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The Greater Bay Area

A view from Victoria Peak, Hong Kong, Special Administrative Region of the People's Republic of China. Snapshot from November 2019, taken by Lucilla De Stefano

China’s Guangdong - Hong Kong - Macao Greater Bay Area (GBA), 粤港澳大湾区 Yuègǎngào dàwānqū, is a grandiose and ambitious scheme aiming at integrating the Pearl River Delta (PRD), securing its status as a major trading hub and cementing its role as one of the starting points of Xi’s ​​Belt and Road Initiative (BRI).

Although the term GBA was only coined during the drafting of China’s 13th Five-Year Plan (revealed in December 2016), the PRD had already played a significant role in China’s history. However, the sheer scale of this enterprise clearly sets the GBA apart from its predecessors. Indeed, as one of China’s richest areas, this venture is both paramount to the sustainability of China’s economic growth, and a pilot scheme for the “moderately prosperous country” China ambitions to become by 2049.

A Project of Ozymandian Dimensions

The GBA is composed of 9 municipalities (Guangzhou, Shenzhen, Zhuhai, Foshan, Huizhou, Dongguan, Zhongshan, Jiangmen, and Zhaoqing) and 2 special administrative regions (SARs, Hong Kong, and Macao), hereinafter the “9+2”.

Together, these cities are home to just over 72 million people, equivalent to the entire population of France, or 5% of China’s total population, living in an area of 56,094 square kilometres accounting for less than 1% of China’s land area. With a combined GDP just shy of 1.7 trillion USD, the GBA accounts for 12% of the country’s GDP, and stands at twice the national average GDP per capita (although this figure hides massive disparities).

A Short History of the GBA

At a 2021 French Chamber in Hong Kong GBA event, Laurence Li SC, Chairman of Temple Chambers, argued that the GBA was bound to succeed as it was riding “the wave of history”.

The Pearl River Delta has since the late Ming dynasty been China’s main commercial hub. The Portuguese established themselves in the colony of Macao by 1557, which served as a base for commerce between European and Chinese merchants. Under the Canton System (1757/1760 - 1842), Guangzhou was the sole Chinese city open to trade with the West. The Cohong (a guild of Chinese merchants) were granted a monopoly over imports and exports, and managed the Thirteen Factories, whilst Europeans commerced there in the summer and winter in Macao (until 1806 when this mandate was lifted by emperor Qianlong).

After the Opium Wars, British merchants made several short-lived attempts at building the “Kowloon-Canton railway”, before construction finally began in 1904. Rough terrain and poor planning led to soaring costs (the railway was one of the most expensive in the world at the time, ballooning to HK$12 296 929). Nonetheless, the first step towards regional integration had been taken.

During Mao’s reign, a bamboo curtain descended over the PRD before Deng Xiaoping’s reforms revitalised the region (from the early 1980’s onward). As part of Ni’s and Coase’s (2013) “four marginal revolutions”, Shenzhen and Zhuhai were set up as Special Economic Zones in 1980. This led to the development of the famous “front-shop, back-factory” model, under which Hong Kong and the whole region prospered through regional specialisation. The low-cost Guangdong municipalities developed their manufacturing capabilities, whilst the European colonies transitioned away from the secondary towards the tertiary sector. “Having secured abundant inflows of capital, technology, talents, and experience in international management from the colonies, Guangdong soon grew into a leading global manufacturing hub, whereas Hong Kong and Macao further developed their professional services and tourism-leisure sectors.” (Li and Kwok, 2019). Already, Guangdong was a pilot zone, spearheading China’s reforming and opening-up policies.

After the colonies were handed over, numerous frameworks of cooperation between the newly formed SARs and the Guangdong hinterland were crafted. A “Closer Economic Partnership Arrangements” (CEPA) was signed in 2003, whilst the National Development and Reform Commission first mentioned the “bay area action plan [to] facilitate cooperation with Hong Kong and Macao” (National Development and Reform Commission, 2008), before the “Framework Agreement on Hong Kong/Guangdong Cooperation” was unveiled in April 2010. This last step triggered heavy debate about its potential conflict with the founding rule of “one country, two systems”.

Outlined Plans

Since its establishment, the GBA is expected to act as a gateway between China and the rest of the world. Most importantly, the GBA is also envisioned to play a key role in China’s BRI, as the starting point of the Maritime Silk Road.

Its main goal, however, remains to regionally integrate the PRD and transform the latter into a regional hub based on development of all kinds. For these reasons, the GBA incorporates twelve points in its key policy areas. Among others, the continuation of the enhancement of the innovation and technology field; the implementation of efficient financial services; the betterment of infrastructure connectivity and logistics; the safeguarding of a correct observance of CEPA between Hong Kong and the Mainland, and the possibility for Hong Kong professional services (e.g. architects, structural engineers, lawyers, doctors) to acquire the corresponding Mainland's professional qualifications through mutual recognition or examinations; the implementation of functional international legal and dispute resolution services; the easing of clearance facilitation; the amelioration of the medical and education services, the improvement of youth development; the sponsorship of arts and culture, creative industries, and intellectual property; the fostering of tourism; and, lastly, the compliance with environmental protection and sustainable development (Bay Area, 2022). These fields touch the 9+2 comprehensively, although delineating development imbalances due to their different states of progress.

Moreover, the total adherence to the “one country, two systems” founding principle plays a crucial factor in the smooth deployment of the project. This rule drives the country’s willingness to reaffirm the central government’s authority (“one country”) while also pledging to respect and leverage the SARs’ differences (“two systems”). In this regard, under the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, the GBA is expected to use the advantages of Hong Kong and Macao as free and open economies, and of Guangdong as the pioneer of reform and “opening up”.

In fact, while integrating the nine Mainland cities presents relatively minor difficulties, successfully integrating Hong Kong and Macao into the mix is a whole different story. The former European colonies have their own official languages as well as their own political, legal, monetary, and financial systems. Successfully bringing together these different environments into a coherent system might seem discouraging, though not impossible, but it would take decades to accomplish (Ballesteros, 2022).

Under the regional integration plan, four core cities have been identified as “engines” of development. They are the two SARs, Guangzhou, and Shenzhen. On the one hand, they foster regional develo