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OF TEE EFFECTS OF EON{G KOI{G'S RTVERSIOI{ TO SEINA

IIPON Tffi TEERRITORY'S URSAN REDEVELOPMENT PI-AN$II{G

BY

KIN SHIÌ{G LEE

.å. Thesis submitted to the Faculfy of G¡aduate Studies of the Universify of Manitoba in partial fuIfillment of the requirennents fo¡ the degree of

HASTER OF CITY PI^ANNING

@ 1993

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The author tese¡r/es other publications rights, and neither the thesis nor exteruive extracts from it may be printed or othenrise reproduced without the autho/s permission To Mo¡n and rny God

"Get wisdom, get undenstanding; do ¡rot forget my words or svyerve from them. Elo not forsake wisdorn, and she will pnotect you; love her, and she will watch over you." Froverbs 4: 5-6 I Ïærety decl¡re tj¡åÎI am tls sole authnr of tÌ¡is thesis. I auth¡nse tÌæ Uruversi$r of TvÏaniþba h lend üris theeis b ottær i¡sbtutions or natinduslç for t}e puposes of schohrly æseaJch.

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ülher means, in tnhl or Ín pafi, at thÊ reqrrÊst of ûtÌ¡Êr Íffititutions or indir¡idual: far the Fr¡ryrar of schoiarly æsea¡ch.

Kin Shing Lee .4hstract

Hong Kong is facing an historical change in 7997. China's take-over of Hong Kong's sovereignty will change Hong Kong's future, and everything will be done under the shadow of China including Hong Kong's urban redevelopment.

In fact, Hong Kong has to undertake intensive urban restructuring to upgrade the living conditions of its residents as well as to increase its competitive power by introducing a more efficient arrangement of land use and transportation in its urban areas. In the past, urban renewal was effected inefficiently and unfairly to the affected tenants. Future urban redevelopment has to be mindful of the special socio-economic conditions and the development trend applying to Hong Kong, as well as avoiding past mistakes that happened both in Hong Kong and other countries. Public-private partnership in redeveloping the older areas of Hong Kong will likely prevail.

However, the single factor that constitutes the most uncertainty to Hong Kong's future urban redevelopment is the'China" factor. Throughout Hong Kong's history, redevelopment was administered through a capitalist system. Planners have to prepare themselves for the penetration of communism into planning. To what extent communism will affect Hong Kong depends on the ruling philosophy of the Chinese political leaders. The new international and economic order will surely have an impact on China and it is believed that China's policies towards Hong Kong will be looser than towards the other cities in China because maintaining Hong Kong's status quo will be beneficial to China's economic development. However, one certainty is that Hong Kong's development must be congruent with China's national goals and regional development strategies, not to mention the other objectives it has to achieve, such as increasing Hong Kong's comparative advantages in world trade.

As a result of differences in development, housing conditions and the size of the private sector, the integration of China's and Hong Kong's approaches to redevelopment may prove problematical. Though the two places could exchange their experience in urban redevelopment, it is advisable for them to lead their own redevelopment paths untilthe economies and societies of the two places become more comparable.

In an uncertain time like this, planners have to be more political and be more strategic in their planning. Establishing communication networks with government officials of China will help planners obtain more autonomy in carrying out their plans. Moreover, incremental planning, shown to be better for handling changes and uncertain situations, is recommended for future planning practices. .4,cle¡rowledgment

I would like to express my sincere and profound gratitude to the people who have contributed to my ability to complete this thesis, some by academic consultation, others by friendship, warmth and support. These included:

My family, who morally and materially supported me.

Prof Basil Rotofl my advisor, for being a very accessible support and a source of inexhaustible ideas.

Prof. Christine McKee and Dr. Daniel Todd, for their guidance and continuing interest as members of my thesis committee, and Prof. Geof Bargh, for taking over Prof Christine McKee's post while she was sick.

Ms. Cathy Reimer, who kindly edited my thesis.

Mr. Shum Kwan, Housing Manager of the Hong Kong Housing Department, Mr. Lawrence Poon, Development Manager of the Hong Kong Housing Society, Ms. Holly M.M. Lau, Public Relations Manager of the Land Development Corporation, and District Board members, Mr. Wong Kam Tse, Mr. Yip Kam Chiu and Mr. Chan Kok Ming, for their help and cooperation in supplying information about Hong Kong's housing policies and their views on future urban redevelopment.

Bernard Loi, Patrick Wong and Thomas Kwan, for their generosity of providing computer facilities and advice, and all friends who gave me encouragement and support during my past years in the masters program.

Last, but not least, I would like to thank the Almighty God. Without His comfort, I would not have been able to finish this thesis. T'able ofl Content

.AcE

,4,bstn'act ii

Chapter One: lrntroduction

Chapten T'wo: Social and Ecor¡om¡ic CondÍtio¡ls of l{ong Komg 7

A. An Overview 8 B. Economy 9 C. Land and Housing l5 D. Politics 18

Conclusion 21

chapter Three: The Flanning structure a¡rd Mega-Projects of Hong Kong

A. Hong Kong's Planning Structure 24 B. Mega-Projects of Hong Kong 3l

Conclusion 38

ctaapter Four: Urhan Redeveloprner¡t and the Fast Urhan Renewatr Experience of Hong Kong

Section 1: World Urban Redevelopment A. Historical Overview 40 B. General Trends of World Urban Redevelopment 46

Section 2: History of Urban Redevelopment in Hong Kong A. Historical Background 48 B. Urban Redevelopment in the Non-Public Housing Areas 56 C. Urban Redevelopment in Public Housing A-reas 62 D. The Transformation of Urban Redevelopment Approaches 68

lll E. An Evaluation of Past Urban Redevelopment Efforts 70

Conclusion 72

chapter Five: chima's Flanning systern, coastal Ðeveloprnent strategy ar¡d Urban Redeveloprnent Fractices in Major Chinese Cities

Section l. An Overview of China's Planning and Housing Policies A. China's Administrative System 76 B. China's Regional Development Strategy 78 C. China's Planning System 79 D. China's Housing and Urban Redevelopment Strategies l. Housing condition and housing policies of China 84 2. Urban redevelopment of China 87 a. Beijing's urban redevelopment 89 b. Shanghai's urban redevelopment 91 c. Guangzhou's urban redevelopment 93

Section 2: Effects of China's Coastal Development Strategy 97 A. The Effects of the CoastalDevelopment Strategy on Guangdong 99

Conclusion 102

Chapter Six: Hong Kong at the Crossroads

Section 1: Hong Kong's Relationship with Guangdong 106

Section 2: The Differences between the Urban Redevelopment Approaches of Hong Kong and China 108

Section 3: Scenario Construction A. Causes for People's Belief in an Optimistic Future for Hong Kong 112 B. Causes for Feople's Belief in a Pessmistic Future for Hong Kong tt7 C. Scenarios of Hong Kong's Future 120

Conclusion t34

Chapten Seven: T'he Challenges f'or l{omg Kong Fla¡¡ner.s

A. Hong Kong's Urban Redevelopment Tasks 136

1V B. Regional Co-Operation 138 c. Planners' Strategies in Handling Future politicaluncertainties 141

Conclusion 147

Cfaapter Eight: Concl¡¡sioxl 148

Appendix 151 tsibliography t54 {,ist of Figures:

Figure 1. Hong Kong's Position in the East Pacific Ocean l0

Figure 2: Hong Kong's Position in Relation to China l1

Figure 3: Proposed Planning Preparation Process 30

Figure 4: Map of Hong Kong 33

Figure 5: Planned Future Reclamation of Hong Kong 35

Figure 6: Principal Transport Network 1991 and Z00I 36

Figure 7: Principal Transport Network 2011 37

Figure 8: Land Reclamation in the Urban Areas of Hong Kong 49

Figure 9: Districts of Urban Hong Kong 52

Figure 10a: Floor Plan of a Seven-Storey Mark I Building 54

Figure l0b: Areal View of a Seven-Storey Mark I Building 54

Figure 11: Urban Redevelopment Areas of Hong Kong 59

Figure 12a: A Proposed Clearance Project by the LDC 63

Figure 12b: A Site for Infill by the LDC 63

Figure l3a: The Demolition of Old Mark I Building in Kwun Tong, Kowloon 66

Figure 13b: New Public Housings were Built on Redeveloped Site 66 Figure 14: Current Structure of Planning Administration in China gz

Figure 15: Map of Guangdong 94

Figure l6: Hong Kong's Location in Relation to Baoan County 140

vl Chapter tne: lntnoduction

Hong Kong is a place of constant change. In fact, Hong Kong people have never experienced a true sense of stability. During the early post-war development of

Hong Kong in the late 1940's and 1950's, people who moved into the colony from China only saw it as a temporary place to stay. They were all planning to return to China once the political system there had stabilized. Even the British Government at that time was not sure about the colony's future, eschewing long-term planning for Hong Kong and governing mainly on a day-to-day basis. The riots which occurred cluring 1966 and 1967 greatly diminished the confidence both of the Hong Kong people and the Hong Kong

Government.

A more stable period came in the i970's and early 1980's. The new generation born in Hong Kong began to view it as their home and worked very hard to build a better future. However, the issue of the Chinese take-over of Hong Kong in 1997 shook their confidence again in September 1983. Hong Kong seemed to revert to the early days ofuncertainty. The new generation faced again the fear that their parents had faced, though of a different magnitude and in a different way. WillHong Kong still be prosperous, and will Hong Kong's future political and social environments be the same under the guarantees of the People's Republic of China? These are questions that puzzle many Hong Kong people.

The Chinese Government's intention to take over Hong Kong in 1997 coincides with the Hong Kong Government's plan to reconstruct the urban areas of the territory in order to correct some of the old problems, to prepare Hong Kong for a challenging tomorrow, and to better equip it to rank higher among world-class cities.

Continued urban redevelopment, which is viewed as a symbol of continual progress and prosperity, could also work to strengthen the confidence of Hong Kong people. In the

past, Hong Kong made mistakes in urban redevelopment, and so did cities in western

countries. Lessons from these places could be learnt in Hong Kong's pursuit of future

urban redevelopment methods. At the same time, the examination of the special

economic, social and political conditions of Hong Kong will give directions to Hong

Kong's future urban redevelopment approaches.

However, Hong Kong planners cannot formulate planning strategies in a

linear fashion by extrapolating the colony's present demographic, social and economic

trends. Instead, planners have to take the 'China factor' into account, including China's

urban strategies, the nature of urban redevelopment projects taking place in the Chinese

cities, the relationship between the state and the coastal provinces in China, and Hong

Kong's relationship with the province of Guangdong. As a consequence of the change of

jurisdictional responsibility from the British Government to the Chinese Government,

Hong Kong will be, to a certain extent, subject to the influence of the Chinese Authority.

It is realized that planning could not be done in the vacuum of political factors. planners

have to sort out ways that could accommodate what they think is good technically and

socially and render them compatible with the political situation of the time. An

understanding of the planning system of China and its inter-provincial relationships could

make planners aware of the possible changes in store for Hong Kong, not to mention the people that Hong Kong planners could turn to for help and support. In order to envisage the possible future of Hong Kong, examining and developing scenarios of the future developments in Hong Kong's society willbe helpful for planners devising proper strategies to manage future uncertainties. Accordingly, the purpose of this thesis is to develop different scenarios which project Hong Kong's future urban redevelopment approaches under different probable or possible political, social and economic situations and to anticipate the role of the planners. There are th¡ee sections to this thesis. The first will deal with the political,

social and economic situation of Hong Kong and the lessons that Hong Kong has learnt

from past urban redevelopment occurring both in Hong Kong and abroad. The second

will deal with the'China factor', that is, those policies of urban development in the people's

Republic of China, particularly the Guangdong province, which will impinge on Hong

Kong's urban redevelopment after 1997. The third will be an analysis of the possible

political and social situations that confront the Hong Kong planners. Planning strategies

and redevelopment approaches will be suggested for different anticipated political

situations.

In order to have a better understanding ofthe evolution ofurban

redevelopment and the past redevelopment efforts of Hong Kong, the author has

examined urban redevelopment programs both in the major cities of the world and Hong

Kong itself. The lessons of urban redevelopment derived from this research were

evaluated by identifying the weaknesses and strengths of each approach and comparing the

development stages and the socio-economic conditions of these countries with those of

Hong Kong. The approaches that suit Hong Kong's situation \ /ere recommended. In

addition, documents containing Hong Kong's planning policies and anecdotal data of

Hong Kong's urban area were also collected and analysed in order to both reveal future

planning trends and to form an overall picture of Hong Kong's environment. Of course,

the most important factor, the one that constitutes the greatest uncertainty in 1997, is the

political environment, planning structure and urban redevelopment approaches of China.

