Chief China Economist, Ba Shu Song, Hongkong Exchange: The Mission Of Tai Wan Is To Promote Technological Progress In The Process Of Transformation.

"Talking about the mission of the Great Bay area is how to promote technological progress in the process of transformation. The path is to provide a unique solution to achieve a good interaction between finance and the new economy." During his first keynote speech at the first Forum on innovation and economy in Guangdong, Hongkong and Macau, and the keynote speech, chief economist of Hongkong exchanges, chief economist of China Banking Association and executive director of HSBC Institute of finance, Peking University,

Ba believes that in the promotion of economic transformation, the Great Bay area should make its own contribution, rather than stay in the "building several buildings, real estate GDP investment plus a little more", these contributions to China's economic transformation are very limited, and the importance in China will continue to decline.

At present, the global economic growth is facing great challenges, and the driving force of traditional economic growth is also weakening.

Ba Shu Song - Gan Jun photo

"If we emphasize our mission, that is, whether we can make contributions to China's technological progress and industrial transformation, we can see that China has made positive progress at this point, but there is still much room for it," said Ba Shu song.

Also in early 2018, Hongkong launched the reform of the listing system that stimulated the listing of new economy as the theme. This strengthened the vitality of Hongkong's capital market. The data disclosed by HKEx in October 2019 showed that since the launch of the new listing system in April 30, 2018, as of the end of September this year, 16 biotech companies have been landing on the main board of HK Stock Exchange, raising HK $53 billion 500 million, and continue to be the second largest biotechnology financing center in the world. Among them, 16 biotech companies include 9 biotech companies listed under Chapter 18A of the listing rules, which raise HK $26 billion 800 million.

Ba Shin song also quoted data from China's National Bureau of statistics, saying that even in the period of severe regulation of real estate, investment in real estate development in China was more than 12 trillion yuan in 1-11 months in 2019.

"On the one hand, we realize that there is a huge demand for transformation. On the other hand, financial resources are allocated to traditional industries in an undisputed and absolute proportion," said Ba Shu song. When it comes to the mission of the Great Bay area, if the big bay area does not make its own contribution at this point, it will still invest heavily in real estate and other industries, which has made a very limited contribution to China's economic transformation.

What we need to do now is to speed up the transformation of a resource allocation so as to increase the proportion of the whole new economy.

Ba believes that the financial industry must do something to find a unique solution to speed up the transformation process.

"From the entire technology cycle, it is at the end of the old cycle and the early stage of the introduction of the new technology cycle. This feature is very obvious. The era that we just want to win the competitive advantage by simply imitating is over. We must have our own original and independent R & D capability. Ba Shu Song said.

In the period of economic transformation, financial resources are often invested in heavy assets. The industry of light assets is still hard to get financial resources support.

In the current environment, we need to do more than simply issuing bonds and financing. We must make institutional innovations, not only to familiarise ourselves with international rules, but also to have a deep insight into the unique financing needs of China's industries. And combine international rules and China's unique aspirations, and put forward their own solutions. "If we can put forward such a solution, the market will give very positive feedback, and the Hongkong market is a positive case." Ba Shu Song said.