Immobile minds that are holding back Hong Kong
SCMP April 30 2009
Hong Kong Mobile - Making a Global Population: I commend this collection
of essays on Hong Kong's past and potential future, published by Hong
Kong University Press with the support of the 2022 Foundation, to those
who care about sustaining its dynamism. Indeed, if the authors could
distil its 480 pages into a 20-page executive summary it should be
made compulsory reading for all senior officials and members of government
I will not attempt a summary in just a paragraph. Suffice to say that
it is about the crucial importance of geographic and social mobility,
and the need for constant renewal if Hong Kong is to retain its global
outlook and dynamism at a time when its population is ageing and when
forces protecting the status quo may be growing more powerful.
Hong Kong is an anomalous place that can only thrive by doing things
that are to the advantage of its neighbours, be they the mainland,
East Asia or the world of commerce and finance. And it can only do
those if it is open to the talent and ideas of individuals; local,
mainland and foreign.
A platitude? Perhaps. But look at some of the news from the past week,
which point in a backward direction. The Mortgage Corporation is to
expand into Shenzhen. A fine example of taking advantage of the Pearl
River Delta? No, expansion of the government bureaucracy via the out-of-control
Hong Kong Monetary Authority. The Mortgage Corporation is barely needed
in Hong Kong itself, yet uses its status as a government entity to
supplant private funding.
Its move into Shenzhen, like its earlier one to Malaysia, simply creates
more high-paying jobs, and hence patronage, for officials. The Mortgage
Corporation, and other trading entities, should be sold off or at least
become public companies. It should focus on the proper role of government.
Yet in every direction, from culture to finance, civil servants with
qualifications that only appeal to fellow civil servants are taking
Sports sector legislator Timothy Fok Tsun-ting is, this newspaper
reports, grooming his son to succeed him. I do not doubt that Mr Fok
senior works hard to promote sports' interests. But also I do not doubt
that he holds this position because his father, Henry Fok Ying-tung,
was a major business and political figure. Feudalism has its place
in decentralised, pre-industrial societies - not in Hong Kong. Let
Mr Fok and the landed aristocracy enjoy their wealth, but put sports
in the hands of those with proven leadership in sport, as players or
managers, or in some business requiring inspirational skills.
The Consumer Council has again confirmed what we already knew - that
the two supermarket chains routinely engage in practices designed to
maximise profits from their duopoly. They confirm Adam Smith's comment
that 'people of the same trade seldom meet together, even for merriment
and diversion, but the conversation ends in a conspiracy against the
public, or in some contrivance to raise prices'. Hong Kong's cartels
deliver unearned rents to these groups at the expense of the individuals
and businesses that provide Hong Kong with its dynamism.
New housing starts have fallen to a multi-year low. This suits developers
with old land banks and a government that wants to keep land prices
high. The government's application system is claimed to reflect a free
market. But, as the government determines both the number of sites
on offer and the acceptable price, that claim is nonsense. The result?
Feeble private construction that is a drag on the economy, and high
costs that deter new businesses.
Russian tourists are to be allowed visa-free access. It is only 20
years since Glasnost, only 10 years since I raised the issue in these
columns. And the now the government has made a decision! Well done,
lads. There's mobility for you.
This is just a week of events holding back Hong Kong. Later I will
look at five things that could drive it forward. Meanwhile, look at