• Thu
  • Dec 25, 2014
  • Updated: 3:28pm
Column
PUBLISHED : Friday, 15 March, 2013, 12:00am
UPDATED : Friday, 07 June, 2013, 11:40am

Common sense evaporates as milk mania takes hold

Plethora of controls hurt the innocent where a straightforward solution would have sufficed

BIO

Mike Rowse has lived in Hong Kong since 1972, and is a naturalised Chinese citizen. He spent 6 years in the ICAC from 1974 – 1980, then 28 years in the Government as an Administrative Officer until retirement in December 2008. He is now the Search Director for Stanton Chase International, and also hosts a radio talk show and writes regularly for both English and Chinese media.
 

There is a Law of Unforeseen Consequences and one of our universities had better start to teach a course in it soon.

Some of our ministers could certainly benefit from studying the subject, and the sooner the better.

It has always been the case that no person or institution, however worthy or careful, can be expected to anticipate the full effect of every decision made or action taken.

Nor does the underlying motive seem to count for much. A charitable or other worthy act is just as likely to go off course as a bank robbery or kidnapping.

Case studies are all the rage, so in preparation for the new MBA let us take as a prime example of the genre the recent efforts to control (read "stop") what is now known as parallel-goods trading.

Everyone involved seems to have lost sight of what the actual problem was (or is) so that the various measures now being introduced or amended are actually addressing deficiencies in earlier decisions rather than the root cause, with the result that the collateral damage to innocent parties has become greater than the effectiveness against the original situation.

The basic problem concerned infant formula milk powder. Some people were buying up lots of it from shops in Sheung Shui, the closest train stop to the border, then carrying it to Shenzhen for resale at a profit.

The consequences were a distorted market for those products in Sheung Shui stores, and in extreme cases even unavailability to local mothers wishing to feed their babies. A side effect was the disturbance to train passengers of persons carrying large quantities of goods with them.

If the surge in demand for quality milk powder is mainly north of the border, then the obvious thing to do is for the companies concerned to deliver it directly to that market. If that is not practicable or effective - because of the possibility of counterfeit products being sold in genuine or genuine-looking tins, considering the mainland does not have a good track record in this area - then the sale point in Hong Kong should be as close as possible to the border.

What we need is a giant milk powder warehouse next to Lo Wu station.

That would immediately eliminate the problem of disturbance to rail passengers because the couriers, whether mainlanders or locals, would just walk back and forth across the bridge all day. Removing extraneous demand from Sheung Shui would enable the local market to revert to the former equilibrium.

Instead of this common sense arrangement we have a plethora of controls that are causing havoc, and more are being mooted.

Controlling purchases within, and train boarding at, Sheung Shui simply pushed the problem out to other stops along the line. Introducing controls on the size and/or weight of luggage has caused disruption to bona fide cross-border travellers and even ordinary couriers within Hong Kong.

When the issue first came into the public arena, it was presented as wicked outsiders coming to our city to misbehave. In fact, legitimate trading is what Hong Kong is famous for and is acceptable - even welcome - behaviour. Every day thousands of businesspeople arrive at our airport for that purpose. We even have a statutory body called the Trade Development Council to encourage them to come. Why are we suddenly saying this is illegal?

Moreover it turns out most of the traders are local residents making an honest buck.

We set out to stop outsiders raiding out stocks of an important commodity. We ended up treating honest people as criminals and obstructing local messengers from going about their lawful business.

That's what happens when you treat the symptoms rather than the disease.

Mike Rowse is the search director of Stanton Chase International and an adjunct professor at Chinese University

 

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3

This article is now closed to comments

rpasea
Come on, Mike. We can't have common sense dictating policy now can we?
crbfile
CHEERS! CHEERS! CHEERS!
but does HK have only one person with common sense?
tsk tsk shame on HK!
oxymoron2
I never get tired of saying this: You open a can of worms, collateral damage is imminent.
 
 
 
 
 

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