Laissez-faire Hong Kong meets the five-year plan

Victoria Harbour in Hong Kong on Jun. 21. The city’s new five-year plan marks a shift toward modern industrial policy as it embraces state-led incentives to reshape its economic future. | Bloomberg

Sep 22, 2026

Milton Friedman was baffled by Hong Kong. During his second visit in 1963, there was pulsating activity all around him — but no official data. Why wasn’t the colonial administration crowing about its achievements, he asked. The absence of a gross domestic product series wasn’t an oversight, as John Cowperthwaite, Hong Kong’s financial secretary at the time, explained to the celebrated American economist: “If I let them compute those statistics, they’ll want to use them for planning.”

That aversion to state intervention, long believed to be the mantra of Hong Kong’s capitalist success, was recently consigned to history with the unveiling of the financial center’s first five-year plan.

It’s natural to view this as more evidence that the city is hewing its policy apparatus closer to the mainland ahead of the 30th anniversary of its handover to China next year. (Beijing just launched its 15th five-year plan.) However, the larger significance of the move is that Chief Executive John Lee is jumping on a global bandwagon.

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