Front-page stories covering Asia’s economic growth over the last 12 months have been overwhelmingly dominated by three unprecedented developments: China’s on-going Belt and Road Initiative; the greater economic integration of southern China with Hong Kong and Macao under the Greater Bay Area plan; and the growing economic strength of ASEAN following its signing of a Free Trade Agreement with Hong Kong.
Just how the benefits of these developments can be made sustainable and how smart businesses can capitalise on them is the theme of the headline session at the 8th edition of the Asian Logistics and Maritime Conference (ALMC), on 20-21 November 2018.
“Boosting Asian Connectivity for a New Regional Economic Order” will examine connectivity and integration, the buzzwords of the 21st century, in all their manifestations.
Spearheading the growth in connectivity and the depth of integration is of course the Belt and Road Initiative. What was a concept as recently as 2013 is rapidly becoming a near global economic game changer led by China.
In order to facilitate trade and boost it exponentially over time China has recognised the need for huge investment in connecting infrastructure. It is estimated that China’s investment in Belt and Road countries could top US$300bn by 2030 with strategic infrastructure projects yielding enormous economic returns and development benefits over the medium to long term.
Already China has signed up to 101 agreements with 86 countries and invested US$50bn in 24 countries along the Belt and Road economies. These investments are said to have originated 75 industrial and trade zones and 200,000 jobs. The most prominent of the investments is either in upgrading the routes as in rail projects that collectively link China to London or in the all-important ports as vital sources of distribution.
The Belt and Road Initiative is not a game of solitaire. According to Standard Chartered Bank, as of mid-2017: “Interest in funding B&R initiatives is coming from a wide variety of parties, not just financial institutions such as the World Bank, but also multilateral development financial institutions such as the Asian Infrastructure Investment Bank; investment cooperation funds such as the Silk Road Fund; China’s policy banks; commercial banks, both Chinese and foreign; and China’s export insurance company. The AIIB alone has provided US$2.8bn for 18 Belt and Road projects, and the Silk Road Fund has completed contracts for 15 projects.”
In the face of the vast Belt and Road Initiative, China’s Greater Bay Area (GBA) plan may appear modest but the 11 cities embraced by the GBA concept nearly all have a track record in contributing to China’s powerhouse economy. Total GDP amounts to US$1.4trn, or 12% of the national economy despite having a population of just 68m or 5% of the country’s total. Just what Hong Kong will bring to the table is still a matter of debate. Some have suggested that Hong Kong could be a leader in innovation and technology, others suggest that the territory’s established forte is in the areas of finance and law – there has been a strong push for the territory to boost its expertise in dispute resolution – and it is already the case that many mainland companies have gained a presence in Hong Kong in order to access finance both for their domestic projects and for B&R development.
Even before Hong Kong signed up to a free trade agreement with the countries within ASEAN in November 2017, total merchandise trade between Hong Kong and ASEAN amounted to HK$937bn that year. Total Services trade between the two sides was HK$119bn in 2016. Closer regional ties forged through agreements such as the free trade agreement will further strengthen trade and investment flows while enhancing Hong Kong’s role as a trading and logistics hub. As with its position along the Belt and Road, Hong Kong can further develop its role as the super-connector.
Despite these great advances the oldest form of connecting –meeting face to face – is still what we are most comfortable with and invariably forms the first step in the deal and trade flows that ensue, whether they be physical, financial or virtual. Nowhere will this be more apparent than at ALMC 2018 at the Hong Kong Convention and Exhibition Centre this November.
ALMC 2017 welcomed 2,100 participants from 36 countries and regions to witness the insights and strategies of the world’s best business leaders. ALMC 2017 also played host to more than 120 exhibitors.
There were over 190 one-on-one business matching meetings and thousands more connected throughout the networking sessions.
If you are looking to connect with the world changing developments in Asia strike while the iron’s hot and sign up to ALMC 2018 and benefit from early bird rates at this link: www.almc.hk
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