Gordon Wu's case on land use misses Hong Kong reality
No one who exhorts Hong Kongers to be more like the people of Singapore is ever likely to get a sympathetic hearing in this city. It is hardly surprising then that property and infrastructure tycoon Sir Gordon Wu, chairman of Hopewell Holdings, had a somewhat chilly reception last week when he urged exactly that.
His audience at Friday's American Chamber of Commerce lunch was polite enough - Amcham members don't throw the bread rolls at speakers with whom they disagree - but to judge by the sly smiles and rolling eyeballs, his listeners were a tad sceptical, to say the least.
Sir Gordon was not - on this occasion anyway - advising frustrated democrats to be more like Singapore's pliable populace. His topic of the day was land use and his argument was, quite simply, that more of Hong Kong's land should be used.
Sir Gordon reminded us of what we all know: that Hong Kong is an extremely crowded place. In Kowloon, the population density is more than 43,000 people per square kilometre. That compares to 991 people per square kilometre in Guangzhou and just 687 in Beijing, according to the tycoon.
Cramming people together so tightly is disruptive, believes Sir Gordon. It distorts behaviour patterns and threatens to break up families.
The problem is that so little of Hong Kong is developed, he says. Government figures show that less than a quarter of the territory's land area is developed for any purpose. Two-thirds remains grassland, scrub, woods or marsh.
If more of this land were used, we would not be so jampacked together. Sir Gordon points out that with a population of 6.88 million and a total land area of 1,104 square kilometres, the overall population density for the whole territory is just 6,234 people per square kilometre, roughly the same as Singapore's. Yet Singapore is 'a garden city' where people live comfortably in spacious surroundings, he says.
'Singapore has done extremely well. They have been very wise and utilised land more efficiently,' Sir Gordon said. 'We should try to emulate Singapore.'
Failure to free more land for development will keep property prices and rents artificially high, erode Hong Kong's competitiveness, concentrate wealth in the hands of a small number of big developers, inflate another real estate bubble and leave the majority of us living in cramped and uncomfortable accommodation, he warns.
Of course, Sir Gordon is not a disinterested observer. As the inhabitant of one of the largest private houses in the city, he cannot claim to share the privations of most Hong Kongers. But, as the would-be developer of a 2,000-room mega-hotel in Wan Chai, he knows what it is like to fall foul of Hong Kong's stringent land-use rules. His argument is freeing more land for development would serve the common good but that is debatable.
Of the 730-odd square kilometres classed as grassland, scrub and woodland, 416 square kilometres make up our country parks. With 12 million visitors last year, it is fair to assume these are prized just as they are by a sizable proportion of the population. That leaves another 318 square kilometres of grassland outside the parks, some of which is water catchment and unsuitable for building. Some, however, could be freed for development.
A small amount is available now. The government is currently offering 32 sites, covering 0.24 square kilometre. But buyers are hardly queuing up. Of these sites, 11 have been on offer for almost two years with no takers.
The developers complain that the government is setting prices too high and certainly officials try to maximise the prices they get.
In the past, land sales have been a major source of revenue for the government and even in 2004, with land sales all but stalled, the administration still derived a sizable chunk of its income from property price-related sources such as stamp duty and rates.
If the government were now to begin opening up more land for development by selling it off cheaply, it would risk undermining its present and future revenue streams, forcing it to raise unpopular new taxes.
Far worse, however, it would risk undermining home prices across the city which would shatter the confidence of the population at large.
Hong Kong people might live in small, cramped apartments, but for the 54 per cent of households that own their own homes, their flats represent not just accommodation but a springboard to get ahead and a major investment for the future.
Trifling with property prices strikes at people's aspirations. Governments do it at their peril. That is something Hong Kong's administrators have learned the hard way, even if Sir Gordon has not.