design firms from Zhongshan supply the chemical requirements of the Hospital Conde S. Januário and design the interiors of hotel lobbies may be a matter of decades away. Or sooner.
In the long-term, this might create the sort of economic specialization that could truly transform the region into the “important global city cluster” that Helen Wong predicts. But in the near-term, it would likely price out many of Macau’s SMEs and unravel the entrepreneurial spirit that the local government is so keen to encourage.
It might also lead to intense inter-city competition as local rivals vie for the same market niches.
The recently-inaugurated Shenzhen-Hong Kong Stock Connect is a sign that the Central Government is edging the two cities onto equal footing with respect to the financial services industry; a symbolic gesture that could pave the way for future stock market unification.
A tourism rivalry between Macau and Zhuhai might one day become a reality in the south of China too. Disparities in visa requirements, tourist offerings and transportation infrastructure might influence where the Chinese customer chooses to holiday.
Already there are signs of discord over the adjacent island of Hengqin – the tourist development project owned by Zhuhai and financed by Macau, which was supposed to bridge their respective tourism sectors.
The good news is that the tourism offerings of Zhuhai and Macau will eventually come to complement one another. Zhuhai is home to the beaches, natural scenery and most maritime activities, while Macau has its colonial heritage, its gastronomy and its gambling industry. They have been developed with these specialties in mind and – except for Hengqin – the two cities have deliberately avoided stepping on each others’ toes.