Hong Kong, January 21:

Hong Kong’s bid to keep pace with China’s breakneck economic growth by strengthening

its own status as a global financial centre could face stiff opposition from mainland cities, analysts warn.

The southern Chinese territory’s government last week unveiled a series of economic proposals designed to fit in with China’s recent 11th five-year development plan, which many felt ominously omitted any mention of Hong Kong.

A key plank of the proposals was to strengthen the former British colony’s powerful financial services sector, which for decades has provided a gateway to financing deals between China and the rest of the world.

However, analysts said the proposals could conflict with the plans of other major Chinese cities such as Guangzhou, Shenzhen and Shanghai, which also want a share of the booming Chinese economy.

“We are worried that we are being gradually marginalised. The slow decline is very real,” said Joseph Cheng, political science professor at Hong Kong’s City University.

“With more mainland cities opening up, we have to make sure that we continue to improve ourselves and fight off competition in order to survive,” he said. Since China’s accession to the World Trade Organisation (WTO) in 2001, there has been a huge increase in direct foreign investment into the country, boosting major cities across the nation. Economic ties between Hong Kong and China have also grown closer, with authorities in Beijing expanding a free trade pact with the territory and allowing millions of mainland tourists to visit the city.

But Hong Kong faces increasing challenges, particularly in the logistics industry, from the nearby Pearl River Delta, which has established itself as a booming manufacturing centre due to its lower handling costs.

At the unveiling of Hong Kong’s plan last week, high-level government officials and business tycoons urged Beijing to make the city “China’s international financial centre of global importance”.

After months of intense preparation, Hong Kong rolled out strategic measures containing more than 200 action points to integrate with China’s 11th five-year plan, which focuses on economic development for 2006-2010.