Guangdong and Hong Kong should take Singapore as a reference for establishing a financial holding company for investing in large cross-border infrastructural projects, local think tank Bauhinia Foundation Research Centre suggested yesterday.

That is one of the 22 suggestions made by the center to accelerate economic integration between Guangdong and Hong Kong in its report titled Creating a World-Class Pearl River Delta (PRD) Metropolis released yesterday.

The study found that infrastructural projects in the region are essential to turning the region - whose per capital gross domestic product (GDP) by 2038 is expected to reach $45,000, exceeding the average of New York, Tokyo and London by 50 percent - into a metropolis.

The center noted that Singapore's Temasek Holdings, the city-state government investment arm which owns 20 large government-linked companies that account for 12 percent of the country's GDP, serves as a good example for Guangdong and Hong Kong.

The holding company will oversee the financing and operation of the cross-border infrastructural projects according to market principles.

The study suggested that a similar organization be established for the Hong Kong-Zhuhai-Macao Bridge, adding the construction of the mega bridge should start as soon as possible.

The center chairman, Anthony Wu, also believed establishing such a holding company will help the region face the current financial crisis.

"The United States invested a lot in railway projects during the Great Depression. Investing in infrastructure is essential to reviving the economy," he said. "We can better face the financial crisis if we have such a company to make quick decisions and put money into infrastructural projects."

The study also suggested that Guangdong and Hong Kong form a Pearl River Delta rail transport corporation to plan, construct and operate rail links, or entrust or invite the Mass Transit Railway Corporation in Hong Kong to participate in the projects.

The use of Octopus cards should be made more widespread in the region to facilitate and boost consumption, the study suggested.

The center's senior research fellow, Zhu Wenhui, said the card should be used to store personal information as well, such as medical records, to facilitate the use of services.

The study also suggested that Shenzhen and Hong Kong can cooperate in building hospitals and schools. Guangdong, Hong Kong and Macao should join hands in developing Zhuhai's Hengqin Island into a business and resort center.

The study said nearly 80 percent of the 2,000 residents interviewed had high hopes about cooperation between Guangdong and Hong Kong, but added that differences in the political, economic, legal and public administration systems could create obstacles.

The report, which was also based on interviews with government officials and business representatives, found that Hong Kong government officials are not as bold and decisive as their mainland counterparts in putting forward new ideas because they are under pressure created by different interest groups.

The study called for liberation of mindset among people in the PRD region in order to move toward economic integration to ensure prosperity.

(HK Edition 10/29/2008 page1)