Administration knuckles down to tackle land crisis

The Task Force on Land Supply appointed by the government to explore land options has just begun a five-month large-scale public consultation on the land options it came up with. It was reported that the public engagement contracts awarded to public relations firms amount to more than HK$10 million, so no one is underestimating the scale and difficulty of this consultation exercise. It is a widely known fact that Hong Kong has an acute land-supply shortage and everyone of us experiences this in our everyday life. Buying a home has become a distant dream for the younger generation. The housing rents are high and eat up a large chunk of our monthly incomes. Commercial rents are high, leading to steep costs for eating at restaurants and shopping at convenience stores. Small and medium-sized business owners can bear witness that rent, along with wages, accounts for a major portion of their operating costs.

Hong Kong has been plagued by a land shortage since colonial times and successive governments have tried to tackle this problem with various land policies and grand projects over the decades. However, in a way, Hong Kong is a victim of its own success. The status of an international financial center, the successful implementation of the “one country, two systems” policy and world-class city infrastructure have continued to attract more and more talents and companies from around the world to Hong Kong. In other words, land shortage is part of the price we have to pay for being such a great city.

We know that the current land shortage is caused by low or even no land development in the past decade or so, resulting in multi-faceted problems of “pricy”, “tiny” and “cramped” living conditions as categorically stated in the consultation document. We also know that the best way to ease land shortage is to continuously and steadily increase land supply. Various land-supply options are being discussed in the community: developing brownfield sites, tapping into private developers’ agricultural-land reserves in the New Territories, designate alternative uses of sites under private recreational leases, land reclamation outside Victoria Harbour, set up more new development areas in the New Territories, develop the periphery of country parks and increase the density of village-type development areas, etc. Looking back to Hong Kong’s development history and the experience of other metropolitan areas worldwide, the land-supply options are more or less the same as those enumerated by the comprehensive list drawn up by the task force.

Those options are nothing new, so why have they not been implemented? I believe the root cause of the problem is that Hong Kong’s political environment and social atmosphere are not conducive to rational policy discussion and compromises on major issues. Every one of the above-mentioned land development measures would no doubt hurt some vested interests and, at the same time, unevenly benefit certain segments of the community. Therefore, our community needs to objectively debate each policy option and accept the fact that we have to tolerate some give and take. Unfortunately, Hong Kong has been polarized by the opposition’s political bickering and populist messages. They are determined to use all sorts of excuses and allegations — such as government collusion with business, favoritism to the rich or outsiders and damage to the environment — to stop the development of Hong Kong. When confronted and asked to provide a solution to land shortage, their answers are often non-starters, such as rent control, which has been proven to be ineffective worldwide, and reducing new immigrants from the Chinese mainland, who are mostly coming to exercise their basic human right of reuniting with family members.

This administration and the chief executive are very courageous in starting a great debate on the land problem, something her predecessors did not do. A large-scale consultation exercise is no doubt a giant step in the right direction but the challenge has just begun. In coming months, the task force will no doubt be flooded with comments from different sectors of society that will be included in a thick and comprehensive report. The real challenge is how the government chooses and implements those policy options. Given the polarization of society and lack of a well-established and widely recognized mechanism to resolve policy disputes and foster compromise, the government is the only effective arbitrator. It must continue to demonstrate determination, as well as be open and balanced when deciding and explaining execution of those options.

The land shortage is the biggest livelihood issue the current administration confronts and probably one of the biggest tests for the incumbent chief executive. The problem has been delayed and continued to worsen for far too long. Nonetheless, while no one thinks it will be easy to tackle, the government has the power and ability to deal with this head-on and benefit Hong Kong for years to come.