Therefore, a considerable amount of research was devoted to this area to shed light on the

possible effects of China's development on Hong Kong's future. Strategies to dealwith

Hong Kong's future unceñainty were also suggested according to the politicai practices

and planning tradition of China. Moreover, interviews with key planning professionals and community leaders were undertaken in order to gather their views on future urban

redevelopment and site investigation was conducted to understand the actual urban

housing problems.

The thesis has been organized as follows

Chapter One. Introduction

The chapter will discuss the recent development in Hong Kong's social, economic and

political climate. It covers the opportunities and constraints for future economic growth,

social trends and people's life-styles. The object is to see how urban redevelopment can

match the needs and trends of Hong Kong society.

Chapter Three. The Planning Structure of Hong Kong

This chapter deals with Hong Kong's present planning system and mega-projects. The

chapter will briefly describe the changes taking place within the planning system of Hong

Kong and see how these may affect Hong Kong's future urban redevelopment.

Chapter Four: Survey of Urban Redevelopment and the Hong Kong Experience

There are two sections in this chapter. The first section will be a historical approach to

understanding the urban redevelopment trend in countries that have a long history of urban redevelopment. It has been noted that the role of government in urban redevelopment has been changing from direct intervention to partnership with private developers. Coinciding with this is the view that public participation is being encouraged in the planning process, and redevelopment direction has been changeci from sium clearance to urban regeneration. It is believed that experience of urban revitalization in other countries could provide lessons for Hong Kong's future urban redevelopment.

Section two will discuss Hong Kong's urban redevelopment history. The aim of this

section is to give a general picture of the efforts that Hong Kong has made in this area. In the meantime, the strengths and weaknesses of past urban redevelopment in Hong Kong will be identified.

Redevelopment Practices in Major Chinese Cities

China's planning system, regional development strategy, housing policy and redevelopment practices in major cities will be studied and the effects of the coastal development strategy on Guangdong will be analyzed to serve as a basis for discussion in chapter six.

Chapter Six: Hong Kong at the Crossroads

There are three sections in this chapter. Section one will examine the socio-economic ties of Hong Kong with its neighbour. Section two will discuss the differences between Hong

Kong and China that would affect their choices of redevelopment approaches. Section th¡ee is an analysis of the society of Hong Kong under different possible political situations. Two scenarios will be constructed based on people's optimistic and pessimistic views towards Hong Kong's future. It is expected that discussion in this chapter will help planners understand the possible political situations that they have to face.

Chapter Seven: the Challenges for Hong Kong Planners

This chapter consists of three sections. The first section will outline the urban redevelopment tasks of the planners, the second section will discuss planning and redevelopment of Hong Kong from a regional perspective and the last section will discuss the strategies that could help planners handle future uncertainties. Chapter Eieht: Conclusion

This chapter will wrap up the discussion and summarize Hong Kong's future redevelopment methods, while delimiting the issues that developers have to take into account when carrying out their development projects. chapten T'wo: social ar¡d Economic cor¡ditio¡es of l{ong Koreg

'So as these situations I conflicûng objectives in dynamic circumstances ] change, rve

need to ask ourselves const^antly u,hether our decisions of yesterday are still valid. It is a

wise Government which recognizes changing circumsLances and adapts poliry

accordingly while remaining true to its underlying philosophy., - - Sir Bremridge, the

Financial Secretary of Hong Kong.

It has been said that the transformation of Hong Kong from a fishing

village to a world-class financial centre is nothing but a fairy tale because of the persistent

uncertainty hampering the colony's existence. Many people worry about what Hong Kong

will be afr.er 1997, but no one knows what will actually happen. Hong Kong has proved

in the past that it could address seemingly unthinkable issues. Looking at Hong Kong's

future urban redevelopment, it seems that the prospect is overcast as a result of the

anticipated take-over of Hong Kong by China in 1997. Perhaps it is time for us to

evaluate urban redevelopment and think about how Hong Kong can carry out the best

urban redevelopment under the rule of the Special Administrative Region.

Basically, the future urban redevelopment of Hong Kong is controlled by three major factors. The first facto¡ is the internal factor of Hong Kong's socio-economic situation, political development and pìan ring tradition. The study of these is important because urban redevelopment has to comply with the needs of the targeted community.

The second factor is the lessons that planners learn from past urban redevelopment in the world , China and Hong Kong, and the third factor is the Hong Kong-China relationship.

As a part of Mainland China aft.er 1997, China has a direct effect on Hong Kong's future; iherefore, it stancis to reason that what Flong Kong cioes between now and the end of the 8

transitional period will be done in the shadow of the People's Republic of Chinal. Though

China is still a socialist country, there are ongoing economic reforms in China.

Concomitant to these reforms, China is more open to outside ideas and there seems to be

a relaxation of political control of the Central Government towards the coastal provinces.

The market mechanism is allowed greater play and businessmen are free to manage their

own businesses. The society in many cities of Guangdong are facing rapid changes and

there is a new relationship developing between the province of Guangdong and the Central Government.

However, the planning system of Hong Kong, the'China factor'and past

urban redevelopment experiences will be put aside for later discussion. In this chapter, we

will first focus on socio-economic conditions of Hong Kong and then consider what their

bearing will be on future redevelopment approaches.

,4,.,4n tverview

Hong Kong is one of the fastest-growing newly-industrialized economies in the Far East. Its main urban area lies astride the two shores of the Victoria Harbour.

Since its early days, Hong Kong has been a f¡ee port. There is no barrier to the flow of goods and services. Because of two of its most valuable assets, the harbour and the people who are a highly disciplined and hard-working labour force, Hong Kong has been transformed into the world's third most important financial centre, after New york and

London. However, the problem of 1997 overshadows Hong Kong's future. With the signing of the Sino-British Joint Declaration on December 19th, i984 in Beijing, it was agreed that Hong Kong's sovereignty would be handed over to the Chinese Government lThis thesis does not take into account the recent reform initiatives of the Government of Hong Kong proposed by Governor Ch¡is Patten wfuch have so displeased the Mainland Government in 1997. Hong Kong will then become a Special Administrative Region (SAR) of China

and would enjoy a fifty-year transitional period of no significant change to its present

social, economic and political status. This is what the Government of China calls the innovative'one country, two systems'policy. The Government of China's attitude towards taking over the sovereignty of Hong Kong is steadfast and the fear of communist rule has already overwhelmed some investors. Though the number of emigrants from

Hong Kong to other countries has sþrocketed and economic growth has slowed down, different people hold different views on the future of Hong Kong. We will see how these changes will affect urban redevelopment policies in the critical years leading up to 1997 in the following discussion.

ts. Economy

The Korean War of 1950-1953 was the primary cause of Hong Kong's moves towards industrialization. After almost 40 years of earnest efforts, Hong Kong has not only attained a living standard comparable to modestly-developed areas of Europe, but has also been one of the top fifteen leading exporting places since the late 1960's. In

1984, the totalvalue of Hong Kong's exports per capita stood at US 95,297, more than three times the British average and roughly quadruple the Japanes e average.2 In terms of real Gross Domestic Product (GDP), for the thirty-five years between 1949 and 1985, the

GDP of Hong Kong has increased seventeen-fold.

Hong Kong's economic success did not come by chance. The Hong Kong

Government's early laissez faire3 policy and , later, the positive non-intervention policya,

2Ho, Yiu-ping, 'Hong Kong's Trade and Industry: Changing Patterns and Prospects', in'Hong Kong in Transition', edited by cheng, Joseph Y.s., o:dorci universib' Press, Hong Kong. 1986, p.166. 3laissez faire refers to the belief that a 'free' market with an uruestrained profit motive ii the best way of ensuring economic prosperit-v. l0

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Figure 1: Hong Kong's position in the East pacific Ocean aPositive non-intervention policy: It can also be understood as the minimum intervention policy. The government which implements this policy will not intervene actively in the economy e*ceþt to supply business information and promote t¡ade abroad. il

lV' ^*r{'-t--*-^rl\) t\----.-...--- '-\'------rr-'î'H¡QB^¡. ;J K BEUN. \ "ç1)¿r-{^< ,) I { cHrNA åi:^. 1'.- \ ; 'q,ñ¿/ i^:r-. *.^".\.""'"' .i oô tì)ro-- cHFNGJ)L,5 };'r*^crur -ô^ì-''^\ -.ê-,, I l{çryI-c î í''-.h. -) ,/ ocEAN \ urr^N(i¿H.Lr -{ f'It"u'' {.^/t*^r ÍrJ Vr/u\\;À\ t2

contributed much to the attraction of foreign investment. There are no tariffs, no controls on capital movement and labour unions are comparatively weak in Hong Kong. AII these factors help to decrease the production cost and raise Hong Kong's competitive power in

bringing in foreign investment. Hong Kong is also a dynamic society willing to change

with circumstances. Generally speaking, the Hong Kong economy has experienced

several periods of economic restructuring. The first economic restructuring began with

the uN embargo on china in the 1950's. The incident hastened Hong Kong's

industrialization. The second one occurïed in the 1970's and 1980's when Hong Kong

started to restructure towards an economy based more on tertiary production, and now

Hong Kong is striving to develop high-technology activities in order to avoid direct

competition with the other Asian countries for labour-intensive assembling industries.

In the time span of three decades, Hong Kong has attained a world-class

reputation. However, although Hong Kong's success could be ascribed largely to the hard

work of its people, the close relationship between Hong Kong and China should not be

overlooked. China is the hinterland of Hong Kong. It is Hong Kong's source of food,

water and energy. Undoubtedly, the overall living cost of Hong Kong would have risen without the cheap and reliable food supplies imported from China China also depends on

Hong Kong to establish trading relationship with other countries and to import high- technology products for its modernization. As a result of this close trading relationship,

China obtained 70%o of its foreign investment via Hong Kong.

Despite past success, Hong Kong's economy is now facing a great challenge. First of all, protectionism and the terms imposed on the colony by the General

Agreement on Tariffs and Trade (GATT) have crippled the competitive power of Hong

Kong products. By 1984, about 85% of Hong Kong's export of textiles and clothing were l3

subject to some form of restraint, compared with only 10%o in 1961 5. Moreover, Hong

Kong's economy is being adversely affected by the worldwide economic recession. Secondly, land prices in Hong Kong are extremely high rent per unit area is the second highest in the world after Toþo. According to Mary Lee, in 1982, the cost of land in Tai Po Industrial Estate was about twenty times higher than the equivalent in Taiwan6. This

weakens Hong Kong's position in relation to the other newly-industrialized countries

CNICÐ in Asia. The problem is more acute if we consider that other countries have invested heavily in high-technology research and production while Hong Kong still relies

on light, mature-technology industries, soon to be supplanted by other Asian developing

countries where production costs are much lower. Yet, the single factor that affects Hong

Kong most is the con-fidence problem caused by the 7997 change. Foreign investment is

deterred by the unstable political environment. The inflation rate is severe. In the annual executive report ofthe Governor, i990, it was stated that the average inflation rate for the

year reached 9.5%. The high inflation rate imposes limits on wage increases, while

exports for that year rose only lo/o. To balance the slow growth of foreign investment in

the territory, the Chinese Government has already invested more than US$ l0 billion in

Hong Kong's economyT. The Chinese Government hopes that through investment in

Hong Kong's various economic activities it will exert sufücient influence to prepare for

the advent of 1997. On the other hand, it will also serve to balance the outflow of foreign investment from Hong Kong. In fact, there is an inextricable relationship between Hong

Kong and China. On China's side, Hong Kong is the largest market for Chinese products.

