First Anniversary of the Qianhai Plan, Shenzhen-Hong Kong Collaboration Has Much Deepened

SHENZHEN QIANHAI – Media OutReach – 7 September 2022 – September 6, 2022 marks the first anniversary of the promulgation and implementation of “the Plan for Comprehensive Deepening of the Reform and Opening Up of the Qianhai Shenzhen-Hong Kong Modern Service Industry Co-operation Zone” (“Qianhai Plan”) issued by the State Council. With emphasis on “expansion” and “reform and opening up”, Qianhai has carried out a number of key tasks in Shenzhen-Hong Kong collaboration, international cooperation, opening up of the financial industry, opening up of legal affairs, technological innovation, business environment, clustering of talents, etc. Achievements are apparent. In 2021, the GDP of Qianhai District was 175.567 billion yuan, with an annual increase of 10.5%. The actual use of foreign capital was US$ 5.822 billion, with a yearly increase of 14.9%. Total customs area import and export goods was 1.74 trillion yuan accounting for an increase of 20.3%. From January to June 2022, the actual use of foreign capital was US$3.533 billion, representing a rise of 17.4%.

1. Deepening reform

The Qianhai Cooperation Zone has launched 725 institutional innovations in investment, trade, finance, and rule of law, among which 65 were replicated for national-wide use. The National Development and Reform Commission approved Qianhai’s national first standards such as “Format Specifications for Enterprise Credit Reports Based on Cross-border Activities” and “Electronic Warehouse Receipts for Bulk Cargo”. Furthermore, Qianhai’s preferential corporate income tax policy has been expanded to five categories with 30 items.

2. Deepen Shenzhen-Hong Kong collaboration

Qianhai Authority announced nine Hong Kong-related facilitation measures on June 30, 2022. On September 2, 2022, the Shenzhen Qianhai Authority and the Financial Services & the Treasury Bureau of the Hong Kong SAR Government jointly promulgated 18 measures for Supporting the Linked Development of Shenzhen and Hong Kong Venture Capital Investments in Qianhai. The measures will provide facilitation and preferential policies for the Hong Kong private equity industry and promote the development of a mechanism that links the Shenzhen and Hong Kong Venture Capital industry. The 18 measures complement the three-step strategy implemented by Hong Kong for developing the private equity fund market, i.e. 1) introducing the limited partnership fund (LPF) regime; 2) offering tax concessions for carried interest distributed by eligible private equity funds; and 3) establishing a mechanism to attract foreign funds to re-domicile in Hong Kong, thereby providing clear support for the convergence of rules between Hong Kong LPFs and Qianhai Qualified Foreign Limited Partnerships (QFLPs). On the other hand, the practical filing scope of Hong Kong and Macao professionals was expanded to 16 professions, such as tax accountants and tour guides. In order to improve the efficiency of cross-border cargo transportation between Shenzhen and Hong Kong, Qianhai will provide a “water transport connection and diversion” mode.

3. International Cooperation

To actively build up overseas industrial parks, more than 200 Qianhai companies have their presence in the Djibouti International Free Trade Zone and Sri Lanka’s Hambantota Port Industrial Park. Furthermore, Qianhai is committed to strengthening its aviation and shipping hub. Shenzhen Airport has 57 cargo destinations, and the international cargo and mail throughput reached 540,000 tons in 2021. Besides, international organizations such as the ICC International Court of Arbitration and the Singapore International Mediation Centre have now established a presence in Qianhai.

4. Opening up

Peking University and the University of Cambridge jointly initiated Qianhai Sino-British Research Institute, and King’s School, Canterbury will have new Hong Kong children’s classes. Furthermore, Qianhai launched a business notification and commitment system of “Approval for Engaged in Seafarer Assignment Business”. Dachan Bay Port was approved to be incorporated into the Shenzhen National Oceanic Fishery Base with the position of a tuna trading centre. In addition, the first 5G smart port in the Greater Bay Area, Mawan Smart Port, is in operation. In 2021, the container throughput of Qianhai was 14.607 million TEUs, with an annual increase of 10.7%.

5. Open up of the financial industry

Qianhai has “three first batches” of financial innovations. They are: the first batch of pilot bank accounts integrating local and foreign currencies, the first batch of pilot projects for the integrated domestic and foreign currency pool business of multinational companies, and the ” Cross-boundary Wealth Management Connect” in the Guangdong-Hong Kong-Macao Greater Bay Area. In Qianhai Shenzhen-Hong Kong International Financial City, 200 financial institutions have signed up to settle in, of which 30% are Hong Kong-funded or foreign-funded institutions. The Qianhai Mercantile Exchange (QME) launched a new soybean variety, and the cross-border transactions are priced and settled in RMB.

6. Open up in legal affairs

The Supreme People’s Court issued opinions on supporting and safeguarding Qianhai’s reform and opening up, applying extraterritorial laws and cross-border judicial assistance arrangements. Qianhai Shenzhen-Hong Kong International Legal-services District has introduced 122 legal institutions, including China (Shenzhen) Intellectual Property Protection Center. The foreign-related or Hong Kong, Macao and Taiwan-related commercial cases and cases under the application of Hong Kong law handled by the 32 Hong Kong jurors and 16 Hong Kong, Macao, Taiwan and foreign mediators appointed by the Qianhai Court ranked first in the country’s basic people’s courts. The Guangdong-Hong Kong-Macao Greater Bay Area International Arbitration Center has been established.

7. Technological innovation

In August 2022, Qianhai issued measures to promote the reform and innovation of Qianhai’s technology development system and mechanism. The “Technology China” Greater Bay Area Consortium was established in Qianhai. Projects such as the Qianhai Copyright Public Service Platform and Copyright Blockchain Network were selected as pilot projects for innovative blockchain applications by the Cyberspace Administration of China. The National (Shenzhen Qianhai) New Internet Exchange Center is under trial-running.

8. The business environment ranks top tier in the world

The Qianhai e-Services Hong Kong-Macao Station provides 223 services such as “Easy Registration”, “Easy Taxation” and “Social Security Link”. The first Shenzhen Qianhai business license printing machine has been in service since early September. The e-Station provides further convenience to Hong Kong companies and individuals to tackle government-related stuff without leaving the Hong Kong border. Qianhai’s business environment has been further improved, and approval time has been shortened from 49 days to 13 days.

9. Clustering of Talents

Qianhai International Talent Hub provides 100 tailor-made services for international technology talents. It partnered with well-known organizations, such as Boston Consulting Group and Ernst & Young and provided different training courses for senior executives. The services have covered more than 2,500 organizations and more than 520,000 talents. Qianhai International Talent Hub and Hays jointly published the “2022 Greater China Salary Guide Technology Industry Supplement” report.

Professor Witman Hung, Principal Liaison Officer of the Shenzhen Qianhai Authority said that he and his team have conducted about 100 seminars for the Qianhai plan. From the feedback of the audience, Qianhai Plan is welcome by different sectors in Hong Kong.

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