What employers need to know about the Guangdong-Hong Kong-Macau (GBA) Greater Bay Area
An introduction to the nine municipalities of the Mainland GBA, as well as the Hong Kong and Macau SARs (the 9+2 cities) and four major development areas of the Mainland GBA (the 4 areas) – in short, here is your ‘ 9+2+ 4’ guide.
If you’re aiming to expand your presence in North Asia, or you’re a business operating in Hong Kong, you’ll probably want to learn more about the Greater Bay Area (GBA) and the industries it supports. .
The GBA is made up of the two Special Administrative Regions (SARs) of Hong Kong and Macau, and the nine municipalities of:
- Jiangmen, and
- Zhaoqing in Guangdong Province.
The total area is about 56,000 km, the total population is over 86 million, and the GDP in 2021 was $1.9 billion, which exceeds that of South Korea, Spain, and China. Australia.
Invest Hong Kong (InvestHK) and PwC recently jointly launched an investment guide to help foreign companies set up or relocate to the Guangdong-Hong Kong-Macau (GBA) Greater Bay Area via Hong Kong . We have extracted from this guide some of the essential things that employers and policy makers need to know.
Fast facts on the nine municipalities and two RAS (9+2) in the GRB:
- Canton: Guangzhou, as one of the country’s international consumer hubs, is a distribution center for consumer goods such as cosmetics, coffee and tea, and fresh flowers.
- Shenzhen: Shenzhen is recognized as a city of innovation, playing a leading role in electronics, internet and information technology, life sciences and new energy sectors.
- Zhuhai: The six main industries are IT, household appliances, electricity and energy, biopharmaceuticals and medical devices, petrochemicals and precision machinery; while printing supplies and yacht manufacturing are the other two special industries.
- Foshan: In 2021, the 14e Guangdong’s Five-Year Manufacturing Industry Plan has tasked Foshan with developing key traditional and emerging manufacturing industries (such as precision instruments, integrated circuits, semiconductors, etc.) as well as helping to promote the west of the Pearl River Delta.
- Huizhou: Huizhou’s modern industrial system consists of IT and petrochemicals (the pillar industries), as well as automobile and equipment manufacturing and clean energy industry.
- Dongguan: Dongguan is famous for its manufacturing industry. Its pillar industries are IT, machinery and electrical equipment; shoes and accessories; food and beverage processing.
- Zhong Shan: Zhongshan has a plan to boost innovation and development, build Zhongshan Science and Technology Innovation Park, Photon Science Center and Advanced Low-temperature Technology Research Institute, etc.
- Jiangmen: Jiangmen is a strong agricultural city in Guangdong Province.
- Zhaoqing: Zhaoqing focuses on culture, tourism, sports and other areas to take advantage of economic growth, with new hot spots in consumer sectors for future development.
- Macau SAR: As a free port and independent tariff zone, Macao has an extensive international marketing network with close ties to Portuguese-speaking countries, offering an attractive corporate tax rate of no more than 12%.
- Hong Kong SAR: Hong Kong adopts a low, simple and competitive tax system. Only three direct taxes are imposed: income tax (16.5% / 8.25%), wage tax (15%) and property tax (15%).
Quick facts about the GBA’s four important areas for cooperation with Hong Kong and Macao:
Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone (located in Shenzhen Municipality)
- Companies established in Qianhai and engaged in encouraged service industries can benefit from a preferential tax regime (i.e. a corporate tax rate reduced from the statutory rate of 25% to 15%): it covers 30 sectors of technology services, modern logistics, cultural innovation, information services and business services.
- Tax professionals registered in Hong Kong and Macao (in certain sectors) authorized to work in Qianhai.
- Qianhai International Talent Center.
- Talent grants and aids.
- Qianhai Shenzhen-Hong Kong Youth Innovation and Entrepreneurship Center.
Guangdong-Macao Deep Cooperation Zone in Hengqin (located in Zhuhai Municipality)
- Companies established in Henqgin and engaged in encouraged services can benefit from a preferential tax regime (ie a corporate tax rate reduced from the statutory rate of 25% to 15%).
- The zone offers free trade port treatment; reduced personal income tax rate (reduced from the top rate of 45% to effectively 15%) for skilled talent; and tax exemption on dividends from overseas investments made by companies established in China and operating in designated industries.
- Four major industries: (1) Scientific and technological research and high-end manufacturing (2) traditional Chinese medicine; (3) cultural tourism, congress and exhibition; commercial and commercial industries; and (4) financial services.
- Macau residents who live and work in Hengqin, aligning with public services and the social security system.
- Make breakthroughs in development in relation to technologies, talents and flows of capital and information.
Shenzhen-Hong Kong Innovation and Technology Cooperation Zone (located in the municipalities of Hong Kong and Shenzhen)
- A new joint agreement on establishing a One Zone, Two Parks system within the Shenzhen-Hong Kong Innovation and Technology Cooperation Zone has been reached between the governments of Hong Kong SAR and Shenzhen in September 2021. The area includes Hong Kong-Shenzhen Innovation and Technology Park (HSITP) and Shenzhen Innovation and Technology Zone (SZ I&T Zone).
- This initiative indicates clear support for the development of Hong Kong into an international I&T hub and deepening cooperation between Hong Kong and the mainland in the field of I&T.
- Focus on removing institutional barriers to openness, innovation and cooperation.
- Build cross-border cooperation platforms.
- Establishment of InnoLife HealthtechHub focused on R&D in health and life disciplines.
Nansha Guangdong-Hong Kong-Macao Comprehensive Cooperation Demonstration Zone (located in Guangzhou Municipality)
- Nansha is the hub connecting the clusters of towns on the banks of the Pearl River estuary. Its seven functional areas are committed to the economic and technological development of Nansha District and Guangzhou, and the construction of an integrated service hub based on Guangdong-Hong Kong cooperation.
- Key industries to be developed for this commitment include maritime logistics, international finance, international trade, science and technology innovation, maritime economy and high-end manufacturing industries.
- It is committed to establishing an internationalized business environment suited to international rules and to giving priority to the liberalization of trade in services with Hong Kong and Macao.
- Nansha is expected to become an international maritime logistics center with international trade functions and integrated financial services, forming a basis for science and technology cooperation with countries and regions along the 21stMaritime Silk Road of the last century.
When launching the Guide, Managing Director of Investment Promotion at InvestHK, Stephen Phillipssaid, “Hong Kong is well positioned to play a pivotal role as a single gateway for international businesses to access the GBA and the wider mainland market. The scale and scope of opportunities are too important for companies around the world to ignore and Hong Kong is a fantastic entry point for the GBA.”
Charles Lee, PwC Tax Manager for South China and Hong Kongadded, “We advise companies to have a ‘GBA mindset’ to strategically cluster and nurture talent from across the region to improve productivity and creativity; develop GBA strategies to exploit new market potential; leverage location advantages in the GBA to create a strong channel offering; and using institutional policies to accelerate market access”.
Lead image / Guide launched by InvestHK and PwC
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