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Guangdong Governor Says Not In Competition With Hong Kong

by Mary Swire, Tax-News.com, Hong Kong

12 March 2002

Speaking during the National People's Congress in Beijing, Guangdong Governor Lu Ruihua denied yesterday that the region's push to become a regional logistics centre would mean extra competition for Hong Kong.

"There is no rivalry between Guangdong and Hong Kong to develop the logistics sector. Instead we, as brothers, are developing close co-operative relations to develop the business,'' he said.

At the beginning of this year, Lu disclosed ambitious plans to turn the Pearl River Delta into a logistics hub serving the whole of Southeast Asia, but says that Guangdong, a manufacturing base, and Hong Kong, a centre for trade and financial services, should join forces. "I hope the development of the logistics sector will provide opportunities for Guangdong and Hong Kong to enhance their economic development,'' he said.

Lu also denied suggestions that the answer to jams at border crossings between the province and Hong Kong was in extending checkpoint hours to round the clock. ''There are effective ways to improve the situation, including widening the Lo Wu bridge, building a western corridor connecting Hong Kong with Shenzhen and linking up the SAR's railway network with that of the Pearl River Delta," he said.

Lu did not believe the introduction of a land-departure tax in 12 months' time, as proposed in the SAR's budget last week, would reduce border crossings.

''The tax is only $18 and we don't charge any tax, so exchanges between the two places will remain unchanged,'' he said.

The Governor also said yesterday that the province aims to develop its high-tech sector, and that Hong Kong and Guangdong should complement each other's efforts to develop their respective high-tech sectors. But Lu said Hong Kong and Guangdong had yet to decide on the details of their co-operation.

Answering criticisms that economic development in the province was favouring some citizens at the expense of others, Lu took a robust line: ''It is impossible that there will be an even distribution of resources or economic development in the province. How can you expect places with scarce resources to develop into prosperous cities? So let some places become rich first and lead other places to becoming rich later,'' he said.

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