No need to fret about a land lease 'cliff' in 2047
The year I celebrate my 99th birthday, leases of 50 years after handover will still be valid
All the talk now in world business circles is about a so-called financial "cliff", when savage spending cuts and sharp tax increases are scheduled to kick in to compensate for past failures to reach a sensible bipartisan deal on the United States budget.
Hong Kong faced its own famous cliff, of a socio-political nature, in 1997. Under various unequal treaties imposed on China in the 19th century, Hong Kong Island and the tip of the Kowloon peninsula were ceded in perpetuity to Britain, but the great bulk of Hong Kong, some 90 per cent, still called to this day the New Territories, was the subject of a 99-year lease running from July 1, 1898.
Notwithstanding that Chinese governments had long since repudiated all three treaties, there was the problem of what the British would do when their lease ran out.
The Sino-British Joint Declaration of 1984 restored the whole of Hong Kong to China and provided that life in the city would continue past 1997 "unchanged for 50 years".
Because of the wording, many people assume that the 1997 crunch date has been replaced by a new "cliff" in 2047. They may have been strengthened in this false belief by the fact that land sold by the Hong Kong government between 1985 and 1997 was subject to leases that ran for the balance of British administration plus 50 years, that is, they too would expire in 2047.
But the "logic" is flawed because it overlooks fundamental differences between the situations prevailing at the relevant times.
What made 1997 a real cliff was the issue of land tenure. The master lease, and all the sub-leases, would actually run out. It's not the same in 2047.
While it is correct that the leases for land sold after 1985 will run out when the time comes, land sold since 1997 has been subject (with one exception, which I will come back to) to a lease for 50 years running from a current date. In other words, land sold in 1998 has a lease up to 2048, land sold in 1999 goes until 2049, and so on. The government is empowered under the Basic Law to husband the resources of Hong Kong on behalf of the central government and has managed them in a sensible way. It will certainly renew leases expiring in 2047 as a matter of routine.
To sum up in simple terms, there is no land tenure cliff in 2047. That means there need be no socio-political cliff either. The pledge of 50 years unchanged is not followed by the words "and thereafter the mainland systems will apply". So there is only one certainty about 2047: I will celebrate my 99th birthday.
Back to the one exception to the 50-year rule. The land occupied by Hong Kong Disneyland is subject to a 100-year lease (technically, 50 plus 50). I know, because I did the deal, and the only person to pick up the point was then convenor of the Executive Council, one CY Leung. We finessed the issue then, and though I have not asked him about it recently, I don't think Mr Leung plans to reopen the case now.
After all, how could a person known as "Mickey Mouse" render himself homeless when still a sprightly 99-year-old?
Mike Rowse is the search director of Stanton Chase International and an adjunct professor at the Chinese University of Hong Kong.