The Hong Kong-Zhuhai-Macau bridge can be leveraged to create a bridgehead economy. Photo: K.Y. Cheng
Concrete Analysis
by Marcos Chan
Concrete Analysis
by Marcos Chan

Bridgehead economy on Lantau could play key role in Pearl River Delta

Hong Kong-Zhuhai-Macau bridge could pave the way for more development on Lantau to help ease land resource issues

The recent announcement of a two-year delay to the completion of the Guangzhou-Shenzhen-Hong Kong Express Rail Link has come as a great disappointment to the general public and policymakers.

Let us hope there will not be a similar holdup to the construction of the Hong Kong-Zhuhai-Macau Bridge, which is scheduled for completion in 2016.

The completion of the bridge will be a crucial strategic step towards filling in the missing link between Hong Kong and the western shore of the Pearl River Delta to form a triangular route connecting the key cities in the delta that will facilitate business and tourism flows within the region.

Headline statistics for the delta show that the western area trails the central and eastern zones in terms of economic development. The central and eastern zones, led by Guangzhou and Shenzhen respectively, each have a gross domestic product of roughly US$350 billion. However, GDP in the western zone is less than a third of this figure.

A comprehensive masterplan is required to make the best use of what is a massive land bank

This leads one to ask whether the bridge will primarily benefit cities in the western zone. I believe this will not be the case. If Hong Kong can leverage on the bridge and develop a bridgehead economy on Lantau Island, this will help solve various bottleneck issues facing the city.

In recent years the rapid growth of tourism in Hong Kong - particularly in the number of arrivals from the mainland - has strained the city's resources and stretched its handling capacity.

However, a small open economy such as Hong Kong has little choice but to rely heavily on the services sector. In addition to the financial and trading sectors, retail and tourism play an important role in the city's economy. Therefore, the government should be looking at ways to extend the city's capacity to meet the needs of tourism without damaging social harmony.

The root of a number of prevailing social challenges in Hong Kong lies in the lack of hardware capacity to support socio-economic activity.

For example, the property market has been running on low vacancy rates across all sectors. There is also strong demand from the public for more community facilities, such as hospitals, kindergartens, schools and cemeteries. However, the availability of land to build these facilities remains very tight.

The proper planning and development of a bridgehead economy on Lantau would provide Hong Kong with a strong platform to solve some of its challenges related to land resources while also allowing the city to leverage on the continuing emergence of the 65-million population mega-metropolis in the delta region.

Hong Kong will play a critical role in the future development of this mega-metropolis. Upon completion of the bridge, the city will be just 30-40 minutes away from Qianhai, the special economic zone in Shenzhen to be used as a test bed for China's yuan liberalisation and financial reform, and Hengqin Island, off Macau, which has been earmarked as a strategic hub for tourism development.

Sitting between these two important nodes, Hong Kong can facilitate the flow of business, knowledge, money, people and trade among the three locations, leveraging on the cross-border railway and road infrastructure planned to connect the mainland from Lantau.

The construction of a third airport runway at Chek Lap Kok, should it go ahead, would strengthen the city's competitiveness in the face of the rising challenge posed by other airports in the delta region, while the proposal to reclaim 1,000 hectares of land to create an East Lantau metropolis would help Hong Kong cement its status as a regional hub for commerce and tourism.

The development of Lantau should be carefully planned and implemented. A comprehensive masterplan is required to make the best use of what is a massive land bank. The development of Lantau would also serve as a long-term sustainable development model for Hong Kong.

Tourism should be a major component of any development plan for Lantau and would help lengthen the average stay of tourists in Hong Kong and establish the delta region as one Asia's foremost tourism destinations.

The development of Lantau is not just about building more hotels and shopping centres. The government needs to ensure that the island can accommodate the needs of residents and tourists. The island should have a balanced combination of tourist attractions with a range of hotels and resorts; shopping centres; facilities for meetings, incentive travel, conferences and exhibitions; ancillary offices and, crucially, a suitable mix of residential estates and local community facilities.

This type of development model will encourage tourists to stay and spend on Lantau, thereby alleviating some of the pressure on downtown Hong Kong, while also making new towns such as Tung Chung a more attractive home for residents by creating more local job opportunities.

An effective masterplan taking into account land usage, job opportunities, the living environment and connectivity between the urban areas of Hong Kong, Lantau and the rest of the delta will be critical to the success of a bridgehead economy.

The government should also have a vision of how Lantau can blend in with the long-term development of Hong Kong, and in particular how it relates to the future role of Central, Kowloon East and West Kowloon.

This article appeared in the South China Morning Post print edition as: Bridgehead economy can play a key role in the delta