The GBA gets a major boost at the end of this month, when the north-south Intercity Railway opens between Shenzhen, Dongguan and Guangzhou, as we reported recently. But in five years’ time, the much bigger infrastructure project of the main east-west high-speed railway connection will open. This has been confirmed by provincial authorities. The Shenzhen-Jiangmen section of the Shenmao Railway has been given the official green light to begin construction by the end of the year, with completion set for late 2024.
It cannot be emphasized enough how this railway connection will change the economic structure of the GBA. Running from Shenzhen’s under-construction Xili Station, one of the city’s four major railway hubs, it will run across (and under) the mouth of the Pearl River, linking the manufacturing powerhouses of Shenzhen and Dongguan on the east with Nansha (in the middle) and Zhongshan and Jiangmen in the west.
The Shenzhen-Nansha section will chug along at a sedate 200km/h, while the Nansha-Jiangmen section will allow speeds of up to 250km/h. There will only be seven main stations along the route, which means express trains can get across the Bay more quickly at certain times of the day.
The line will essentially make Zhongshan and Jiangmen outer neighborhoods of Shenzhen. And it will boost Nansha, being right in the middle, as a central hub as it strives to build a new center of gravity for the entire Bay (more on this tomorrow in our Nansha overview).
Read more (in Chinese).
Hong Kong remains China’s key gateway for foreign investment despite the protests, according to the latest data from Beijing. As SCMP reports, China received US$62.9 billion in foreign direct investment via Hong Kong in the first eight months of this year, accounting for 70 per cent of total inflows. The rise was even sharper once the monthly number for August was calculated: US$7.53 billion, up 29.2% from the same month last year.
It’s hard to blame or credit these flows on anything Hong Kong is doing, as Investment decisions into China are often months, if not years, in the planning. Still, the numbers might bring some comfort at a time when the tourism pillar of the economy is crumbling.
According to this SCMP report, Causeway Bay is struggling, with one in ten shops standing empty and thousands of staff facing job losses. We think a very painful withdrawal experience lies ahead as the city is forced off the drug that it has been hooked on since 2003. Mainland tourists have other options, including Macau, and once mainland tariffs on imported goods start being completely repealed, they will likely have little reason to come back – even if the protests somehow start to subside.
Across the city, the hotel industry is reeling. But landlords appear to be doing what they do best: forcing management companies to let go of staff while they figure out the best way to reconvert the buildings into office space. And they are in the meantime looking to move their real-estate projects as fast as possible before prices start to fall off a cliff as the government strong-arms them into offering below-market discounts.
Hong Kong needs a big, new vision for its future.
Data from Guangdong’s two major airports indicates that their air traffic continued to grow in August, while protests targeting the Hong Kong International Airport had a material impact on its traffic overall – not only that of its biggest carrier, Cathay Pacific. While overall traffic through HKIA dropped 12.4% YoY in August, the worst in more than 10 years, Shenzhen Baoan and Guangzhou Baiyun both saw their traffic rise by almost the same amount.
The three airports are more than 100 km apart and are not yet connected by high-speed railway, so it is not that easy for passengers stranded at one (for whatever reason) to switch to another one. Nevertheless, it seems that the two domestic airports, which do not have nearly as many international flights as HKIA does, appeared to make gains at the same time that Hong Kong was being disrupted.
Continue reading Guangzhou, Shenzhen keep air traffic rising as Hong Kong drops
After a weekend of chaotic scenes in Hong Kong, including fistfights between rival camps in the streets, Hong Kong’s outgoing monetary chief, Norman Chan, tried to present a picture of fortitude and calm to investors today.
As SCMP reports Chan saying: “The financial market in Hong Kong is much bigger nowadays than at the time during the Asia financial crisis in 1998. The short sellers who want to attack the local currency would find they would need much more bullets to carry out the attacks, which would be too expensive for them to so. As such, the public does not need to worry about the short sellers’ attack to the peg as they would not be able to repeat what the short sellers were doing during the Asian financial crisis.”
He does have a decent argument. The Exchange Fund stands at HK$4.138 trillion (US$528.73 billion), 4.5 times more than the level at the end of 1998, when it was last attacked by speculators in the wake of the Asian Financial Crisis. He also says there is no evidence of a major movement of capital out of Hong Kong.
