In a significant development for Hong Kong's economy, the Closer Economic Partnership Agreement (CEPA) between Hong Kong and mainland China has been expanded to include seven new sectors: tourism, television, film, banking, securities, insurance, telecommunications, and construction. Financial Secretary Paul Chan Mo-po signed the amendment on October 9, 2024, which is set to take effect on March 1, 2025. This expansion aims to ease qualification requirements for Hong Kong professionals and reduce market access thresholds, thereby allowing more local companies to enter the mainland market [e8595a34].
This move comes at a time when Hong Kong is also looking to strengthen its economic ties with ASEAN, as Chief Executive John Lee Ka-chiu has emphasized the importance of diversifying trade relationships amidst increasing tariffs imposed by the United States and the European Union on Chinese goods [10e3534b]. The CEPA was originally signed in 2003 to aid Hong Kong's economy in the aftermath of SARS, with the last amendment made in November 2019 covering 153 service sectors [e8595a34].
In conjunction with the CEPA expansion, Hong Kong is planning to open its fourth Economic and Trade Office in Kuala Lumpur, Malaysia, in October 2024, further solidifying its commitment to enhancing economic collaboration within the ASEAN framework [10e3534b]. Trade between Hong Kong and ASEAN reached US$145 billion in 2023, underscoring the growing significance of ASEAN as a trading partner for Hong Kong [346e1dbc].
Moreover, the integration of Hong Kong into the Regional Comprehensive Economic Partnership (RCEP) could potentially eliminate up to 90% of tariffs on imports between signatories within 20 years, enhancing trade flows and economic collaboration [346e1dbc]. As regional dynamics evolve, the focus on digital and green technology in the upgraded ASEAN-China trade deal reflects a broader trend towards regionalization, positioning both regions to mitigate the impacts of Western tariffs [005296dd].
Li Yongjie from the Ministry of Commerce emphasized the importance of supporting Hong Kong under the 'one country, two systems' principle, indicating a commitment to fostering economic growth and stability in the region [e8595a34]. As Hong Kong navigates these complexities, the intersection of politics and technology will play a crucial role in shaping its economic policies, ensuring sustainable development and resilience against external shocks [af788731].