In 1984, the total amount of imports from china was us s6,77g.4 million, which accounted for 27.7 %o of CLttna's total merchandise sales abroad. On the other hand, as mentioned above, Hong Kong depends on China for its supply of foodstuffand fresh sHo, Yiu-ping, 'Hong Kong's Trade and Industry: Changing Patterns and prospects,, in ,Hong Kong in Transition', edited by cheng, Joseph y.s., oxford universiry press, i9g6, p.lg6. t3t, 'Left High and Dry', Far Eastern Economic Review, Oct., t9g2, p.97 Í!:.,tKraar, Louis, 'A new china without border', Fortune, october 5, 1992, p.r25. t4

water. It is generally hoped that the two will maintain the present trading relationship, so that China would obtain necessary capital for its four moderni zationprograms8 and Hong Kong would continue to receive supplies from China of its raw materials and foodstuffs. The working relationship between the two places has so far remained good. However, as the relationship of the two places becomes closer with the impending political unity, a

con-fidence problem arises on the part of the investors. Some of the comparative

advantages of Hong Kong have been lost. Many electronics factories have moved to

Singapore, and Singapore has surpassed Hong Kong in the volume of foreign-exchange

transactionse. In fact, the growth of Hong Kong is sustained by the increase of China

trade and investment rather than by investment from abroad. The future growth of Hong Kong depends on quite a number of factors. Among these, China's attitude in regards to

Hong Kong is of paramount importance. Whether it sticks to its promises to keep Hong Kong open, or whether it would be ready to forgo economic gain for the sake of politics is decisive. Because of the political uncertainty, the anticipated rate of growth in the years leading to 1997 ranges from 6-9%o estimated by the optimists to 3-60/o estimated by the

realistsr0. However, it is also anticipated by realists that Hong Kong will be different from

China in at least four crucial respects.

I it will continue to rely on private ownership rights as a key principle of social organization;

2. the market will remain the ultimate arbiter of value in Hong Kong;

3. the Hong Kong economy will be far more open than its mainland counterpart,

4. the communist Party will operate as a'shadow'governmsn¡.r1

8'Fou¡ Modernizations' are the modernization of Defence, Agriculture, Science a¡d Technology and Industry. eThe Daily Neu's (Hong Kong), lgth Ma¡ch, 1990, p.6 lochung, Lai Wai, Lawrence, 'The Rule of Tv.,o Third: The optimal public Building and Construction Expendifure in Hong Kong in the PADS Age', Plaruring arrd Development, Vol.6, No.l, 1990, pp.7g-79. l lMushkat, Minon, 'The Economic Future;f Hong Kong', GSIS Månograph Series in World Affairs, The university pubrishers, of Denver, Lynne Reinner Inc.. Hòng Kong univãrrity pr.rr, 1990, p.l3g. l5

C. I-and and X{ousing

The present population of Hong Kong is about 5 8 million. It is projected

that the rate of increase will remain low in future years, at about 0.6yor2. The population

growth rate is stable and no large-scale illegal immigration from China is expected

because the Immigration Department abandoned the'touch base'policyl3 in 19g0 and the

Director of Immigration has the power to repatriate illegal immigrants. However, an

influx of authorized officials from China is expected, although it will represent but a small

percentage of the total population of Hong Kong, and this will probably be balanced by

the out-migration of the young and more educated professionals, and the rich.

There is also a growing need of housing in Hong Kong because the

existing housing condition is crowded and some people even lack permanent shelters. As

estimated in April, 1991, there was a shortage of 158,000 units of housingra. In fact, the

number of households is increasing too. In 1986, the estimated number of households

was 1,491,260. It rose to 7,633,97I in 1990 and was anticipated to reach 1,g27,973 in

199515. The average number of persons in a household is decreasing from 3 jl in 1986 to

3.55 in 1990 and was anticipated to drop to 3 38 in 199516. As the average number of persons in a household drops due to an incresing number of single people living alone and

people's preference for small families, the demand for smaller flat units is increasing The

I2'Hong Kong Population: A 2}-year Projeclion', Hong Kong Census and Statistics Department, Government Printer, Hong Kong, Nov., 1987, p.7. l3'touch ,touch base'poliry was an immigration policy of Hong Kong before 1980. With the base,policy in effect, Mainland Chinese who successfully reached the main urban area of Hong Kong would be flanted the status of permanent resident of Hong Kong. "When 'n-, will Hong Kong's housing be enough?", Realty Report, Vol. 58, No.4, April, 1991. p.19.lt-, "When will Hong Kong's housing be enough?", Realty Report. Vol. 58, No.4, April, 1991, p.20 ló ttrr¡L^- --irr rr^- - rt -- -.t- L I ' wnen wiii rlong içong's nouslng be enough'/", Realqv Report, Vol. 58, No.4. April. 1991. p.20 l6

number of housing units under 70 m2 amounted to 680,325 units, the vacancy rate of flats

in this category was 7 .8o/o in 1989 while the total stock of housing units above 70 m2 was 125,315 units and recorded a higher vacancy rate of 16. o/oti.

In terms of lifestyle, the number of marriages has decreased from 53,410 in 1984 to 37 ,229 in 1990. The reason for this trend is that people would like to be care- free' They prefer co-habitation and not to have children. Moreover, since the economy of Hong Kong took offin the 1950's, Utilitarianismls and Instrumentalismle, which are seen as results of capitalism, have taken root in the society of Hong Kong. people devote most

of their time to discerning ways to make more money. Those who have no confidence in the future of Hong Kong have set their sights on earning as much money as they possibly can before abandoning the territory They are indifferent to social and political matters. This could be ascribed partly to the mindset of the immigranrs to Hong Kong in the 1950's and the value system they transfered to their children. Lau Siu-kai explains the asocial and apolitical phenomenon of Hong Kong people as follows:

' The chinese sociery of Hong Kong is composed largely of immigrants and their

offspring. Motivated primarily by economic aspirations, they are blatantli, utilitarian in

inclinaton and passionately apoliucat or anti-political. Utilitarianism and

Instrumentalism not only influence relationships with outsiders, the government, and

society as a whole but also tend to mould interpersonal relationship u,ithin the family, particularly those whose ties with the 'core, members are not close. or whose t'--., "Property Review 1990", Rating and Valuation Department, Hong Kong Government Printer, Hong Kong, t¿ble L tsutilitarianism is a doct¡ine expressing useñrlness as good and it maintains that the determining consideration should be the usefulness of its consequences.@abcock, philip (ed.),'Webster's Third Nerv International Dictionar¡'of the English Language Unabridged'. Merriam-Webster Inc., Springfield, Mass., 1981) lelnstrumentalism is a concept claiming that the significant factor of a thing is its value as a¡ instrument. (Babcock, (ed.), Philip 'Webster's Third New International Dictionary of thãEnglish Language Unabridged', Merriam-Webster Inc., Springfield, Mass., I 9 g I ) l7

membership is achieved through fictive kinship. Utilitarian familism naturally

forecloses ex'tensive social involvement and political parucipation. chinese socieg, on the whole is inwardJooking and atomistic; it ìs composed of a multitude of family

groups' each of which provides the locus for psychological identification and social interaction. The resourcefirlness of these family groups allows them to meet many of

the mundane needs of the chinese population of Hong Kong. This capacity makes the

political arena relatively non-salient as a channel of need gratification and hence

sustains the separation of policy and society.'20

A survey undertaken by Lau and Kuan reveals that about half of the respondents were opposed to the use of demonstrations, protests, propaganda or sit-ins to pressure the government. These methods are viewed as disorderly behaviour.

Social welfare is also comparatively weak and neglected in Hong Kong in comparison with the situation applying in Western Europe. The government would like to leave the market mechanism alone to distribute resources. Public housing provision, at the very beginning, was for quelling social distress and to stabilize the population because

substandard housing conditions might breed discontent. In recent years, the government

has begun to privatize some of the public services originally provided by it. The conversion of the Housing Authority to a'self- financing' orgaruzation was the first step in the Government's intention to privatize public housing. In order to be selÊcontained, the

Hong Kong Housing Authority has to sell public housing to tenants and vigorously promote the'Home ownership' scheme to generate revenue for its operation.

20Lau, Siu-kai and Kuan, Hsin-chi, 'The Changing Political Culture of Hong Kong Chinese,. in ,Hong Kong in Transition', edifed by cheng, Joseph y.s., oxford university press, t9g6, pp.26-27. t8

In respect of land supply for development, the agreement reached by the Chinese and the British Governments restricts the Hong Kong Government to supplying only 50 hectares of land annually. The supply does not meet Hong Kong,s growing need. The Land Commission then has to resort to some creative ways of defining the fifty hectares of land. Negotiation with the Chinese Government is badly needed in order to

acquire more land for Hong Kong's necessary residential development.

Ð. trolitics

In terms of the political environment, Hong Kong sits on the horns of a dilemma. On one the hand, China's influence on Hong Kong's affairs has increased. Since

there are only four years to 1997, the Chinese Government has to make preparations for taking over the reigns of government. The earnest support of the people of Hong Kong for the student democratic movement in June 1989 caused the Government of China to resolve that it was necessary to prevent Hong Kong from becoming a base for counter- revolutionary movements. Therefore, the Chinese Government has demanded that it be consulted about everything concerning the future of Hong Kong and that no measures are to be implemented without its approval, notwithstanding the fact that the Chinese officials have said on many occasions that China has no desire to exercise a veto prior to 1997 over the operation of Hong Kong on a day-to-day basiszr. In fact, the chinese Government has already exerted its influence on matters such as restricting the nationality high government of officials of Hong Kong and forbidding the unloading of the

"Democratic goddess" statue in a vigil in memory of the June 4th Incident held in Hong Kong, and expressed a strong opposition to the notion of 'the right of abode of Hong Kong residents in Britain'. Cheng said that, though paragraph (3) of the Sino-British Joint

2lcheng, Joseph Y'S., 'Hong Kong in Transition', edited by Cheng, Joseph y.S.. oxford University press, 1986, p.15. 19

Declaration promises that 'the Hong Kong Special Administrative Region will enjoy a high degree of autonomy', the autonomy of Hong Kong would still be restricted no matter how

high a degree it might bszz.

By way of contrast, the Government of Hong Kong is moving towards

democratization with a view to ensuring that the people of Hong Kong will be in charge of their future and will represent their own interest. Changes along these lines u.gun å the early 1980's with the emergence of the District Boards. Though the Boards,authority and power in infuencing the decisions of the government are very limited, and they are relegated to being concerned only with local matters, they represent the first step of Hong Kong's democratization. According to Arnstein's ladder23, the birth of the District Boards is a token of the government to enable the public to consult on public policies at the local level. The general public still have no direct influence on policy formulation. A¡other bolder move of democratizationwas the 1991 direct election of the Legislative

Council. This is a more positive move towards liberalization than the introduction of the District Board to the political arena of Hong Kong. However, the allocation of seats to functional groups still left much to be desired. There is an over-representation of business and industrial groups because of the Hong Kong Government's fear that a dominance by the liberals in the Legislature might harm the amicable relationship of the Governments of Hong Kong and china. However, the liberal leanings of the Hong Kong people are anticipated to rise as civic education has been introduced into the school curriculum and people are exposed more to election activities of the govemment. Certainly, Hong Kong people will expect a society in which they have more autonomy in governing themselves.

zzibio, p. ts 23In Sherry A Arnstein's ladder, there a¡e eight rungs representing the different levels of participato' aciivities; I ' manipulation; 2. therapyr 3. informing; 4. consultatiõn; 5. placant. 6. a partnership; 7. delegation; 8' citizen cont¡ol (Arnstein, participation" s., 'A Ladder of cilrzen J. American Institute of Planners, 1969, pp.2l6-224) 20

In regard to the politicar future of Hong Kong, the optimists, mostly business people who want to establish trade with China, claim that the Chinese Government will probably be flexible in handling Hong Kong affairs. Firstly, it is the Government of China's will to adopt the 'one country, two systems,policy in the Sino- British Joint Declaration which renders Hong Kong a special Administrative Region(SAR) after 1997' The stability and prosperity of Hong Kong seems to be granted high priority on the agenda of the Chinese Government. Secondly, there is a strong link between the economy of china and Hong Kong. About two-thirds (65.7%)of all foreign direct investment, and some 25-30% of all chinese foreign exchange earnings between 1978-1987 came from Hong Kong. In maintaining Hong Kong's stability and prosperity, the chinese will be conforming to the national goals adopted in the Third plenum of the Eleventh Central Committee of the Communist Party in China in Decembe r l97g These goals are the'four modernizations', reunification of the country, and the combat of hegemony internationally. It is obvious that foreign hard currency imported through Hong Kong would benefit the four modernization programs of China and the success of the Hong Kong case would influence the relationships between Taiwan and China over

matters of reunification. Huan Xiangz+ once said that:

'""socialism is a fairly long historical stâge and in this historical stage, there is a

process in which the capitalist qystem and the socialist system co_exist...... In ou¡

country, there a¡e th¡ee tiers of economic forms: the reforming economy, the special

economic economy, and speciar capitarist economy.... Therefore, the design of ,one

