Hong Kong has no future without mainland
Last decade has seen city thrive as mainlanders and their money flow in, with benefits of this integration far outweighing any costs
What difference did a decade make? A noticeable one is the whopping 216 per cent increase in home prices over the past 10 years. Another one is that the Hong Kong dollar slipped below parity with the yuan.
But arguably, the most prominent change is the reversal of trends in cross-border shopping, living and investing.
In 2003, the local economy was under the threat that the mainland would hollow out Hong Kong. At that time, a lot of local entrepreneurs had long since shifted their focus to north of the border. What's more, a lot of Hongkongers liked shopping and spending in Guangdong.
Adding insult to injury, cheap home prices on the mainland attracted an increasing number of Hongkongers to reside there. According to government data, 214,000 Hong Kong households owned or rented residential properties on the mainland in 2003, up 13.5 per cent over just two years. Back then, there was even a growing fear of a mass exodus of home buyers.
Ten years later, the flow between Hong Kong and the mainland has long since turned around. No longer suffering from a drain to the north, Hong Kong's economy and property market have benefited from the closer integration with the mainland, and these cross-border economic activities are destined to grow and provide strong support for the local economy.
For a start, consumption by mainland visitors to Hong Kong increased 226 per cent over the period from 2003 to 2011, dwarfing the spending of Hongkongers on the mainland. The strong spending power of the mainland tourists has enticed top brands like the Gap and Abercrombie & Fitch to open stores in Hong Kong, strengthening its role as a shopping paradise.