Greater Bay Area needs buy-in from banks and financial institutions

With the Hong Kong and Beijing governments putting their muscle behind the Greater Bay Area (GBA) initiative, there is every reason to believe the region can create a global economic powerhouse.

The area includes some of China’s most dynamic cities, with abundant expertise in trade, manufacturing, services, and hi-tech innovation. But if their clients are to capitalise on the opportunities, leading banks and financial institutions must ensure the requisite services, infrastructure and personnel are in place to assist development, finance trade, facilitate investment, and generally smooth the way.

“We have set up two dedicated teams in Guangdong and Hong Kong to support the business ambitions of technology companies in the Greater Bay Area,” says Diana Cesar, CEO, Hong Kong, for HSBC. “These will allow us to better support the innovation ecosystem by providing customised services and products for local start-ups and advanced manufacturing companies.”

Much of the new economic activity is expected to include a large cross-border element. The bank expects growing demand for its trade financing, payments, risk management and advisory services. An in-house “Pivot to Asia” strategy signalled a commitment to expansion across the Pearl River Delta (PRD), and sees HSBC as the only foreign bank with a presence in Guangdong’s 21 prefecture-level cities.

“Innovation and technology are policy priorities for Guangdong,” Cesar says, noting the province is home to around 33,000 hi-tech companies, a fivefold increase in the past five years. “With a universal banking platform and strong cross-border capabilities, we have become the banking partner for many leading tech companies in the region. The number of tech customers served by our commercial banking business in the PRD has more than doubled over the past three years. We believe the GBA plan to combine complementary advantages will generate tremendous opportunities for years to come.”

For Ayesha Lau, managing partner in Hong Kong for KPMG China, the prospect of a single connected market can’t fail to create more demand for banking, insurance, financing and leasing services. These may primarily be to support the manufacture and export of higher-value goods and services, but businesses across every other sector also stand to benefit.

Lau notes that a goal of the GBA initiative is to enhance the quality of life by developing smart cities and world-class infrastructure. With that will come new facilities for sports, culture, recreation and tourism, providing openings for real estate investors, fund managers and venture capitalists with an eye for sound fundamentals and steady returns.