æuntry, two systems'has a theoretical base.'25

24Huan xang u'as a¡r advisor to the Hong Kong and Macau Affairs office and a member of the chinese Academy of Social Sciences. 25cheng, Joseph Y.s., 'Hong Kong in Transition', edited by cheng. Joseph y.s., oxford press, 1986, p.10. university 2l

From the statement made by Huan Xiang above, it is understood that socialism would tolerate the co-existence of different economic forms in so far as they would increase socialist productivity and permit Hong Kong to retain its existing economic system. The diversity of economic forms in China serves as a base for the introduction of the'one country, two systems'policy. On top of this, China seems to have a good record of observing international agreements. However, the practice of surprise

and deception26 in Chinese politics constitutes a big threat to Hong Kong's future political environment' In view of this, economic interest and the Chinese Government's desire to remedy its image after the June 4th Incident, it may be assumed that the spirit of ,huliang hurang'27 stated in the Sino-British Joint Declaration could prevail beyond 1997

Conclusion

Hong Kong is known as the Oriental Pearl which is characterized by the flamboyance its of night life. Hitherto Hong Kong has prospered because she coped so

well with past challenges and could adapt readily to changing circumstances. The successful shift from an entrepot to an industrialized place in the 1950's was a good example. In view of all the present changes, Hong Kong should also be adaptable enough to maintain its status as one of the fastest growing newly-industrialized economies in the Far East' This is not only crucial to uphold the present living standard of the Hong Kong people but would help ensure that China will not intervene with the internal affairs of

Hong Kong. The desire of the governments is reflected in the Joint Sino-British Agreement that there will be no significant changes in the social, economic and political structures of Hong Kong. In order to achieve this, a political guarantee from the Chinese

26The practice ofsuprise and deception refers to the Chinese political practice that leaders would not always make very clear or explain what they have in mind uniit the måter matures and y,,ould ccver up news that is detriment¿l to their ,,news,,, rule by controlling the mass media. They also publish true or false, to promote the image of the parry'. 2Thuliang hurang. mutual tolerance and muh¡al concession 22

Government is a crucial necessity so as to give confidence to investors. Also, Hong Kong

has to find ways to increase its international competitive power. There are a number of

tasks confronting the Hong Kong Government in accomplishing this objective. They are:

1. to find ways to combat protectionism;

2. to hasten economic development and to strive for a smooth and faster conversion to an

economy based on high-technology;

3. to find measures to check the rampant increase of land prices; and

4. to find measures to check inflation and keep the inflation rate below 10% so that it

would match the anticipated slower growth of Hong Kong's economy predicted to occur

at abouf 60/o.

Another problem that the Hong Kong Government has to deal with

concerns the problem of emigration and the change of people's life-style. Out-migration

from Hong Kong is severe. The Hong Kong Government and the Government of China

have to work together to provide the necessary political guarantee to detain the migrating

professionals. Increasing the supply of land to meet the demand for dwelling units for

small families is another area that the Hong Kong Government has to explore.

With respect to Hong Kong's urban redevelopment, old industrial areas

may need to be redeveloped to other uses in order to align them with Hong Kong's industrial restructuring As the service and financing sector increasingly come to the forefront of Hong Kong's economy, urban redevelopment has to cater for the need engendered by such a shift. More commercial facilities and offices might be built on the old industrial sites that are to be redeveloped. In addition, as a consequence of mechanization of production, and since people have more leisure time, more open space

-^^-^^+:^-^t ^L ^--t J r- - : r ,7 . arrL¡^-l rçurçdluuil.lr arças^-^^^ slluulu ue- provtoeo ln Ine resloenÌlal argas. 23

However, urban redevelopment has to proceed in concordance with Hong

Kong's economic growth. Preservation, rehabilitation and all sorts of low-cost redevelopment should be considered for areas that are suited for such practices. In addition, the rampant inflation led by the housing prices make the continuation of the redevelopment of the old public housing estates necessary to provide low-cost housing for people who cannot afford private housing.

Last, but not least, the Land Commission limits the annual supply of land to the Hong Kong Government to 50 hectares and compels the government, in consequence, to depend on reclaimed land supplies for renewal for profit making purposes.

After reviewing the economic and political conditions of Hong Kong, the planning structure of both Hong Kong and Hong Kong's mega-projects will be discussed in the next chapter. 24

chapter Thnee: T'he Flanning structune and Mega- Fnojects of'Hong Kong

,4.. Hong Kong's Flannímg Str¡¡cture

Hong Kong's city planning tradition was heavily influenced by the colonial style. For example, the Peak District Reservation Ordinance of 1904 protected the peak area from the penetration of Chinese standards so as to preserve the area exclusively for

'European type houses'. Indeed, many British cultural attitudes and planning traditions are reflected in Hong Kong's current urban form. The garden suburb, the new town, and many of the standards and design guidelines are borrowed from the West. Apart from preserving the colonial characteristics of the territory, planning takes on a conservative fashion because of the existing conflicts among different political players. There should be a balance of interests among the British Government, the People's Republic of China and the Hong Kong Government. Planning tries to accommodate the needs of these three governments as well as the interests of the elite, the bureaucracy and the people. The

Hong Kong Government is reluctant to make any radical planning move to agitate the tension of any party. As Miners says,

' Hong Kong continues to exist onJy because it suits the interests of Britain, China and

its own citizens that this should be so. Any one of these three could initiate or force a

change in the status quo, but each refrains from making any move for fear that the

results would be more detrimental to it than tlre present equilibrium. So long as this

consensus continues, the colony is safe, provided only that it remains able to earn its

living by successful trading in the world's markets; for an economic slump would put its 25

separate existence in jeopardy as surely as any conscious act by Britain, China or its

ou'n populatio¡.'28

Therefore, Hong Kong, until recently, tried to be a'no-party' state and

implemented a positive non-intervention policy, which Bristow says, 'was detrimental to

land-use planning which carries both intervention and goal achievement as two of its

hallmarks'.2e

Besides, planning in Hong Kong has always been of a piecemeal and

incremental nature. The lack of resources also impedes the government from carrying out

comprehensive planning in Hong Kong. As Roger Bristow says, "the Hong Kong land-

use planning system has always operated on a basis of immediate impact, easy

implementation and not too costly proposals. and its result has been consistent over-

emphasis on those areas where planning has been relativelyreasy'r,30. The incremental

approach is to make planning flexible and adaptable so that it could be attuned to

economic and social changes. Another characteristic of the planning system of Hong

Kong before the implementation of the district administration is that the general public

was not involved in the plan-making process and few people had expressed their

discontent with this state of affairs. Even now, public participation in the planning

process is still inadequate and that is why a reform in the planning system is proposed and

will be discussed later in this chapter. The apathy of the Hong Kong people regarding

planning participation may be due to a combination of the Chinese having long been used

to autocratic rule and the reasons mentioned in Chapter two. However, with the

educational level of the Hong Kong people rising, there is a need for the territory to open 28Miners, N.J. 'The Government and Politics of Hong Kong', Oxford University press, Hong Kong, 19g3, 2gBristow, Roger, 'Land-use Planning in Hong Kong - History, Policies and Procedures,, Hong Kong Qxford University Press, Hong Kong, 1987, p.285. 3oibid, p.18 26

up the planning system for participation. The introduction of civic education in the school curriculum and the promotion of direct election in the various layers of the government structure would increase people's civic awareness.

Considering Hong Kong's planning structure, there are two committees presently in charge of the supervision of planning matters. They are the Town Planning

Board and the Land Development Policy Committee. In the past, execution and making of plans was the responsibility of a division of a government department. At first, it was the Public Works Department's responsibility and later the Lands Department's. The shift changed the direction of planning, since different departments appeared to have different objectives. To make things more complicated, planning in Hong Kong was split into three categories: town planning, building and development regulation and land and lease control3r. The implementation of these planning activities fell into the hands of different government departments which caused great difficulty in co-ordination. The Town

Planning Ordinance, which originated in 1939 and was amended in 1974, was a piece of procedural legislation which contained no enforcement provision and there was no formal channel to incorporate public opinion into planning In fact, throughout Hong Kong's planning history, the practice by and large was to follow a top-down approach. Public participation in the plan-making process was minimal and rather uncommon. Forums for the public to air their opinions on planning issues in the Legislative Council were rare and the District Office within the government bureaucracy was the only agency established to gather public opinion. As a response to the above problems, the Town Planning

Department was established in 1990 to coordinate planning related matters, and a consultative document on a comprehensive review of the Town Planning Ordinance was released for public consultation in July ,1991. Both of these symbolized the new era of planning in Hong Kong.

3libid. p,rst 2',7

Since the restructuring of the planning system, city planning in Hong Kong

is divided into three levels. From top to the district levels are: l. Territorial Plannng,2.

Sub-regional Planning, 3. District Planning The top two levels prepare the Territorial

Development Strategy3z and the concept plan and try to convert them into detailed plans with special needs, either political or economic. The basic measures to control land use in

Hong Kong are the statutory Outline ZorrngPlans (OZP) and Development Permission

Area (DPA):3. These plans are prepared by the Town Planning Board (TPB) which is an independent body appointed by the Governor. Most members of the Board are non- officials. Legislatively, planning of Hong Kong is guided by the Town Planning Ordinance adopted in 1939 which was subsequently amended in 1974. However, the content of it remained almost the same until the recent adoption of the Town Planning (Amendment)

Ordinance 1991 (the Amendment Ordinance 1991). Because of the social, economic and environmental changes occurring in these years, the Ordinance passed in 1939 was found inadequate for handling all the planning issues. Therefore other regulations or ordinances were passed to meet specific needs as circumstances required. Such ordinances include the Roads (Works, Use and Compensation) Ordinance which allows highway engineers to proceed independently on road proposals affecting to varying extents the layout of an area, and the Land Development Corporation Ordinance which prescribes the procedures for the preparation and approval of development schemes prepared by the Corporation.

Under the present planning system, draft OZP or DPA plans are prepared by the Town

Planning Board. The draft OZP or DPA will then be exhibited for public inspection for two months. Members of the public could raise objections on matters relating to the draft

32The Territorial Development Strategy is Hong Kong's long-term land-use and transportation suategy to meet the long-term needs of the population and would consider other socioæconomic activities. It tries to plan for the highest quality environment within resource and time constraints. 33DPA plans are transitional plans prepared after the enactment of the Town Planning (Amendment) Ordinance 1991 for areas which required immediate planning cont¡ol but where time does not allow the preparation of OZPs. DPA plans will be replaced within three years by OZPs. subject to one-year extension with the approval of the Governor in Council (G in C) 10 Lõ

plans within the said period. After consideration and hearing of all objections not

withdrawn, and reasons for the decisions of the TPB for approval, members of the public

could petition the Governor if they were still not satisfied with the decision. Provisions

for the operation of a planning application system were incorporated in the Ordinance in

1974. Section l6 of the Town Planning Ordinance also empowers the TPD to grant

permission for uses under Column 2 of the notes.

However, the existing procedures for public inspection of draft plans and

planning applications are replete with loopholes. First of all, although there are provisions

for the public to voice objections to the draft plans, there is no provision made for

accommodating suggestions from that quarter. Moreover, it is not fair for the TPD to

adjudicate objections since it is responsible for the drafting. Besides, the system of

hearing complaints takes a long time and, during the time that any objections are

considered, developers could have started their work because it is legal for them to do so

as long as their development complies with the zoningof the site. Draft plans take

statutory effect once they are published. Such practices may be problematic if zoning is

the issue that provokes objection.

In regards to planning applications, final appeals of applications turned

down by the TPD could be subjected to the scrutiny of the Governor in Council (G in C)

However, the procedures of petition to the G in C are cumbersome, and the G in C is not

obliged to grant a hearing to the petitioner under the existing Ordinance. At present,

anyone could make a planning application in respect of any site even without the

knowledge of the owner. The practice could be deemed unfair. Hence, it has been proposed to separate the work of plan drafting from that of appeal. Under the proposed new system , the Flanning Board (PB) will be responsible for drafting plans while any objections will be passed to the AppealBoard (AB), the new body set up to handle all 29

objections and appeals. There willbe no overlapping of membership of the TPD and AB.

Besides having the right of raising objections, the public will also be encouraged to make comments, suggestions and representations concerning the planning objectives and proposals of an area. Simultaneously, the Appeal Board would decide on appeals against the PB's decisions on planning applications. In the new proposed system, members of the public could raise their objections to the PB and the PB would then inform the represented of their preliminary views. If the person is not satisfied with the PB's preliminary view, he might request a hearing. To avoid undue delay, all representations on a draft plan and the PB's recommendations would be required to be submitted with the draft plan to the G in C within nine months of the expiry of the plan exhibition period.

