Once dismissed as a mere concept, China’s Greater Bay Area (GBA), a cross-border region spanning Hong Kong and central Guangdong province, is slowly but steadily becoming a financial and economic reality.
A region-within-a-region, the GBA generated more than $2 trillion in output in 2023 – on a par with the entire economies of South Korea or Canada – and is home to many of the country’s most innovative firms. At the heart of the process is the increasingly free flow of individual customers and the capital they own and can deploy.
In the past, financial institutions on either side of China’s hard border struggled to move capital easily from, say, Hong Kong (which is offshore) and Shenzhen (which sits onshore), due to differing regulations on either side. As a result, banks designed processes that focused solely on local compliance, rather than considering the holistic benefits presented by the GBA.
Thus, if a Hong Kong customer visited Shenzhen to open a new account at the same bank, he or she would in the past have been treated as a new customer, requiring them to start from scratch.
Key difference in policy support
What then has changed? The Pearl River Delta, which binds Guangdong to Hong Kong, has existed as a concept since 1947, and has been an economic powerhouse for decades.