However, one has to wonder why Chan is bothering to comment at all, if the government’s ammunition is so extensive that the public need not worry about it. While Chan says there have not been significant short positions taken against the HK dollar recently, is he seeing something he doesn’t like in the way local depositors are switching into US dollars? We will just have to wait and see.
Not usually one to play catch-up to Shanghai, Guangdong has announced it is getting its own Science and Technology Innovation Board, otherwise known as a STAR Market.
Shanghai launched the first STAR Market on July 22. Its first day of trading made national headlines as share prices soared, but they came down in the subsequent days as traders locked in early profits.
Now, it has been decided that Guangdong is following suit, under guidelines released by the central government earlier this year aimed at boosting innovation by making it easier for small and micro enterprises to raise equity on regional exchanges.
Continue reading Guangdong to launch its own STAR Market
Ho Iat Seng, Macau’s new Chief Executive-designate, has made his first remarks on the issue of the gaming concessions, telling reporters that he is keen to resolve their “historical problems”.
Speaking to the media after getting a warm pat on the back by President Xi Jinping, who appointed him the third CE of Macau since the 1999 handover, Ho said he was keen to see the law take the lead in dealing with the imminent expiry and retendering process of the concessions, rather than using executive orders.
Continue reading New Macau chief sees ‘historical problems’ with casinos
Parents of high-schoolers across the Greater Bay Area are probably interested in the Times Higher Education World University Rankings, which were released yesterday. The usual contenders were up there, with China led by the two Beijing elite schools, Tsinghua and Peking (23rd and 24th), while the Greater Bay Area was led by Hong Kong’s top trio of HKU (36th), HKUST (41st), and CUHK (53rd).
Guangdong was led, as usual, by Sun Yat Sen University, whose main campus is in Guangzhou. It was eighth in the mainland yet only in the 251-300 rankings globally.
Officials in Shenzhen will probably be pleased to see that two of the city’s universities climbed up into the 20 best on the mainland: Southern University of Science and Technology (9th), and Shenzhen University (18th).
They might not care that the University of Cambridge slipped a notch, overtaken by the California Institute of Technology. Third place overall is good enough to put Shenzhen on the world map for higher education, assuming the prestigious UK university does decide to set up a joint venture in Shenzhen with Tsinghua, as we reported last week.
Read the full rankings here.
The western side of the Greater Bay Area still struggles with connectivity issues, and speedier progress is needed in linking it to the eastern side. So says the CPPCC of Zhuhai.
Fortunately, there is a plan on the drawing board that could alleviate this challenge, according to Pan Ming, deputy chairman of the city’s CPPCC, quoted by the Zhuhai Daily. It is the proposed Crossbay Railway, otherwise known as the Shenzhen-Nanning High-Speed Railway (Shennan). This incredible project, which would be built entirely under the seabed across the Pearl River Delta, has its engineering challenges, but Pan believes it has been researched thoroughly and provides the best available solution.
Continue reading Zhuhai wants Crossbay Railway, ASAP
Stung by recent poor appraisals of its education system, Shenzhen’s city government has unveiled ambitious short-term targets for investment into and and upgrading of the city’s schools. “Suggestions for Improving Educational Quality” were unveiled yesterday by local media.
As Nanfang Daily reports, all three levels of basic education are being targeted. For preschools education, more public kindergartens will be built immediately, with the target set for a 50% weighting among the city’s total number of kindergartens by next year. Primary and secondary schools, meanwhile, will see enrolment jump by 25% in time for the 2020 academic year.
High schools and universities, however, are getting the most attention, as that is where the shortages are most severe. Only 47% of middle school leavers were able to enter high school in the city last year, and that dropped to 45% this year. By next year, Shenzhen will have established more than 30 new public high schools, providing an additional 60,000 places for students.
More detailed plans are under way for the establishment of “high-standard” universities at a world-class level, the city says, which will involve :enhancing cooperation between universities in Shenzhen and abroad”.
Shenzhen has become
the first city in China to use a 5G network in its healthcare system, switching
on the new network this week in the Shenzhen People’s Hospital.
Quoted by the Shenzhen Daily, Qiu Chen, the hospital’s
chief, said he was mightily pleased by the demonstration, as he was taken on a
“video ward rounds” exercise.
Continue reading Shenzhen turns on 5g in hospital