Hengqin New Area Expands Room for Macao’s Development

By+staff+reporter+LUO+YUANJUN

HENGQIN New Area was es- tablished on December 16， 2009 in southern Zhuhai City， Guangdong Province. Covering 106.46 square kilometers， it triples the size of Macao. Across a river from each other， the two are connected at their shortest distance by a bridge less than 200 meters long. Hengqin is 34 miles from Hong Kong. After the opening of the Hong KongZhuhai-Macao Bridge， scheduled for 2016， Hengqin will become the only national new area directly connected to Hong Kong and Macao.

A Seamless Link： Guangdong and Macao

Our China Today reporter happened to sit at the same table as businessman He Zhiyuan from Macao， while having breakfast at a Zhuhai hotel. He runs a factory in Zhuhai that produces traditional snacks under the “Macao Specialty” label.

“In fact， most ‘Macao Specialty products are made in Zhuhai because Macao is so small， covering only 29 square kilometers. If you want to expand your business， you have to build your production base in Zhuhai，” said He Zhiyuan. He works in Zhuhai on weekdays and rejoins his family on weekends. His car license plate has dual registration for Macao and Guangdong， making travel back and forth quite convenient.

Over the past few years， communications between Chinas mainland， Hong Kong and Macao have grown closer. The establishment and construction of Hengqin New Area came just at the right time. “The development of Hengqin accords with the need for deeper cooperation between Chinas mainland and Hong Kong and Macao. The area provides an important new platform for further cooperation between the three regions. The construction of Hengqin is also a national strategy to implement the‘one country， two systems policy， and to maintain the long-term prosperity and stability of Hong Kong and Macao，” said Edmund Ho Hau Wah， former chief executive of Macao Special Administrative Region （MSAR）.

“In the past， communication and exchanges between Macao and the mainland were not so common. Because commodity prices were lower on the mainland， Macao residents often traveled here to shop. Since raw meat was forbidden at customs， we often halfboiled the meat we took back to Macao. Now that goods fl ow smoothly between the mainland and Macao， commodity prices in Macao almost match those of the mainland. The contributions of the mainland guarantee the wellbeing of Macao people，” said He Zhiyuan.

To explore new cooperation modes between Guangdong， Hong Kong and Macao is a noble goal for Hengqin New Area. The new campus of the University of Macao （UM） in Hengqin is a successful example of cooperation between Guangdong and Macao. UM Rector Zhao Wei shares his view of Hengqins contribution to the project： “Our new campus covers an area of over 1，000 mu（66.7 hectares）. The land was acquired from many local families. I can imagine the difficulty and lengths local officials underwent to acquire the land in so short a time. I am aware that people in Hengqin have made great sacrifi ces. All I can say here is， thank you， thank you very much.”

The UM Hengqin campus is a first in Chinas history， where an area on the mainland is administered by an administrative organization from a special administrative region. “It is a great initiative under the ‘one country， two systemsframework. Moreover， it is an important move that shows our support for Macaos long-term prosperity and stability. The implementation of the project has won approval from all walks of life in Macao. The project shows the Chinese central governments support for Macao， achieving very good results，” said Niu Jing， director of the administrative committee of Hengqin New Area.

On September 25， 2013， the first China UnionPay multi-currency card was launched in Hengqin. As an innovative step in China， cardholders can now settle accounts in non-RMB currencies such as the Hong Kong dollar and MOP（Macao Pataca） in Hong Kong， Macao and foreign countries. Cardholders in Hengqin can add MOP onto new cards and spend money in Macao at a simple swipe of the card. They can also use multi-currency credit cards to fi rst pay in Macao， and then pay off the credit card in MOP when they get back to Hengqin. The whole process avoids the trouble of currency conversion and the risks of carrying cash. Through such bankcard payments， Guangdong and Macao have become seamlessly connected with each other.

New Opportunities for Macaos Development

On March 6， 2011， at the Great Hall of the People in Beijing， Guangdong Province and Macao SAR signed a framework agreement on cooperation. The agree- ment focused on expanding the scope and raising the level of cooperation between Guangdong and Macao. The agreement especially notes that the two sides should work together to develop Hengqin New Area.

The development and construction of Hengqin creates favorable conditions for building Macao into a world tourism and leisure center， accelerating the pace of moderate economic diversification while promoting sustainable development of Macao. Furthermore， Hengqin provides brand new opportunities to Macao residents in terms of employment， study and living， as well as to Macaos enterprises in terms of development.

“Hong Kong-Macao cooperation is the lifeline for the development of Hengqin，” said Niu Jing. “We have been trying to extend interaction and maximize interest through all-round cooperation between Hong Kong， Macao and Guangdong. We aim to unite the power of the three for coordinated development.” By the end of 2013， 98 Hong Kong and Macao enterprises had been registered in Hengqin， with a total investment of about US $3.267 billion， which includes 39 Macao enterprises， with a total investment of about US $411 million. There are 89 more Macao enterprises in the application process.

Moreover， Hengqin provides five major projects to benefit Macaos small and medium-sized enterprises （SMEs）： the Chime Long Commercial Street， Hong Qi Village Commercial Street， Lijun Friendship Square， Xin Jiayuan Commercial Street and the Traditional Chinese Medicine Scientific Industrial Park. Two Macao companies have entered into Chime Long， and three into Xin Jiayuan. Those projects offer ideal venues for SMEs to join together to take root， sprout and grow strong.

