Land policy makes mockery of claim to 'economic freedom'

PUBLISHED : Monday, 22 January, 2007, 12:00am
UPDATED : Monday, 22 January, 2007, 12:00am

Any excitement at Hong Kong's ranking last week by The Heritage Foundation as the 'world's freest economy' is misplaced. We urge readers to consider a recent study by the Bauhinia Foundation Research Centre and Enright, Scott & Associates, titled 'Hong Kong's Competitiveness'. It reports that the importance of land prices - and the government's enormous influence thereon - disqualifies the city as a free economy. It finds that control of land supply and the use of land premiums and licences gives the government enormous discretion that 'works as a brake on companies' that do not wish to get on its wrong side.

Not only does our land policy disqualify us as a free economy, it is a threat to our competitiveness and long-term economic viability.

'Property prices and policy are probably the most important features that influence Hong Kong's ability to be cost-competitive', the report finds, with housing costs its 'major source of cost disadvantage'.

Given the importance of producer and professional services to Hong Kong's competitiveness as a 'world-city economy', our ability to attract and retain talent depends on our living and social environment.

'It is specifically these areas that need attention in Hong Kong,' the report finds. The Chinese Academy of Social Sciences ranks Hong Kong fourth among Chinese cities for living environment competitiveness. This, concludes the report, is a sign of Hong Kong's deteriorating physical environment and crowded, cramped living space. 'Hong Kong is becoming a 'hardship' posting for major multinational companies, due to pollution, lack of living space, expense and lack of suitable schooling.'

Here's the bottom line: Hong Kong is not a free economy, and the government's stranglehold on the economy through its land and planning polices is unsustainable.


Hong Kong Harbour District

Inquiry required

Recent letters to this page reflect the deep frustration of the community on the subject of Wedding Card Street and other high-rise, high-density urban renewal projects damaging local communities and neighbourhoods. It is now time for the government to establish an independent inquiry to investigate:

The profit motive of the Urban Renewal Authority, which confiscates private ownership rights in six-storey buildings so that it can put up 50-storey projects and share the profits from these with developers;

What criteria the Urban Renewal Authority uses to select which buildings should be demolished. The Basic Law guarantees all property ownership rights, making no distinction between old or new buildings. Owning an old building is not a criminal offence requiring confiscation of property rights;

The measures used to control development density, as the formula now used leads to excessive heights and volumes in urban renewal projects; and

Zonings practices that enable the Urban Renewal Authority and the developer to take over the driving seat in the planning system. The government's recent proposals for improving heritage protection are welcome, but only address the symptoms. The main source of the public frustration is the reluctance of town planners and the Town Planning Board to specify plot-ratio controls when introducing planning zones.

Another problem is the constant appointment of unqualified and inexperienced officials to leadership roles in the Housing, Planning and Lands Bureau and, more particularly, to the position of chairman of the Town Planning Board.


Legally all in order

I refer to the letters 'No way to seek views on Sokos' (January 17) by Annelise Connell and 'Consultation eludes us' (January 19) from Richard Fielding. There is some misconception and I wish to clarify the position for the benefit of your readers.

Under the Environmental Impact Assessment Ordinance, there are well-defined requirements on public inspection of environmental impact assessment (EIA) reports and related arrangements. In respect of the proposed liquefied natural gas project on the Sokos, CLP Power has followed such requirements, and advertised the availability of the report in an English-language newspaper and a Chinese-language newspaper, on December 27 and January 6 and 16. CLP Power has also made the report available at the EIA Ordinance Register Office and at the Environmental Protection Department's resource centres in Wan Chai, Tsuen Wan and Fanling, district offices in Kwai Tsing, the Islands, Tuen Mun, Yau Tsim Mong and Southern, and at its own office in Mong Kok. The report is also available online at

Section 7 (4) of the ordinance requires the director of environmental protection to notify the Advisory Council on the Environment that the report is suitable for public inspection. The council may give any comments it has on the report to the director within 60 days of receiving a copy.

The ordinance does not give the director of environmental protection any discretion to extend the period of public inspection, other than in the limited circumstances such as non-compliance with requirements such as those on advertising and public exhibition. In this case, the applicant has complied with these requirements. There are no grounds for our department to ask for an extension of the public-inspection period, which ends on Thursday. The advisory council will give its comments to the director on or before February 24.

ELVIS AU, assistant director, Environmental Protection Department

How to comment

We note that several readers have had difficulty finding out how to submit their comments to the government about the environmental impact assessment report on a liquefied natural gas terminal on the Soko Islands ('No way to seek views on Sokos', January 17 and 'Consultation eludes us', January 19).

CLP Power is keen for the government to see public comments on this important project, and I would like to provide the links below, for your readers' convenience.

A Public Comment Form for Application (Environmental Impact Assessment) is available at

index3.html. It should be filled in and submitted to the director of environmental protection before the public inspection period expires on Thursday. It can be faxed to 2147 0894 or posted to the EIA Ordinance Register Office, 27th floor, Southorn Centre, 130 Hennessy Road, Wan Chai. Public comments may also be e-mailed to

You can also find the report, and English and Chinese summaries on CLP Power's bilingual website at There is a clear link on the site to the government's public comment form.


What happy employees?

I was shocked by Andrew Work's Insight article 'A whipping boy for our socialists' (January 18), it being rare to read such blatantly one-sided polemic in a newspaper of the calibre of the South China Morning Post.

I doubt that any of the more than 1 million Wal-Mart employees who have been forced to file lawsuits against the company in order to secure even the most basic, legally protected work conditions would recognise themselves as 'happy Wal-Mart employees', to use Mr Work's words. Nor would the many unions that have faced Wal-Mart's union-busting tactics consider the employees happy. Wal-Mart's anti-union policies are so strong that the company has closed entire stores (in Quebec and California) when their 'happy employees' have tried union action.

As for calling the good people of the state of Maryland socialists because they voted to require health benefits for employees, I doubt that an 8 per cent payroll contribution towards health care qualifies as socialism anywhere in the world outside Mr Work's avid imagination.

As for The Link Reit, it was government property that was turned over for the reit, leaving tenants at the mercy of a for-profit company. This has led to hardship for many tenants - those who qualified for housing assistance and others who provided goods and services affordable by the people living on the housing estates. Many shopping malls offer high-priced goods. Allowing a few shops that cater for the lower purchasing power of the economically less fortunate in our community is apparently of little importance to Mr Work. But then, one doesn't get the impression that he has spent a lifetime working for poverty wages.


Convert to diesel

To reduce the amount of carbon dioxide emitted by vehicles, the right thing to do is to encourage taxis and minibuses to change to diesel (And private cars? Why not?). The diesel engine is about twice as fuel-efficient as the petrol engine used by private cars or the LPG engine used by taxis and minibuses, and so produces only about half as much carbon dioxide. At the same time, with the introduction of the Euro IV standard of emission, vehicles are no longer the smoke-belching monsters they used to be.