Chinese state firms win billions as Hong Kong splurges on cross-border development

[ad_1] Chinese language state-owned enterprises are profitable billions of {dollars}’ price of contracts for work on large China-linked improvement zones financed by the Hong Kong authorities, an investigation by RFA Cantonese has discovered.

The revelations come as the town authorities forecasts a price range deficit approaching HK$100 billion (US$12.9 billion) within the wake of public spending on COVID-19 measures.

A survey of the Hong Kong authorities’s tender web site by RFA Cantonese confirmed that not less than 14, or 30%, of the 45 contracts linked to the Northern Metropolis city enlargement venture and Hetao Shenzhen-Hong Kong Science and Expertise Innovation Co-operation Zone went to state-owned Chinese language enterprises, together with China Building, China Railway Building, China Geo-Engineering Group and China Street and Bridge Engineering.

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And whereas they solely secured 30% of the contracts by quantity, Chinese language-backed bids gained the lion’s share of the cash, profitable bids price practically HK$79 billion (US$10.1), or round 80% of the worth of all contracts awarded on the 2 improvement zones.

Bulging deficit The revelations come amid rising concern over the deficit forward of the federal government’s price range on Feb. 26.

Making an allowance for proceeds from the issuance of presidency bonds, the newest projected consolidated deficit for 2024-25 shall be “underneath HK$100 billion,” Secretary for Monetary Providers and the Treasury Christopher Hui informed the town’s Legislative Council on Jan. 22.

Hong Kong’s fiscal reserves stood at HK$591.4 billion in November 2024, a pointy fall from HK$1,160.3 billion on March 31, 2020.

<img data-chromatic="ignore" alt="Hong Kong Chief Executive John Lee at the Legislative Council in Hong Kong, Jan. 25, 2024." class="c-image" loading="lazy" src="https://www.rfa.org/resizer/v2/XCW256UUNRAA5N63UYEB65H2OA.jpg?auth=f1b7713a2b6a44bee3f218783fca37cd5e87c4a532155455d603170202c5b964&width=800&height=533" srcset="https://www.rfa.org/resizer/v2/XCW256UUNRAA5N63UYEB65H2OA.jpg?auth=f1b7713a2b6a44bee3f218783fca37cd5e87c4a532155455d603170202c5b964&width=274&height=182 274w, https://www.rfa.org/resizer/v2/XCW256UUNRAA5N63UYEB65H2OA.jpg?auth=f1b7713a2b6a44bee3f218783fca37cd5e87c4a532155455d603170202c5b964&width=400&height=266 400w, https://www.rfa.org/resizer/v2/XCW256UUNRAA5N63UYEB65H2OA.jpg?auth=f1b7713a2b6a44bee3f218783fca37cd5e87c4a532155455d603170202c5b964&width=768&height=511 768w, https://www.rfa.org/resizer/v2/XCW256UUNRAA5N63UYEB65H2OA.jpg?auth=f1b7713a2b6a44bee3f218783fca37cd5e87c4a532155455d603170202c5b964&width=1024&height=682 1024w, https://www.rfa.org/resizer/v2/XCW256UUNRAA5N63UYEB65H2OA.jpg?auth=f1b7713a2b6a44bee3f218783fca37cd5e87c4a532155455d603170202c5b964&width=1440&height=959 1440w" width="800" height="533"/> china-hong-kong-state-companies-northern-metropolis-hetao-02 Hong Kong Chief Govt John Lee on the Legislative Council in Hong Kong, Jan. 25, 2024. (Lam Yik/Reuters) However there are indicators that Beijing is eager for presidency spending to proceed.

Beijing’s high official answerable for Hong Kong affairs, Xia Baolong, made a go to to Hetao Shenzhen-Hong Kong Science and Expertise Innovation Co-operation Zone final week, simply forward of the price range.

He gave Monetary Secretary and Performing Chief Govt Paul Chan “very clear directions” on precisely how Beijing expects Hong Kong to contribute to nationwide financial progress, Chan informed reporters on Feb. 11, after accompanying Xia on his tour.

The directions had been “a fantastic assist in figuring out tips on how to make full use of the Northern Metropolis and Hetao cooperation zone going ahead,” Chan stated.

‘A brand new engine for future improvement’ In the meantime, Chief Govt John Lee informed a Lunar New Yr reception for Chinese language corporations on Feb. 14 hosted by Make investments Hong Kong that his authorities would “drive improvement of the Larger Bay Space and Northern Metropolis to attain financial progress.”

The federal government says the Northern Metropolis is “a brand new engine for the longer term improvement of Hong Kong [that] will inject new financial impetus into Hong Kong” by increasing future housing land provide.

The realm, which the federal government hopes will change into a metropolis of round 2.5 million folks, can be destined for integration into China’s plan for a Larger Bay Space of interconnected cities across the Pearl River delta area.

“The Northern Metropolis is near Shenzhen’s metropolitan core and the bottom of I&T business with the best improvement momentum, and having seven land-based boundary management factors, forging a necessary platform for our cooperation with different Larger Bay Space cities,” in response to its official web site.