Upon submission of the representation, the G in C could refer all the representations to the AB for further study, or conduct another hearing if he deemed it necessary. The G in

C would be the final adjudicator of the case and the represented would be informed of the

G in C's decision in due course. Should any amendment to the draft plan occur, the amendment would be published in the Gazette and newspapers. However, the amendment directed by the G in C would be open to further public objection. In terms of enforcement, there would be appropriate provisions for areas covered by a statutory plan.

No person should undertake or continue development unless (a) the development is an existing use; (b) the development is permitted under the plan; or (c) the necessary planning permissions have been obtained3a. Any person who fails to comply with the requirement of Enforcement Notices, Stop Notices and Reinstatement Notices in areas covered by the statutory plans would be liable to a fine. Under the proposed new system, public involvement in the plan-making process is emphasized. Thus, planning is hoped to be veering towards a fairer and more efficient practice (Fig.3)

3aComprehensive Review of the Town Planning Ordinance, Consultative Document, July 199i, paragraph 5.14 30

Governor's Instruction to Prepare Plan

Preparation of Planning Study, Consulting Relevant Public Authorities/Bodies

Exhibition of PlarLning Stud1, for Public : føontfrs f Inspection and Comments

Drawing Up of Plan

Consultation with Relevant Public AuthoritiesÆodies

Preliminary Consideration by PB

Assessment of Financial Implicatrons by Relevant Government Committee if Necessary

Fulher Consideration by PB

2 Months f Exhibition of Plan for Public Inspecton and Comments

Source: Comprehensive Review of the Town Planning Ordinance, Consultative Document, July, 1991,

Figure 3. Proposed Planning Preparation Process 3l

B. Mega-projects of Edong Kong

Planning in Hong Kong can be criticized as reactive and myopic. In the

1980's, efforts were made to change the image of planning of Hong Kong. The long-term

Territorial Development Strategy (TDS) was announced with the object of establishing a land-use transportation planning framework for long-term growth of Hong Kong. At the same time, two mega-projects35 were announced to further develop the urban areas and port facilities of Hong Kong. The first effort is embraced in the Metroplan36. Metroplan is a concept plan which tries to convert Hong Kong into a better place to live and work. In the booklet 'Metroplan-the aims', the goal of the scheme is clearly stated. It aims at restructuring the city and to 'bring about a better organized, more efücient and more desirable place in which to live and work'. The plan intends to restrict the population of the Metro area to 4 2 million The overall demand for housing in the period of 1986 to

2011 will be in the order of 1.4 million flats, of which 80o/o is anticipated to be in the metropolitan area. Most of these flats would be provided by the private sector and would be more popular because of the rising affluence and expectations of the Hong Kong people. The government is also shifting its housing provision policy from providing low- cost rental housing to home-ownership schemes. Moreover, large-scale reclamation and redevelopment would be carried out to 'thin out' congested areas. New-town planning and design standards would be applied to future reclaimed land and redevelopment areas as far as possible. Major comprehensive redevelopment areas were designated for West

Kowloon, Central wan Chai, Green Island, Aldrich Bay, Hung Hom Bay and Tsuen Wan

Bay (Fig.a). The obsolete buildings in these districts are seen as reservoirs of land for city

3sMega-projects are large-scale construction works. The two mega-projects mentioned in this thesis are: the restructuring of the urban areas of Hong Kong which involves the reallocation of commercial and residential activities, and the Port and Development Strategy u,hnch involves the building of a neu airport, t6-,new container berths and their related ûânsportâtion network. 'Metroplan-The Foundations and Framework', Strategic Planing Unit, Pla¡uring, Environment and Land Branch, Government Printer, Hong Kong. 32

restructuring. Besides, parks and open space would be provided in each of these districts

for active and passive recreational uses. Some of the specific objectives of the Metroplan

are:

a. to enhance Hong Kong's role as an international port and airport, as an international

business, finance and tourist centre, as a centre for a diverse range of light manufacturing

industry and as the centre of government for the territory; b. to provide opportunities to satisfy, as far as practical, housing needs according to what people can afford and where they would like to live; c. to achieve a more balanced distribution ofjobs relative to population concentration, the locational preferences ofnew enterprises and the ease oftravel; d. to sort out land-use patterns to create a more acceptable urban environment (which may involve relocating activities generating severe environmental problems); and e. to create an urban form that will foster a sense of community identity.

In order to fulfil these objectives of the Metroplan and to build more high- quality residential units in the almost fully-developed metropolitan area, eight areas of development opportunities are identified in the Plan. They are: a. potential new reclamation areas; b. new land-based sites that could be created by the adjustment of current, uncommitted planning proposals, c. redevelopment schemes already planned or likely to be undertaken by the Housing

Authority and, to a lesser extent, by the Housing Society, d. certain government uses which are underutilized, inappropriately located, are already obsolete or are likely to become so over the next 20 years; e. selected areas where current airport height restriction would be relaxed if adequate

:-¡.---L---- i t r¡rrtasuuLilure can De prouoeo,'l JJ

{ll-lli'lA g \ g N t"

'iilE NË\r,, ï i Ë..Rtii't'()RÍ-;s 5i t¡\ llN qm#r o S' Js" l,^' 6t$ o

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Source: Town Planning in Hong Kong, Government printer, Hong Kong

Fizure 4: Map ofHong Kong 34

f sites occupied by obsolete private building developments, and g. urban fringe areas which offer potential for recreational use and better amenities.

Among these, urban redevelopment is mentioned repeatedly in the plan as

a necessary means to provide land for development. The Metroplan also recommends

replacing the traditional renewal method with, first, a more comprehensive redevelopment and restructuring of environmentally-poor neighbourhoods containing pockets of obsolete private housing and incompatible land use of obsolete/underutilized land uses in locations

where improved accessibility and other conditions could be expected to entice new

development. It is anticipated that considerable land could be acquired by redeveloping

the older housing estates constructed by the Hong Kong Housing Authority and Housing Society.

However, the success of the Metroplan depends also on the transportation arrangements in the urban and port areas. In October 1989, the government announced the adoption of a long-term port and airport development strategy (PADS). The strategy is anticipated to cost US $16.3 billion to make Hong Kong the centre of transport and communications of South-East Asia. The strategy involves the construction of the new

Hong Kong international airport on Lantau Island, the five-fold expansion of the container port and the transport connection with the aiqport and the container port to other urban and industrial areas of Hong Kong. The new airport will have two runways with the first runway in operation by 1997 With the completion of the expansion of the container port, the volume of cargo handling is expected to increase from the current rate of 85 million tons per annum to about 450 million tons per annum in 2011. In order to effect fast and efficient transportation links from these developments to the urban areas, a network of high-capacity roads is planned to be completed by 2006. Some of these proposed roads are: a) a dual threeJane road crossing from Tsing Yi Island to Lantau Island; b) a dual 35

three-lane expressway on North Lantau between the airport and the North Lantau Link, c) new two-lane road bridges to connect the new container port to the old one at Kwai Chung; and d) a new passenger rail line to connect the airport to Hong Kong Island via the North Lantau Link, Tsing Yi and proposed reclamation in west Kowloon (Figs.5,6 e.7).

N

I

ø

I lJ lxm

Legend: ffi Reclamation by 2001 ffi Reclamation by 2011

Source: Pryor, "Metroplan: A Framewo¡k planning for City Growth',, and Development, Vol.6, No.2, 1990 36

-\i J,i r'lì!

\iICT'OÊ.IA H.ARROUR øc:

H C)Ì.i G Kr-r Þi G lSL.\-\ D

(U Öé (â o Þ Þ

5Ci\i.L 0 i.5 : . : f:r,4

Legend. * Principal Highway Network _ 1991 principal Assumed Additional Highway By 2001

Source: Pryor, "Metroplan :A Framework for City Grow.th", Plaruring and Development, Vol.6, No.2, 1990. JI

VICTORIA HATTBOT;R

TO NEW ATRPORT

HONG KOJ\CJ lSl.,;\ir'i"Ð

Legend: * Assumed Principal Highway Network 20l i

Source: Pryor, "Metroplan: A Framework for City Grouth", Planning and Development, Vol.6, No.2,

1990.

Figure 7: Principal Transport Network 2011 38

Cor¡clusior¡

Planning in Hong Kong has been undertaken according to the capitalist

mode for a long time. From the 1990's, however, Hong Kong's planning system is moving

towards democratization. In fact, democratization has been taking place in many areas of

Hong Kong's political system in order to prepare the colony for selÊgovernance. planning

ordinances and regulations were amended to suit the changing needs of Hong Kong and

to correct past faults. Now, planning acknowledges the need for fairer treatment of both

the developers and the citizens of Hong Kong atlarge; a departure from past practices

when allocation of resources and land were purely the work of the market mechanism. In

the past, the poor were usually the victims of development. However, with the refinement

of the system of appeal and the plan-making process of Hong Kong, the interests of the

poor are better protected.

How to incorporate Hong Kong's planning system with the mainland

counterpart is a problem. China's planning direction shifted with the Communist party's

philosophy and was thus unpredictable. As reflected in the recent planning strategies of

China, economic growth seems to be the dominant national goal. It is reasonable to think that China would want Hong Kong to continue some form of high-profile development in

order to lead the development of the other Chinese cities.

With respect to future urban redevelopment, the rapid development of the western part of Hong Kong provides excellent opportunities for redeveloping the older industrial and residential areas of that section. However, the implementation of the projects needs careful supervision to prevent the recurrence of past mistakes. In that iight, future development of Hong Kong must take a broader regional perspective.

Development and construction in Hong Kong should be in line with the development 39

taking place in the Pearl River Estuary. This will be discussed later in the thesis. This would solve many problems, especially redundant development and waste of resources. In the coming chapter, urban redevelopment methods of the world and Hong Kong will be discussed to see how they could affect the urban redevelopment of Hong Kong after 1997. 40

Chapter Foun: {Jnham Redevetroprment ar¡d the Fast [Inbam R.enewal Experience of'. ffiong Kong

An understanding of the socio-economic situations and the planning system of Hong Kong is certainly a prerequisite for devising a viable and sound urban redevelopment approach. Nevertheless, an examination of redevelopment efforts in other parts of the world as well as in Hong Kong could be equally important, since it would give planners insights into the benefits and problems of a variety of approaches. With that end in mind, this chapter will be divided into two sections. The first section will be an account of the urban redevelopment efforts taking place in other parts of the world, especially those of the u.s.A.. The second section will be an account of the past urban redevelopments in Hong Kong, both in the public and in the private sectors.

Section 1: World Urban Redevelonrnent

'No less than the city itself, the central area is a "dynamic organism,, constantll, in

process of evolution' The city cent¡e is continually being modified in both its form and

its function, by internal and exlernal costs forces.'

.4. Historical Overview

Man's metabolism changes with age and so does a city's. If a city is left to deteriorate in the natural course of things, given a long enough period of time, it will be a mosaic of derelict buildings which is unsightly and breeds all types of problems. Unlike wine and cheese, houses do not improve with time. 4l

Urbanists and urbanologists have tried to explain the decline of the urban areas; and prominent among them are the urban ecologists. They ascribe this decline to the'invasion'and 'succession'of a neighbourhood by lower-income groups. parks and Burgess were the forerunners of this idea. Burgess's concentric zone theory suggests the downward filtering of housing through the market mechanism, while Hoover and Vernon formulated a model of the morphological succession cycle37, and still others like J. Frushansky3S and Daniel Shefer3gshow the indicators of neighbourhood decline.

The fact that downtown blight is always conspicuous and occupies potentially high-rent sites, drives governments to redevelop the afflicted areas into better and more efficient uses. At first, urban renewal started in a very natural way. c.A.

