03 July 2015
With the rejection by the legislature of the proposed election reform plan, Hong Kong faces a prolonged period of political stalemate and economic uncertainty. Yet even without this political blow-up, last year’s Umbrella Revolution was already a clear manifestation of people’s long-standing discontent with what they perceive as an unresponsive and unrepresentative government, which they blame for several economic and social “fault lines” that have deeply affected their livelihoods.
Such fault lines stem from chronic income stagnation and growing inequality, the soaring cost of living driven by ever-rising housing prices, and depressing employment prospects for the young, especially those without university educations. According to the Census and Statistics Department, the real wage index for non-professional and non-managerial employees has been on a downward trend for several years. Meanwhile, the city’s Gini coefficient has climbed to a record high, from 0.518 in 1996 to 0.537 last year. Likewise, housing prices are severely unaffordable.
In a startling report last August, Trigger Trend, a research firm based in Guangzhou, contended that Hong Kong was “losing its edge as a global financial and commercial centre, and the territory’s economic clout will be overshadowed by China’s major cities by 2022”. This eroding competitiveness is a result of government inaction as well as rapid economic progress on the mainland. The fault lines originate from the government’s fiscal dependence on high land prices through alleged collusion with property developers, which have sent prices skyrocketing. The “Crony Capitalism Index”, constructed by The Economist, which measures the extent of business tycoons’ wealth profiting from a close relationship with government officials, placed Hong Kong at the very top last year.
… Philipp Martin Dingeldey and Wan Tin Wai are recent MSc graduates from the S. Rajaratnam School of International Studies, Nanyang Technological University in Singapore. Professor Friedrich Wu, from the same school, supervised the research and writing of the article
CMS / GPO / Online
Last updated on 16/11/2015