Bulletin

An online magazine of news and opinions from the Asia New Zealand Foundation

Changes on Hong Kong's horizon

David Whitwam is the Chairman of the New Zealand Chamber of Commerce in Hong Kong. While in New Zealand for a series of Hong Kong New Zealand Business Association speaking engagements, Whitwam spoke to the Asia Media Centre to provide a snapshot of recent developments in Hong Kong, and the scale of its infrastructure boom.

Continue reading below.

The Hong Kong government

Carrie Lam, Hong Kong's chief executive

Hong Kong’s new government was installed on July 1, the anniversary of the “handover” of sovereignty from the United Kingdom to China. Carrie Lam, elected under the electoral system and appointed by China, became the city’s fourth chief executive.

The government was established under the “one country, two systems” framework and the overriding law is the “Basic Law”, which grants Hong Kongers protections of rights and freedoms.

“Carrie Lam is quite well-qualified in that she has previously been chief secretary for development,” Whitwam says. “Of all the CEOs they have had to date, she is probably the most rounded and experienced.

“She is a career civil servant and so far, she’s gotten quite a good run in the media, which in Hong Kong is quite helpful, in that a lot of the public believe everything they read in the newspaper. The only really negative publicity she had was when she gave more money for education!”

Hong Kong’s challenges

High-rise buildings in Hong Kong

One of the most immediate challenges is housing, Whitwam says.

“It’s not that there’s a shortage of housing in Hong Kong. Many investors, including those from the Mainland, love to leave their houses empty.”

With more than half of Hong Kong residents living in some form of government housing, the government is working hard to tackle the problem.

Longer-term challenges include the proposed Article 23 of Hong Kong’s Basic Law, an anti-subversion law. “There’s widespread concern that if they enact anti-subversion law it will restrict freedom of the press.”

Electoral reform continues to be a challenge, with attempts to introduce more democratic processes into the Hong Kong legislative system. “It was tried last year but it didn’t go through. It’s probably going to have to be introduced again this term.”

High-speed rail into China


A summary of the express rail link to Shenzhen. Video: SCMP

A particularly topical issue is “co-location of immigration”, which refers to plans for mainland Chinese authorities to be based at Hong Kong’s West Kowloon station as part of a high-speed rail link to the Mainland.

The rail link will allow passengers to travel from Hong Kong to Shenzhen in seven minutes, and will also connect 16 cities through China, travelling at up to 300kmh.

“A lot of people when they think about it in Hong Kong, it’s the high-speed rail going from Hong Kong to Guangzhou,” Whitwam says. “This is not just Hong Kong linking with Guangzhou. It’s Hong Kong linking with the rest of China.”

Under the co-location arrangement, Mainland China would lease part of West Kowloon station from Hong Kong, and have up to 500 customs, immigration and quarantine staff based there.

The arrangements would mean passengers were technically in China when they boarded the train, even though they were still geographically in Hong Kong.

Whitwam describes it as “one station, two systems”. Mainland staff would not be allowed to leave their area of the station. “There is no accommodation. They would have to go back to China at night.”

Regardless of any controversy, Whitwam says: “It will be solved. This train has to start operating this time next year.”

2030+

2030+ is a plan for Hong Kong’s long-term infrastructure and logistics. It includes a third runway for the airport; a northern economic belt; an eastern knowledge and technology corridor in the “buffer zone” between Hong Kong and Shenzhen. There are also plans for a new city in the harbour, the East Lantau Metropolis (ELM), using reclaimed land.

“This is going to happen over the next 20 to 30 years,” Whitwam says. “There’s a lot of opportunity in Hong Kong during this process.”

Work is already underway on the Tuen Mun to Chek Lap Kok tunnel, which involves tunnelling under the sea bed. The machine being used is so large it has a clinic inside it with a bariatric chamber to treat workers suffering the bends.

The Belt and Road Initiative

When he visited New Zealand in March, Chinese Premier Li Keqiang signed a memorandum of understanding with New Zealand on the Belt and Road Initiative.

But Whitwam points out New Zealand is missing from official maps of the initiative, which consists of the overland “Silk Road Economic Belt” and a maritime route. 

“The Belt and Road is not going to come to us. We have to come to the Belt and Road.”

Hong Kong is branding itself as a service centre for the initiative, he says. “Actually it’s just rebranding itself. It’s always been connecting itself between here and there.”

Belt and Road development has been taking place for years, Whitwam says. And Hong Kong companies are already involved in offshore infrastructure projects; for instance, Hong Kong’s MTR built the Melbourne Metro Rail and the Stockholm Metro.

Hong Kong is holding a Belt and Road Summit on 11 September 2017.

The Greater Bay Area

One of Beijing’s priorities is the Greater Bay Area project, aimed at integrating 11 cities in the Pearl River Delta to boost regional development.

The plan includes the US$10 billion (NZ$13.8 billion) Hong Kong-Zhuhai-Macau Bridge, which is being jointly funded by China and Hong Kong and is nearly complete.

Whitwam says it’s unknown what will happen in 2047, when the “one country, two systems” framework is due to end. Regardless, Hong Kong is expanding and will continue to be important to New Zealand business.

“2030+ is coming. The bay area is here and is going to be developed further and the Belt and Road is here and is going to be developed.

“There’s going to be a lot of change over the next 20 to 30 years and the opportunity is there.”

David Whitwam is Chairman of the New Zealand Chamber of Commerce in Hong Kong. With a banking background, he is a director of a firm advising clients on bilateral trade and investment between the Hong Kong/China region and New Zealand. He currently represents New Zealand on the Hong Kong Government’s International Business Committee and has previously been a member of Victoria University’s IMBA Hong Kong advisory board and contributor to programmes run by the executive education faculty of the London Business School. He holds a postgraduate qualification in business administration from the University of Leicester in the United Kingdom.

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28 August 2017