Doxiadis says,

'In every human settlement, whether village or city, everybody who could (should)

rebuild his own house or shops on his own plot where these buildings had passed their

period of usefulness. This ca¡ be called the 'natural' process of urban renewal. In the

same way the city as a corporate body builds roads, sewers and water lines, a¡d

sometimes even remodels or relocates roads and public squtres b€tter to serve its new

requirements. It does those things as a matter of naftual evolution often related to the

'natutal' renewal private of properties. In these circumstancrs, urban renewal can be

3TAccording to Hoover atd Vernon, individuat concentric zones tend to experience a sequence of occupancy' The sequence of change are: L development of single-family hìusing lco.tesponaing to primary sucession), 2. spread of mu-lti-family housing, 3. infur of minority/ethni-c groups and/or economicallydisadvantaged groups and conversion of residential buildingi, +. detJiorátion of housing and decline of overall densities, 5. redevelopment --- from Korelli, piotr, Theory of Intra-urban struchue:Review and Synthesis. A Cross+ultu¡al Perspective', in "Internal Structure of the City", edited l-"..y S. Bourne, Odord University press, New yorL, 19g2, p.96. þI38Prushansþ, J., 'Introduction and Råview Érp"r', in "Urban óåvelopment and Urban Renewal,,, ed.ited by Ðan Soen, George Godwin, i981, p.5. 39shefer, Daniel, 'Causes and Consequences ,,Urban of Neighbourhood Deterioratron'in Development and Urban Renewal", edited by Dan Soen, George Godwin" l9gl,p.I73. 42

said to take place in a natu¡al u'ay and the city needs only to have an administration

fully aware of renewal needs'.40

However, as a city develops, individuals may not have the ability to keep up with the rapid economic and technological changes. The uneven distribution of wealth also impedes people's ability to improve their housing by themselves. The government as a public agent then intervenes to help to redevelop dilapidated neighbourhoods.

Government intervention in urban renewal started in the lgth century when it focused on ameliorating the poor and unsanitary living conditions of the city. Health codes were enacted to set the standard for minimum healthy human living. It was later, in the 1920's, that urban renewal began to be discussed more seriously in the U.S.A and only in 1949 that the term 'urban renewal', with the connotation of eliminating substandard and other inadequate housing, was first used in the Housing Act of 1949 of the United States¿r

To different people, urban renewal may achieve different objectives. C. A. Doxiadis says that urban renewal is 'an age-old process of replacing the buildings, houses and facilities that have outlived their usefi¡lness' or'a means to revive the central commercial and business areas of the city'+2. Charles Abrama3 and Langstaffa have listed 4oDoxiadis' c' A', 'urban Renewal and the Future public of the American city', Administration service, Chicago, 1966, pp. 14-15. alThe approach of urban-renewal following ,the the enactment of the Housing Act of 1949 was demolition of 'slum'and substandard housing and the construction of replacemenihousing .....not designed specially i1 a way to subsidize the housing of the poor' 42Doxiadis, c' A', 'urban Renewat and the Future of the Americal city,, public Administration Chicago, 1966,p.14. Service, a3ln charles Abram's opinion, u¡ban rreneual serves the following objectives: i. rationalization of disparate plots and traffc problems, 2. encouragement of aesthetics, :. spur to civic interest, 4. impetus to civic and cultu¡al improvements, 5. buftressing-interest of retigiousin"trtutionr, 6. spur to institutiona! expansion, 7' inducement to industry, 8. rebuiiding downtown] l. prouiae, of cooperatives. and 10. increased tax revenues. sThe objectives of urban renewal by Langstaff: 43

some of the other objectives that could be achieved by urban renewal. Other points to consider are that urban renewal would replace the low-income populations so as to create space for more profitable ofüces, commercial and luxury residential developments or the provision oftransport facilitiesas. In the 1950's people began to think about the possibility rehabilitating of some of the sounder dwelling units instead of large-scale demolition and rebuilding. In the 1961 Act, Sectio n 102 (a) provides thar the Federal Housing Administration (FHA) could incur loans for repairs and rehabilitation of homes and apartments in urban renewal areas46. However, the idea of slum clearance has never been abandoned. People see that rehabilitation should be done in conjunction with demolition and new construction. Even in less rundown areas, rehabilitation is apparently effective only if accompanied by some features of redevelopment programs. The IIK Housing Ãct 1974 did not abandon the idea of clearance. Instead, it introduced the concept of gradual renewal; that is, the management of a continuous process of small- scale change within older housing areas47. It was perceived that continuous small-scale clearance would neither cause serious distress in the community nor leave large plots of land undeveloped for a long period of time. A relocation arrangement which suits the affected tenants'needs can better be provided with this approach and it would not diminish the choice of home types, tenure and price. While this is a great improvement on the old clearance program, with the passage of time, people began to realizethat the root cause of urban decline may be a result of economic deprivation and the decline of an area. As a result, in the late 1970's, people began to express their interest in

l strengthening ' the economies of the inner a¡eas and the prospects of their residents; 2. improving physical the fabric of the inner a¡eas and maling their environment moie attractive, 3. alleviating social problems; 4' securing a new balance between the inner a¡eas and the ascibson' rest ofthe city region. Michael S and Langsta-ff, Mchael J., 'An Introduction to Urban Renewal,, Hutchinson. London. 1982, p.12. a6Welford, Irving H., 'Perspectives on Housing and Urban Renewal', praegar, york. aTThomas, Nerv 1975, p/193. Andrew D., 'Housing and Urban Rãnewal: Residential Decay and Rebabilitation in the private Sector', Allen & Unwin, London, 1986, p. l1g. 44

comprehensive redevelopment approaches that incorporated economic renewal. In

addition, policies were developed to tap private resources for urban redevelopment.

Fublic-private partnerships became more comrnon in the 1980's. Ferhaps this was

influenced by the New Right'movement which called for policies that reduce state

intervention and return to the tradition of liberalism utd laissezfaire. Policy-makers saw

that economic decline is the root cause of neighbourhood deterioration. Hence, an attack

on the economic problem is a more efficient tool to tackle physical blight than the

traditional urban renewal instruments which deal mostly with the symptoms of urban

decay. In this vein, there emerged concepts like the 'enterprise zone' and the 'urban

development corporation'. The idea of enterprise zones is to set a particular area in the

inner city for special investment. Concessions are granted in this area; for instance,

investors are exempted from certain regulations in order to compensate them for some of

the unfavourable factors, such as traffic jams, high land cost and obsolete infrastructure,

found in the city centre whilst some of the urban development corporations are

commissioned to discharge urban redevelopment jobs. In some cases, projects of the

urban development corporations are joint-venture programs between the public and the

private sectors. Plans and development are usually devised by the corporation while private developers are invited into partnership to carry out the jobs. According to

Andrew D. Thomas, these orgaruzations have two dimensions: the policy dimension, in which the goals of the community are articulated, and the operational dimension, in which those goals are pursued. The purpose of public-private partnership in an urban development corporation is to link these dimensions in such a way that the participants contribute to the benefit of the broader community while promoting their own individual or or ganzational interests.

There are a number of urban development corporations operating in

Canada. Some of these are: Harbourfront in Toronto, Canada Place in Vancouver and 45

North Poratage in winnipeg. Each of these urban development corporations is set up for a particular purpose. Some may be vehicles to maintain or improve the existing

infrastructure while others may be set up for boosting development.

Parallel with the'new right'movement was the civil rights movement. In the 1970's, the rapid growth of locally-based groups in working class generated political pressures 'from the bottom up'. The forgotten poor began to organizeand challenge professionals and political orthodoxiesas. The movement stirred up the working class which protested over forced relocation and demanded subsidies for housing and social services. It is indirectly through this movement that the interest of the local community began to be respected. In this climate, community development corporations (CDC) were introduced to rebuild housing and commercial infrastructure in declining urban and rural areas on a community basis. In a nutshell, urban redevelopment in the western world, especially in the U.S.A., could be classified into four major stages of change. They are presented below in order ofsequence.

1 The period lasting from the 1930's to 7949, which emphasized slum clearance to revitalize inner cities.

2. The period lasting from 1949 to late 1960, which was the most ambitious period of urban renewal. The approach still abided by the traditional method of

demolition with some improvements in the practice of urban renewal. 3. The period from 1970 to 1980, in which more emphasis was placed on urban rehabilitation, housing and environmental improvement. Gradual renewal was

espoused; for this caused less disturbance to the residents.

4. From 1980 to the present. Emphasis is put on attacking the basic cause of urban decline; that is, economic decline in the inner city area. Economic renewal ascibson. Michael S and Langstaff, Michael J., 'An Int¡oduction to Urtan Renewal,, Hutchinson, London. 1982, p.165. 46

is now the dominant practice in urban redevelopment with the stress on public- private partnership.

B. General Tre¡rds of World {Jnba¡l Redeveloprnemt

Beginning with the trial and error approach of fifty years ago, people have realized that urban redevelopment is a complex issue requiring great care. Grievances

caused by large-scale slum clearance have been heard and the general trend ofurban redevelopment is moving towards more public-private partnership. The main aim of present-day urban redevelopment is to motivate individuals to carry out their own

maintenance works and revitalizethe community in which they live. However, the

approach to choose does vary with ideology In socialist countries, for instance, the

stress is still on physical rebuilding rather than improvement to the living conditions,

while in some countries, for instance the United Kingdom, the stress is on improving the

housing stock. Still others, Iike the United States, aim at building more profitable

commercial office buildings in the city centres. Nevertheless, given a free market economy, the following trends seem to prevail.

a. Developed countries do not practise large-scale slum clearance exclusively.

Problems of the nature of dislocation and distress suffered by affected residents

were found to be acute. Studies show that the affected residents suffer from psychological distress even six months to a year after their displacement. This is

more profound in female residents being displaced+r.

b' Urban rehabilitation is attempted on a large-scale with spot clearance as an

assistance to pull down decrepit buildings which are beyond repair. Small-scale

agWilson, James Q., 'Urban Renewal: The Reco¡d and the Controversy,, MIT press, Cambndge, Mass., 1966, p.360. 47

clearance is also relevant in cases that need space for road widening and open spaces that are good for the whole community.

c. planning careful and projection of future growth for the city is necessary. Retrofitting and remodelling will be encouraged in housing possessing sufficient flexibility, in order to allow for the changing needs that people have at different stages of life. These can serve as an incentive to retain people', avoid excessive migrations and act as a preventive measure to keep the neighbourhood from rapid decline. Moreover, training and educational programs for residents are necessary to equip them with the knowledge to maintain their houses. It is also advisable

for the city governments to organize street festivals and neighbourhood

communities to arouse people's sense of belonging and concern for their community.

d. Public-private partnership is a growing trend in urban redevelopment. It helps to ease the government's financial strain while meeting community needs at the same time. Joint ventures between the public and the private sectors can eliminate some of the bureaucratic practices of the public sector. They can deal with

problems more dynamically and flexibly.

e. There is the rise of the desire for participation by the general public. It constitutes a real pressure applied on the politicians. This will be a force in

planning from the bottom up.

'In tlle modern urban society where economic and social activities are increasingly pluralistic and demand of urban la¡d is escaiating, renewal of existing resources in order to meet these new and diverse needs is seen to be not only reasonable, but also desi¡able. Urban redevelopment, in most cases, increase density and follorvs market 48

demand' These projects are built in accordance with the rules of effrcient land

utilization, productivity maximizalion and to safeguard capitat investment. As a result.

they increase land income and distribute spaces to more profitable activities,5O

The purpose of this section is to give readers a picture of the problems that Hong Kong has encountered during its course of urban redevelopment. The actions taken both by the Government and the private sector in tackling the problems will also be examined' Finally, the future of Hong Kong's urban redevelopment methods will be considered.

.4.. Historical tsackground

Historically, urban redeveropment in Hong Kong has ragged behind the trends in the Western World, but it also faced very different circumstances. It has been mentioned in chapter two that the main urban area of Hong Kong was sited in the strips astride the two shores of Victoria Harbour. owing to the ruggedness of the terrain, fi'lrther urban expansion was restricted by the steep slopes found around the urban areas. To maximizethe limited developable area, high-density development has been the norm since the early days of urbanization. Over-crowding became a problem which caused, and continues to cause, government the much anxiety. Besides encouraging the construction of sþscrapers, Iand reclamation is seen as a means to increase the supply of land' Reclamation of Hong Kong can be dated back to as early as 1g55, and the pace of reclamation accelerated in the recovery period after the Second World War, Now, Hong Kong has more than 1.7 percent of its totalland area reclaimed from the sea (Fig g)5r.

