GBA Series by Macau Business (August 2022)

Nansha, a new pathway
By José Carlos Matias, Director of Macau Business

Less than one year after the master plan of the Guangdong-Macau In-depth Cooperation Zone in Hengqin was unveiled, another special area in the Greater Bay Area (GBA) is gaining steam and levelling up the regional integration game. The most southern district of Guangdong’s provincial capital Guangzhou, Nansha is a state-level new area covering an area of 800 square kilometres, 60 of which are part of the Guangdong Free Trade Zone.

On June 6, the State Council published the Nansha Cooperative and Comprehensive Blueprint with Guangdong-Hong Kong-Macau, pointing to new pathways for companies and professionals from both SARs to venture into the GBA.

According to the blueprint, Nansha aims to develop high-end science, technology, and innovation by offering incentives to Macau and Hong Kong firms and talents, such as a 15 percent reduction in enterprise tax and a partial exemption from professional tax.

Interestingly, just ten days after the blueprint was released, Hengqin followed Nansha’s lead and announced that corporate income tax would be reduced to 15 percent, while individual income tax would be limited to 15 percent.

In the “2021-2022 China Pilot Free Trade Zone Institutional Innovation Index”, Nansha ranked 2nd, behind Shenzhen’s Qianhai district, while Hengqin dropped to 11th. The neighbouring In-depth Cooperation Zone needs to catch up and make up for the rather slow recent pace of development, as COVID-19 outbreaks and mobility restrictions prevent the island’s joint development between Guangdong and Macau from gaining steam.

Once the pandemic dust settles, Macau will hopefully look west (Hengqin) but also north (Nansha) to get regional integration right.

GBA Roundup – Five Takeaways

1. Guangdong sees foreign trade up 2.8 pct in H1

Guangdong Province saw its foreign trade grow 2.8 percent year on year to hit 3.91 trillion yuan (about 579.68 billion U.S. dollars) in the first half of 2022, customs authorities said. The province’s exports climbed 7.3 percent to 2.47 trillion yuan, while imports were down 4 percent to 1.44 trillion yuan.

2. Hengqin GDP reaches US$3.3 billion in H1, 391 new Macau-funded firms registered

The regional gross domestic product (GDP) of the Guangdong-Macau In-Depth Cooperation Zone in Hengqin in the first half of the year stood at RMB 22.393 billion (MOP26.8billion/US$3.31billion), showing a year-on-year increase of 2.5 per cent. Official data also indicates that 391 Macau-funded enterprises were newly registered in the Zone, accounting for 19 per cent of the total number of newly registered firms in the first six months.

3. Qianhai and Nansha rank 1st and 2nd in free trade zone innovation ranking

The Qianhai District in Shenzhen and Nansha District in Guangzhou ranked 1st and 2nd respectively in the “2021-2022 China Pilot Free Trade Zone Institutional Innovation Index”, while the ranking of Hengqin dropped to 11th.

4. Zhuhai Port ranked 5th nationwide in 2021 in terms of revenue

State-owned group Zhuhai Port Co., Ltd ranked fifth in mainland China in 2021 in terms of reported revenue among the country’s port enterprises.
In 2021, Zhuhai Port achieved an operating income of over RMB32 billion (MOP38.5 billion/US$4.7 billion), with a cargo throughput of 142 million tonnes.

5. Some 80pct of GBA mainland customers interested cross-border insurance products

About 80 per cent of Greater Bay Area mainland customers have no experience in buying insurance products from Hong Kong or Macau, but expressed a strong interest in learning more about cross-border insurance products, a survey carried out consultancy agency Deloitte shows.