The Youyue Business Services Company is the first Macao enterprise approved by the Hengqin New Area Industrial Development Bureau to register in Hengqin. “When my friends heard I wanted to establish a company on the mainland， they all told me I should hire a professional to deal with the administrative procedures， which could take several months. It never occurred to me it would take only one day to complete the registration in Hengqin. They are very efficient，” said Qiu Yuzhen， owner of Youyue. From November 1， 2012， Hengqin New Area has been entitled to exercise approval rights to register enterprises from out of the mainland at the city level and some at the provincial level. These enterprises therefore enjoy one-stop service to complete registration in Hengqin New Area.

In terms of the preferential tax policy， eligible companies will be entitled to a corporate income tax of only 15 percent. The exchange of goods among companies in Hengqin is exempt from valueadded and consumer taxes. Enterprises in Hengqin engaged in scientific research and development， design， logistics and service outsourcing enjoy taxfree status on equipment and machinery they need to import， but they should be filed with the authority.

In order to achieve seamless infrastructural links with Macao， Hengqin has endeavored to build a transportation network to connect Hengqin and Macao. Hengqin port is going to be built into a transportation hub， to become one terminus of the Zhuhai-Macao light-rail. Now， first-phase construction of Hengqin port is scheduled for completion by the end of June 2014. During the transition， old facilities will be demolished and new ones built， while the port continues services without affecting the entry and exit of goods and people.

Human resources are a fundamental guarantee for long-term and sustainable development. According to Liao Jingshan， director of the Hong Kong and Macao Affairs Office of Guangdong Province， in the future Guangdong and Macao will draw on the experiences of the UM Hengqin campus to actively explore a new cooperation mode in higher education between the two sides. They will enhance cooperation in education and cultivation of human resources to meet the demands of Macaos sustainable development and of bilateral cooperation， as well as provide strong support for the regions long-term development.

Macaos Economy and Finance Secretary Francis Tam Pak Yuen believes in Hengqin New Areas close relations with Macao. If travel through customs becomes more convenient in the future， Hengqin could become an ideal residen- tial area for Macao people. Hengqin expands room for the development of Macao， and new construction projects will create more job opportunities. “Many Macao people can find jobs in Hengqin， therefore Macao residents should be farsighted about Hengqins development，”Yuen said.

New Starting Point for Zhuhais Reform

On August 14， 2009， the State Council approved the Overall Development Plan for Hengqin. Hengqin is positioned as a demonstration zone to explore a new cooperation mode between Guangdong， Hong Kong and Macao， under the “one country， two systems” policy – as a pilot zone for deepening reform and openingup， and innovation in science and technology， as well as a new platform for promoting industrial upgrade in the region west of the Pearl River Estuary. At the end of 2012， President Xi Jinping made an inspection tour of Guangdong Province， where he expressed hope that the construction of Hengqin would help explore a new cooperation mode and innovate systems and mechanisms for deepening Guangdong-Macao cooperation while maintaining long-term prosperity and stability of Macao.

“First-tier Management” is implemented between Hengqin and Macao， while “Second-tier Management” has been set up between Hengqin and the interior. The guidelines also include separating management of people and goods. The differentiated management of customs clearance in Hengqin forms a special zone by the Pearl River Estuary. It operates special policies even more preferential than those in Special Economic Zones， including those relating to customs clearance， tax and land， industry， informatization， and finance.

In July 2011， the State Council issued the Reply of the State Council Concerning Relevant Policies on the Development of Hengqin. It called for Hengqin New Area to become a pilot zone for deepening reform and opening-up and innovations in science and technology， to further maximize the advantages of Hong Kong and Macao as free ports， and to promote innovation in the customs system， science and technology， management systems and development mode， with the aim of enabling Hong Kong and Macao residents to work and live in， and travel to and from Hengqin. Efforts should also be made to raise the level of internationalization of socio-economic development and construct highlevel industrialization bases. Hengqin is expected to make breakthroughs in key sectors of reform and opening-up to provide experience for the development of the Pearl River Delta.

In order to create an internationalized and sound legal environment for businesses， Hengqin has succeeded in many bold and “first” attempts： it took the lead nationwide in launching business registration reforms and promulgating the first business registration management regulation， constructing the longest utility tunnel， launching the first multi-currency UnionPay card， and being nominated one of Chinas first national ocean ecology demonstration zones and first human resources management reform pilot zones. It meanwhile established the mainlands first anti-corruption office to initiate a system for comprehensive prevention and punishment of corruption. Hengqin was also the first to promote the property declaration system for officials， and to explore the land management system through coordinated planning of the national economy and social development， along with overall planning for city development and land utilization.

“Since Hengqin New Area was established， it has clearly boosted the development of Zhuhai，” He Zhiyuan said.“My friends in Macao often consult me about doing business in Zhuhai. I usually invite them here to see for themselves. Zhuhai has become a hot destination for Macao people to start companies.”

By the end of 2013， Hengqin had welcomed 38 enterprises that are global 500 companies， 45 of Chinas top 500 companies and six of the top 100 Hong Kong listed companies. Zhuhai Chime Long Group has invested in the construction of the largest sea resort in Asia， which opened at the end of 2013. A total of 63 key projects， with a total investment exceeding RMB 240 billion， are under construction.

“As the intersection and transitional belt between the mainland and SARs under the ‘one country， two systemspolicy， Hengqin will play a special role by becoming a driving force to develop Zhuhai. Enjoying a distinctive location and boasting innovative preferential policies， Hengqin connects Hong Kong and Macao with the mainland. It will provide a brand new platform and form a new driving force for industrial restructuring， especially for the development of the service industry on the west banks of the Pearl River Estuary，” Niu Jing concluded.