Yin-wang, 'Planning Aspects ]ofyot'-n of urban Redevelopment', Hong ----'ÞKong Development,vvrvrvy¡rrw¡rl' 1982,p.7. ----o Mar.- slYeh, A' Gar-on, 'The Mobilization of Urban Resources- urban Redevelopment in Hong Kong,, in 'Resources, Environment and Development" ed.ited by_Leung ctri-teung,i Jim chi-yun g and zuoDa Kang, Cent¡e of Asian Studies, University of Hong Kong,l9Z9,p.+Z+. 49

.owl.ooN

HONG KONG

0123. .r-\4 ISLAN-D

Legend: ffifl Reclamation befor e 1945

Nl R"cla*ation betwe en 1945-67

ffi Reclamation betwe en 1967-7g

ffil R..lu.ation after 1978

Source: Yeh, A. Gar on, "The Remobilization of Urban Resources-Urban Redevelopment in Hong

Kong"' in Resources. Enviroment and Regional Development, edited by Leung Chi-keung, Jim Chi- and zuoDa 1nng, Kang, centre of Asian studies, university of Hong Kong, lggg, p.425. 50

Furthermore, the government implemented the New Town Development program in 1972 with the announcement of the 1O-year Housing PIan by the Governor, Sir Murray Maclehose (now, Lord Murray Maclehose). To be sure, the new-town movement has been successful in many respects; for instance, many people have now moved to live in new towns like Tuen Mun, Shatin, Tai Po and Sheung Shui (refers to map of Hong Kong on p' 3l), but the urban area remains the centre of activities. Nevertheless, due to inadequate maintenance, housing and environmental conditions in some older parts of Kowloon and Hong Kong Island are deteriorating. obsolete types of tenements and structures were noted by Professor sir Patrick Abercombie in his Hong Kong-preliminary Planning Report in 1949. The dichotomy of housing conditions was further illustrated by the fact that, between 1966 and l973,around 70%o of thetotal gross floor area of private housing in the metropolitan area remained concentrated in the inner districts of the Hong Kong Island North and Kowloon. In fact, almost 80yo of the population live in the nalTow strips fronting the Victoria Harbour. Hence, population densities in Hong Kong, especially in the main metroporitan area which is over 30,000 persons per square kilometre' are among the highest in the world. The poor quality of the buildings built in earlier days could be ascribed to the fact thatquantity was more important than quality in terms of housing supply in the pre-war days and in the period of ever_increasing population consequent upon immigrants fleeing to Hong Kong after the communist take- over in China' There had been a problem with squatters on the hillsides of Hong Kong, but after a few decades of arduous effort by both the government and the private sector, people of Hong Kong by and large have perïnanent dwellings. Hong Kong now has a building rate of 13 homes per 1000 inhabitants which is far more than the recommended rate of the IIN of 9 or 10 homes for every 1000 inhabitantss2. The government is indeed the biggest provider of housing in Hong Kong. The annual production of public housing s2Drakakis-smith, D.w.,'Tenement Slum Renewal pacific of Hong Kong,, viewpoint, Vol. 13, Sept., 1972, p.157. No.2, 5l

averaged 35,000 flats and currently more than 40%o , or 2.5million people, live in social housing.

With people's basic housing needs met and their expectations rising, the poor housing conditions in the older parts of Hong Kong seem intolerable. It has been

shown in a survey of the territory planning units by Drakakis-Smith that the most

rundown areas on Hong Kong Island are Western District, Wanchai, Tai Hang and Shau

Kei wan, while in Kowloon and New Kowloon they are yau Ma Tei, Hung Hom, cheung \ilan, sha shek Kip Mei, Kai Tak, Jordan valley and yau Tong (Fig.9). The survey also uncovered the significant fact that nearly 50% of the population in the main urban areas of Hong Kong Island, Kowloon and New Kowloon live in districts where the

overall rating, based on size, amenities and density, is poor and very poor53. Another

survey by the Hong Kong Housing Society in 1983 shows that 6,000 slum properties were identified as being in deteriorated, poor or derelict conditions in the main urban areas. They represent 13.5% ofthe total number of properties surveyed and were mainly concentrated in Sheung Wan, Wan Chai, Sai Ying Pun, North Point, Tai Kok Tsui, Mau Tau Kok, Yau Ma Tei and Hung Hom.

The government's effort in renewing the inner city began in the early

1960's. Before 1960, the Hong Kong Government assumed a minimal intervention attitude. In this period, urban renewal was small in scale and undertaken mainly by private developers. The govemment became aware of the need to improve the slum area 1884, in when the bubonic plague broke out. The poor sanitary conditions and overcrowding were seen as the major causes of the disease. The most afflicted slum areas were in the western District, particularly the Taiping shan locality. fu an

53Pryor, E.G., 'Environmental Quality and Housing Policy in Hong Kong,, pacific Viewpoint, Vot. 16. No.2, Sept, 197 5, p.195. 52

Wørgbisin TAK MAUoKât ¡\^

4rî*' KwUn ïong ^

ú

sou¡ce: Property Re'iew, 1991, Rating and vaiuation Department, Hong Kong. 53

emergency measure to prevent further spreading of the plague, the Government passed the Tai Ping Shan Resumption ordinance in 1894, under which properties of 3.4hectares of land were resumed5a, demolished and the area redeveloped. In 1904, a further action was taken by the government to resume land in the Tai Ping, Lower Lascar Row and Kau U Fong areas in order to upgrade the sanitary conditions, realign lot boundaries,

amalgamate small lots and provide community facilities.

After 1904 there was little government effort in urban redevelopment. For the whole of the 1950's, the Hong Kong Government was preoccupied with the provision of resettlement estates and squatter clearance. As we have mentioned earlier, the large influx of immigrants overloaded the government's capacity for providing housing, especially after the big fire of Shek Kip Mei in 1953 The government was compelled to provide permanent dwelling units to the large number of squatters whose shelters were prone to the damages of all types of natural disasters. The government saw it would also be cheaper to resettle the squatters than to provide relief for them. In addition to this, Iand resumed from squatters could be converted to more economically-efficient uses. Considering the imminent and urgent need to rehouse squatters, the government built simple Mark I and II buildings (Fig.10 a&b¡ss in which little private space and inadequate community facilities were provided due both to lack of thorough planning and financial resources at the early stage of industrialization. A more crucial factor in determining

5a1t-1s a word used by the Hong Kong Government to refer to actions of taking or expropriating land public purpose. for 55The basic design of Ma¡k I Buildings is in a'H-shape'plan with the room units on the long arms, flush laterines, laundry and ablutions on the cross piece attã rour staircases at each corner. Each room unit was l1'15 square metres and access was from a balcony running round each long arm of tne'ft'. (One domestic room unit accomodated five adults making - o".Iup*ry ,itta otl.zs square *"o.ì p", p€rson. The early Mark I buildings were six and seven storeys). Between1959 and 1961, a new type orstandard block was designed - Mark II. The basic planning u.ár little change from the early prototype but the courtyards were enclosed by hollow block screen wall within whichlhe end st¿ircase, *.r. This change provided an addition ilrrø. of 24 domestic rooms with private balcony to each room ground-floor and fó* lurg. shops. - from The First Two Million, The ilong Kong Håusing Authority. 54

ts.¿\1'HIì()C)\,IS q, .4.NT) I,Å1'RI\IJS \!ASII ,TRE.TS å

Source: The First Two Million, Hong Kong Housing Authority

Tffi" 55

what to build arose from the fact that the government, at that time, was uncertain about the political future of Hong Kong and huge investments in housing would seem rather risþ' These inadequate Mark I and resettlement II blocks left much to be desired and led eventually to the government's plan to redevelop the older housing estates in the 1970's. During the whole of the 1950's, as stated above, urban renewal and urban redevelopment were largely accomplished by private developers in a sporadic and piecemeal fashion. In this regard, restrictions on building heights were relaxed. In r935, Hong Kong passed the Buildings ordinance and associated regulations to restrict building heights to five storeys' However, with the sudden increase of immigrants after 1949 andchanges in building technology, the government revised the Building ordinance in 1956 to allow higher buildings to be erected. The plot ratiosc changed from below 3 before 1955 to 6 in 1956 and, in some cases, the plot ratio could be as high asz0. The relaxed plot ratio enabled private developers to build higher buildings. Therefore, many low-rise buildings were demolished at that time. However, all this private demolition and rebuilding was unco-ordinated. 'Pencil development's7 was common with concomitant serious trafüc congestion in these areas' This outcome finally led to the introduction of new regulations in 1962 to regulate the maximum density of development. The relaxation of the plot ratio in I956 marked another period that exacerbated the already crowded and environmentally-poor condition of the inner city of Hong Kong.

56Plot ratio is a means of controlling the building. It is used to represent the density of a development. The plot ratio is calculated by measuring the total floo¡ area ora uuitoing and relating this to the area of fhe land within the curtilage of the building site, e g., a four-storey covering the whole site has a plot ratio of 4: l, as bas an eight-storey building cou.ring trar plot t¡e site ratio is similiar to the floor space index but excludes a¡y part of the road width and pr*la.r a more consistent sta¡da¡d for controlling development on individuat_sites, especiaily corner ones - Goodalr, Brian, ,Dictionary publication, of Human Geography', Facts on File New york, 19g7. 57In the early days, because of the fragmentation of ownerslun. if rvec rtiffì¡,,rr ra ^¡¡aar.r- r^-r ¡- comprehensi'e rede'eropment, privatã deveroperswù;,t*ïääöh,;i:#.;i:iäï #iï'",, low-rise buildings in a single lot. As a resuJt, these developmentr pencils protruding uniformly low -.1'*" out from a surface. such developments are caflø þnðl development, 56

ts. {Jrhan RedeveEop¡nent im the Non-Fublic Housirag,A.neas

The first large-scale government intervention in urban renewal took place

in 1964 in a selected area of sheung wan, which is the place where people first established the layout and the street pattern characteristic of 'China Towns'in other cities around the world The scheduled renewal district, which covered some 256 acres, housed over 1,000 persons per acre and had only2.1 acres of public open space. Two- thirds of the buildings in the district were built before 1945, compared with only 9%o for the private 5efound total stock of the metropolitan area58. Pryer that only 3g o/o of the structures were in sound or good condition. Only 41o/o of the residents lived in selÊ contained flats and almost 30% resided in a single cubicle, bedspace or cockloft60. Because most of the buildings there were constructed before 1945, they were under rent

control; consequently landlords could not afford to carry out routine maintenance because of the low income they earned from renting their flats. Land use in the district was extremely mixed, with small grocery stores, factories and warehouses found among residential dwelling units. Uses other than residential accounted for almost 30%o of the total6l. Moreover, the mixture of land use, commercial and storage activities generated much traffic. Narrow lanes abounding with hawking activities and illegal parking in the district further exacerbated the situation. In this regard, it is not difficult to understand why the problem of traffic jams was so serious. However, looking from the viewpoint of the community, there were strong social and economic ties among the residents and business people. The conditions of Sheung Wan were similar to those of many other parts of Hong Kong, such as Yau Ma Tei and Tai Kok Tsui. However, due to this ssProperry Review lg72,TheRating a¡d Valuation Department, Hong Kong Government, table II 5eDr E.G. Pryer is a Principal Government Town Planner of the pta-nning Department, Hong Kong Government. 6oDrakakis-Smith, D.W., 'Urban Renewal in an Asian Contexl', Urban Studies, Vol. otibio, p.zll 13, 1976, p.299. 57

district's close proximity to the Central Business Area and the high bid rent values, it was

chosen as the first pilot renewal scheme. In 1964, a working party was appointed by the

Governor to study the area and its report, released in 1965, recommended 'the clearance

of property from an existing area of housing which is generally of pre-war construction, is

in a dilapidated condition and contains tenants living in bad conditions of congestion and

lack of light and ventilation below reasonable health standards'62. Generally, the working

party proposed a two-stage program. The first stage involved the designation of an

Urban Renewal District consisting of four Urban Renewal Areas of about 10- 1 5 acres

each in Sheung Wan, Wan Chai, Yau Ma Tei and TaiKok Tsui. An area in Sheung Wan

was chosen as the pilot scheme which required the purchase of some 365 individual lots

and the rehousing of 13,000 people; the second stage would be the actual program of

implementation. Through clearance, the working party hoped that the living environment

would be upgraded, more public open space would be provided, trafiìc circulation could

be improved and local facilities like schools would be provided. Land resumption would

be by Crown Lands Resumption Ordinance. However, slum clearance of the pilot

scheme was prolonged. It was not until May 6th,1968 that the program really

commenced. Sufficient land was acquired by 1974, the clearance and demolition program

was finished in 1978 and the entire program was completed in 1981. The whole process

took 13 years to complete.

