Hong Kong’s shoebox housing is a disgrace John Lee must end

The chief executive should set a bold target of eradicating the long-time problem of subdivided flats and cage homes by 2032
What he needs is to take a whole-of-government approach to resolving the issue, as Xi Jinping did to tackle poverty

Wang Xiangwei

Published: 5:30am, 2 Oct 2023

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What can Hong Kong do to get its mojo back? That is the question on everyone’s lips, particularly as the city’s international comeback has so far fallen short of the assertion that Chief Executive John Lee Ka-chiu made late last year when the city was close to reopening – “Hong Kong always bounces back, better than ever”.

It is true that the subsequent blitz to woo tourists and business talent has worked to some extent. Visitor arrivals in August reached 4.1 million, or 84 per cent of pre-pandemic levels for that month.

But pessimism looms over the city’s future, particularly among international businesses and investors in the wake of the 2019 unrest and the 2020 imposition of the national security law, whose broad scope has raised genuine concerns about the erosion of Hong Kong’s judiciary independence.

The city’s home prices fell for the fourth straight month in August, about 15 per cent down from a peak in September 2021.

The average daily trading turnover on Hong Kong’s stock exchange has remained just over HK$100 billion. On September 27, the total trading turnover even fell below HK$80 billion.

The Hong Kong government is under mounting pressure to remove property market curbs to stop the rot and has set up a task force to review stock market liquidity.

Tourists take photos in front of the Hong Kong Island skyline ahead of an approaching storm on September 1. The government’s free air tickets and other measures to woo tourists have been effective to some extent, but short-term solutions are not enough to restore confidence. Photo: EPA-EFE

But working on short-term solutions is not enough to restore confidence and enhance Hong Kong’s appeal as a global financial centre. As Lee puts the finishing touches on his much-heralded policy address later this month, he must be bold and creative in drawing up an action plan to bring back Hong Kong’s can-do spirit and get people excited again about this great city.

First and foremost, he must display the determination and courage to fix the housing problem, a major source of discontent in the city boasting the least affordable homes in the world.

Soon after I first came to Hong Kong in 1993, I read about the “cage homes” where the poor and downtrodden slept in bunk beds surrounded by wire cages.

Life in Hong Kong’s worst living spaces: from cage homes to subdivided flats

Three decades later, these homes still exist, but are now called “bedspace apartments”, and licensed by the government. There are an estimated 5,000 “cage” residents, down from 53,200 in 2007. But more broadly, 220,000 people still live in cramped conditions, in subdivided units.

In these 30 years, I have read so many reports about the city’s political and business elite lamenting the lack of easy solutions. Ironically, although some of these individuals have been looking to Beijing for guidance in the past few years, they have failed to learn anything meaningful.

In fact, to resolve the housing crisis, Hong Kong can and should learn from Beijing.

In 2015, when President Xi Jinping vowed the mainland would eradicate absolute poverty by the end of 2020, about 70 million people lived under the poverty line. As Xi took personal responsibility for the project, hundreds of thousands were mobilised to speak to impoverished households across the country, and start files detailing their needs and how to help them.

In February 2021, Xi announced a sweeping victory, with 98.99 million people lifted out of absolute poverty after eight years.

In contrast, I bet the Hong Kong government doesn’t have an accurate tally of the numbers of people living in cage homes and subdivided flats around the city, let alone their needs and the causes of their hardship.

Xi has urged Hong Kong to solve the housing problem and Xia Baolong, the top official in charge of Hong Kong, even challenged the city to get rid of cage homes and subdivided flats by 2049. But Hong Kong can’t really afford to wait that long.

Is Lee bold enough to bring that deadline forward to 2032, or the end of his prospective second term?

10:08

Hong Kong has until 2049 to fix its housing crisis, but is it possible?

That means that Lee must take up the reins personally, adopt a whole-of-government approach, and draw up not only a new housing policy but also a holistic plan to help the city’s poor and downtrodden. It will be a tough fight but not impossible, with the full support of the Hong Kong public and the central government.

Of course, there will be people loudly decrying how a drastic rise in public housing supply might impact private home prices. This kind of argument is tired and hollow. In Singapore, over 80 per cent of people live in high-rise blocks developed and managed by the government’s Housing & Development Board. That has not depressed private home prices in the island state (the influx of immigrants probably helps).

Equally important, Hong Kong must do more to explain the beauty of “two systems” to the outside world, including even Beijing, so as to robustly defend the city’s autonomy and freedoms. The city must do a better job of using its influence on Beijing and lobbying the central government to rethink the policies which directly impact Hong Kong.

For instance, in this space in June, I wrote about how exit bans are hurting China’s efforts to welcome foreign business.

Many of the people who have been banned from leaving the mainland because of a business dispute or connection with individuals under investigation are from Hong Kong. The latest example is Charles Wang Zhonghe, a Hong Kong-based senior banker at Nomura, a Japanese firm.

So far Hong Kong officials seem to believe their hands are tied under “one country, two systems”. But that does not mean there is nothing they can do. In fact, they can be proactive in using their connections so mainland officials may fully understand the dangers of such arbitrary enforcement of laws – which looks bad not only for the mainland but also for Hong Kong.

Wang Xiangwei is a former editor-in-chief of the South China Morning Post. He now teaches journalism at Baptist University