As the first anniversary of the Guangdong-Macao In-Depth Cooperation Zone in Hengqin approaches, a review is being made of its novel mechanism of extensive consultation, joint contributions, mutual management, and benefits shared between the province and the special administrative region.

Once a rural border island, Hengqin has become a modern urban city and frontier for opening up to the world. A major step forward was taken on Sept 5, 2021 when the Overall Development Plan for Construction of the Cooperation Zone in Hengqin was released by the CPC Central Committee and State Council. Right afterward, the Cooperation Zone was unveiled on Sept 17, 2021 to jointly connect industrial development and integrate livelihoods of the two regions. 

Hengqin has been connecting rules and docking mechanisms of the two regions so that there now are 3,600 items of government affairs that can be handled online, and a "cross-border handling" work mechanism piloted for commercial registration. These allow Macao enterprises to settle in the Cooperation Zone without sending someone personally to Hengqin.

Hengqin Island [Photo courtesy WeChat account: hengqinzaixian2021]

The first preferential tax policies were issued this year by the State and provincial governments to create a taxation environment like that of the Macao Special Administrative Region. Hengqin has also generated 600 reform and innovative measures, and four are listed among the best institutional innovation cases in nationwide free trade zones.

Meanwhile, construction of Hengqin Checkpoint Phase II in the "first line" (Hengqin Island-Macao) and infrastructure facilities of "second line" (Hengqin Island-the Chinese Mainland) is well underway to ensure closed operation in 2022. The new line-division management to expedite "first-line" customs inspection, strictly control "second-line" examinations, and separate persons from goods is to firmly advance the integrated development of Hengqin and Macao.

Staying true to the original aspiration of facilitating Macao moderate economic diversification, Hengqin is adjacent to Macao, learns from international experience, and forms a distinctive “innovation driven + market driven” industrial development path, noted Gong Bin, director of the Zhuhai Advanced Integrated Circuit Institute.

Based on endowed resources and the ongoing development of Guangdong and Macao, Hengqin promotes growth of the real economy with policy supports bringing the Cooperation Zone 10,000 sci-tech enterprises and 20 national and provincial sci-tech innovation platforms, including enterprise incubators and new-type R&D institutions.

An industrial cluster of 226 enterprises has taken shape at the Traditional Chinese Medicine Science & Technology Industrial Park of Cooperation Between Guangdong and Macao. Companies involved in TCM, medical apparatus, biomedicine, and medical services are registered here.  

Hengqin recorded an annual regional Gross Domestic Product (GDP) of 45.46 billion yuan ($7.15 billion) in 2021, up by 8.5 percent year-on-year. The added value of industries above designated size soared 54.8 percent to 359 million yuan ($53 million) in the first half of 2022.

Of note, the added value of the finance industry increased by 8.21 billion yuan ($1.2 billion) with a year-on-year growth rate of 11 percent, accounting for 36.7 percent of regional GDP. Seven hundred financial enterprises were located in Hengqin as of late June.

Due to constantly improving infrastructure, scientific research conditions, and a spirit of enterprising innovation, Hengqin also has attracted numerous high-quality talents and enterprises from Hong Kong and Macao. These include Zhuhai Nanometals Technology and the Zhuhai UM Science & Technology Research Institute.

To boost innovation and entrepreneurship, the Cooperation Zone issued measures for rent subsidies and cross-border practice of Hong Kong and Macao professionals. Qualified industrial enterprises in Hengqin receive a preferential corporate income tax rate of 15 percent, while the individual income tax rate for high-end and urgently needed talents in the zone is capped at 15 percent. Moreover, local platforms like Macao-Hengqin Youth Entrepreneurship Valley offer one-stop professional services for in-house enterprises, talents, investment attraction, and more.

From financial support and platform building to talent awards and subsidies, Hengqin has persistently boosted employment and entrepreneurship. As of June, there were 562 Hong Kong and Macao youth enterprises, including 519 Macao projects, incubated in Hengqin. Meanwhile, more than a thousand Macao professionals in construction, design, tourism, and healthcare obtained qualifications for cross-border practice.

Moreover, the docking of public services and social security systems is rapidly creating a living circle like that of Macao. For example, Macao New Neighborhood is being developed as the first comprehensive livelihood project tailored for Macao citizens in the Chinese mainland. As of June 2022, residence permits in Hengqin have been attained by 8,906 Macao residents while public medical institutes in Hengqin have provided services for 74,000 Macao people.