How markets will test Hong Kong’s new economic model

For the first time in its history – and in a striking departure from its long-standing doctrine of minimal economic intervention – Hong Kong is preparing to draw up a five-year plan.

Chief Executive John Lee Ka-chiu has asked all policy bureaus to help draft proposals by the end of the year. To lead the exercise, veteran civil servant Janice Tse Siu-wah has come out of retirement. The Legislative Council, not to be left out, has formed a committee supported by six coordinating groups spanning nearly every major policy domain.

This is more than an administrative exercise. It marks a fundamental shift in Hong Kong’s economic philosophy.

For decades, the city has prided itself on low taxes, light regulation and market-led growth. Now it is moving – cautiously but unmistakably – towards a model more aligned with mainland China’s state-led development strategy.

Conventional economic thinking has long held that markets are best at allocating resources and driving innovation. Yet mainland China’s rise has challenged this orthodoxy. Through long-term planning, policy coordination and targeted investment, it has become the world’s second-largest economy and a formidable technological power.

This model is not simply about central control. It combines top-level strategic direction with broad consultation and coordinated execution. The result is an ability to mobilise resources at scale towards national priorities.

South China Morning Post