Entering the 1970's, the government's attention shifted to new-town

development with the announcement of the lO-year Housing Program63, although there were still some efforts maintained in urban redevelopment. In 1973, the Hong Kong

Government introduced the concept of Environmental Improvement Area (EIA). The llneport of the Working Parry on Slum Cle¿¡a¡ce 1965, p.l 63The l0-year Housing Program targeted at providing t.d million indil'idual units of accommodation in public-housing schemes by 1983-84. The New Territories was proposed for such a large-scale of development because it was deemed to be the only viable source to provide suffrcient lãnd fo¡ such development. 58

objectives of this initiative were to upgrade the environment by rezoning acquired private

land to goverrlment, community and recreational uses. Besides the former Urban

Renewal District excluded from the Pilot Scheme Area, the EIA included Wan Chai, yau

Ma Tei, Shek Kip Mei, Tai Kok rsui, cheung Sha wan and Kennedy Town. The new

statutory outline zoning plans were prepared by the Town Planning Board in 1969 and the Government entered agreement-to-purchase with private owners. However, the property boom of the early 1970's and the economic downturn of 1974-5 put the

Government in a very difficult position. Cost of land acquisition increased twofold from

IIK $207 million to over HK $458 million, with a further estimated HK $400 million for new areas that were contemplated for improvement6a. Furthennore, the lack of manpower deterred the demolition of many acquired properties, while the acquisition of land aroused at times strong objections from property owners (as evidenced by the case of the'six streets'in Yau Ma Tei). Hand in hand with Environmental Improvement

Areas, the Government implemented the Comprehensive Redevelopment A¡eas (CRA) policy (Fig. I 1). This last was a practice to zone a parcel of land as a 'Comprehensive

Redevelopment Area' so that redevelopment would be carried out in a co-ordinated, balanced and cohesive fashion. Private developers were encouraged to participate in the redevelopment schemes. First of all, they had to submit a master layout plan to the Town

Planning Board for approval. In their master layout plan, they had to include the provision for social facilities. Usually, only land of non-renewal leases about to expire would be zoned for CRA. Examples include Tsim Sha Tsui'Four Street 'case, City

Garden and the Provident Centre.

Viewing the possibility of high cost in land resumption, the Hong Kong

Government delegated some of its renewal responsibility to the Hong Kong Housing

6aBristow, Roger, 'Land-use Planning in Hong Kong - History, Policies and Procedures', Hong Kong Oford University Press, Hong Kong, 1987, p.226. 59

N t I I

ö

Legend: I EJSix Street Development 2 ffinnvir.Improvement A¡ea 3 mFourth Street Area 4 ffi Co*ptehensive Dev. Area 5 Pilot H Scheme A¡ea 6 EUrban Improvement Scheme 60

Society by granting this body a loan of HK $100 million for its initial operation. As a result, the government reduced its involvement in urban redevelopment. In 1974, the Hong Kong Housing Society launched the Urban Improvement Scheme with the following objectives:

1. to improve the environment of old districts by redeveloping properties with fragmented or absentee ownership;

2. provide to new housing for affected families in the same locality at discounted price/rentals, thereby augmenting the government's efforts in this field; and 3' to retain the strong social and community ties which are normally found in old districts65.

In the beginning, the government would help to resume land and grant the resumed land to the Society through a Private Treaty Grant, but starting from 19g1 the

Society was to pay the full market land premium for all government land grants. In selecting sites for redevelopment, the Society would usually choose sites that required imminent improvement, but which private developers had no interest in redeveloping. Normally, the Housing Society would resume land by negotiation Only for intractable

cases would the Housing Society request the government to use the Crown Land Resumption Ordinance to resume land. Affected tenants could buy a flat under the scheme at a concessive rate or receive cash compensation. If they were eligible for public housing provided by the Housing Society or the Hong Kong Housing Authority,

Íurangement would be made to rehouse them there. However, due to insufficient resources, some projects were abandoned and the redevelopments carried out were small in scale because of the limited size of the Society's resources. Hence, the Urban

65Crosby, A.R', 'Redevelopment in the Public Sector', Plaruring and Development, Vol.2, No.l, 19g6, p.22. 6l

Improvement Schemes of the Housing Society did not have much impact on the amelioration of the living environment.

In the 1980's, the Hong Kong Government was seeking other viable urban redevelopment alternatives. A number of committees were set up in these years to oversee or evaluate the government's urban renewal efforts. In March 1982, the Special

Committee on Land Supply (SCLS) was established to review the government's policies

in regard to urban redevelopment. A co-ordinating Urban Renewal Team (CURT) within the Town Planning Division of the Lands Department was set up in 1984 to facilitate co-

ordination in the planning and implementation of urban redevelopment schemes in the

territory. The government realized that the major obstacles it faced in urban redevelopment concerned consolidation of land holdings, amalgamation of properties and the acquisition of vacant and abandoned buildings. It knew that the private sector is

more adept at acquiring land through negotiation; therefore the government began to

think about passing the renewal burden to the private sector, especially since the Special

Committee on Land Supply's i981 report This report mentioned that, since the private

sector has less constraints on resources for urban redevelopment, they could constitute a potential source for urban redevelopment programs. As a corollary, a Working Group on Private Sector Participation in Land Production was formed in November t 981 to exploit the potential of private-sector participation. It was finally suggested in a 1982 report that the introduction of a'Land Development Corporation'would be a positive answer to deal with comprehensive urban renewal in Hong Kong. As outlined by the Director of Lands,

J.R. Todd (1985), the objectives of the government in urban redevelopment were:

a. to speed up private sector development in selected areas;

b. to encourage the participation of land owners;

c. to improve the quality and economic benefit of developments by assembling

larger sites; 62

d. to ensure equitable treatment of the tenants; e' provide to improved community facilities including better trafüc circulation; and

f to minimizefheneed for direct government subsidies and the application of compulsory requisition powers.

The land Development Corporation was finally established in January 1988' The Land Development Corporation Ordinance passed in 1987 had given it the power prepare to and implement development proposals in areas where attention was required. The aim of the LDC, as stated in its promotion pamphlet, is to rehabilitate urban dilapidated areas with a view to transcending their present limitations and realizing their full potential (see Figs. n aeÐ. To facilitate the initial workings of the LDC, the government lent it HK $100 million. However, since the final goal of the coqporation

was to be 'selÊfinancing', it had to enter into joint-venture partnership with private developers to assemble sites, deal with compensation, arrange rehousing, plan the redevelopment and carry out the construction. Basically, the LDC would acquire land through negotiation, and only if negotiation fails would the LDC apply for the use of the Crown Land Resumption Ordinance to resume land . Since the LDC is a non-profit

organization, social and community benefits would be considerations for redevelopment. However, owing to the fact that the LDC has to be financially selÊsufficient, it would, at least at the beginning stage, develop sites that are more profitable in order to keep the organization in operation.

C. Unbar¡ Redevelopment in Fuhlic HousÍng.{reas

The government's provision of housing began after the big fire of 1953 swept away more than 50,000 squatter homes in Shek Kip Mei. The first multi-storey 63

-:

--4_ ¡ @_-- á @Þ ø *----r'r: Wwø øffi

Figure 12b: A Site for

Infill by the LDC

tþ;Þ io 64

blocks were completed in September 1954 to rehouse the massive group of homeless people' The Hong Kong Government began its large redevelopment program of the public housing estates in 1972. The objectives of the government's redevelopment of the old public housing estates were:

1- to upgrade the use and environment of the actuar site;

2' to assist in the reorganization or restructuring of the local infrastructure and facilities;

3. to assist in the objective of reducing excessively high urban densities; 4. to break up large concentrations of low-cost public housing in certain areas;

5. to realize the full or changed potential of the site;

6. to correct planning errors of the past.66

The first redevelopment scheme started in Shek Kip Mei where the oldest resettlement blocks were located and, later, the scheme was extended to all twelve of the old Mark I and Mark II resettlement estates. The first approach to redeveloping the decaying public housing was in-situ conversion. Two units originally set back to back, u/ere converted into one single unit with its own toilet, shower and kitchen space. The conversion not only ameliorates the living conditions in these blocks by changing them into self-contained units, but has also decreased the overall density of the area. After the whole area had been redeveloped in 1984, the population density was halved from over 2,000 persons per acre to about 1,000 persons per acre. The conversion scheme took less time and was less expensive than redevelopment. The cost of conversion was HK $15.6 million as against HK $53.4 million if the units were to be redeveloped. However, in-situ conversion entails the problem of displacement. In the Shek Kip Mei case, thanks to the presence of the Pak Tin Estate, a better-equipped housing estate nearby which

66Messling' B.R', 'Redevelopment of Public Housing Estates in Hong Kong - An Agenq,for change,, in Plarning and Development 5th cAP Plenary Conference a¡d 4th Ea-st asiã worksñop ,äg, p.7 65

could serve as a reception area for the affected tenants, much of the hardship of relocation has been mitigated. It would have been a challenging task for the government to rehouse the huge population. Therefore, it is seen that in-situ conversion is feasible only where buildings are structurally suitable for conversion. In this particular case, their location made comprehensive redevelopment inappropriate and replacement housing was

available in the same district. In the event, 32Warkl and II blocks involving 3,663

domestic units were converted in this wat'7. In 1976,the Housing Authority took another approach towards public housing redevelopment. This was the'pump priming' approach. Under this approach, new high-rise and selÊcontained blocks were built within the same housing estate on land not used for housing. Most often, parks and open recreational areas were borrowed from the Urban Services Department for such use. After their completion, new housing blocks were used as reception accommodation for residents living in the decaying and obsolete type of public housing in the same district, so that the vacated housing block could be demolished and provide space for further redevelopment. Pump-priming schemes have been carried out in Lok Fu and some of the Kowloon Central Estates. However, the'pump-priming'approach was time consuming and did not meet the urgent need for redevelopment in the older parts of the public housing estates. In 1983, the Housing Authority accelerated its pace in the redevelopment of its public housing estates as a result of the completion of the four planning studies of the Kowloon Central Estates in 1985 The Governor then directed efforts to redevelop all Mark I and II resettlement estates by 1990 ( Figs.13a&b). Nonetheless, redevelopment of all Mark I and II public estates was not completed as scheduled. AII demolition work was finished a year later in June, 1991. However, back in 1985' an ertended redevelopment program was announced to redevelop 26 blocks afflicted with structural problems in eleven estates. The number of families affected by

67Crosby, A'R., 'Redevelopment in the Public Secfor', Planning and Development, Vol.2, No. t, 19g6, p. 16. 66

'.

Fizure 13a: The Demolition of old Mark I Buildine in Kwun Tong. Kowloon

Figure 13b: New Public Housings were Built on Redeveloped Site 67

this program was of the order of i5,000. The program was not well planned, especially in issues concerning the housing arrangement of the displaced tenants. Fortunately, there was the Cheuk Yuen Estate available in the Kowloon Central District. In April 19g7, a comprehensive redevelopment program was approved by the Executive Council. The program was started in 1988 and is expected to last for twelve years. It involves the redevelopment of over 500 housing blocks in 40 estates. The operation will affect 0.g million people; that is, 74o/o of thetotal population of Hong Kong68. In this new program' tenants were given removal notice five years in advance of actual demolition so as to enable them to apply for housing in another public housing estate of their choice once vacancy is available, and they would be given priority in being rehoused there. In

this program, priority of public housing estates to be redeveloped depends on : 1. structural conditions of the block;

2. expenditure on maintenance;

3. the possibility of integrating redevelopment with the existing community, such as the availability of nearby community facilities that could cater to the needs of

the residents ofthe redeveloped estates;

4. redevelopment potential of the site, i.e., the possibility of building new housing

blocks in situ; and

5. the availability of suitable reception space (which can be defined as: i. vacated flats within the same estate and , ii new or vacated public flats in the same district).

6sMessling, B.R.. 'Redevelopment of Public Housing Estates in Hong Kong - An Agency for Chnage,, in Plarming aad Development 5th CAP Plenar¡' Confeience and 4th Ea"st Asiã Worksñop 'ás, p. t 68

Ð. The T'nansfonr¡¡atlon of {.Inba¡r Redeveloprmemt .{ppnoaches

Since govemment the first declared the Pilot Scheme of Urban Renewal in 1964 as a'public purpose', urban redevelopment has been carried out in Hong Kong for nearly three decades. On the side of the private sector, urban redevelopment changed from slum clearance to the Land Development Corporation approach and on the side of the public sector, approaches to redevelopment of the older public housing estates changed from in-situ conversion to a comprehensive redevelopment program in 19gg. Both changes relate to a change in the government's philosophy in urban management. According to Peter Fong6e, there are three phases of government intervention in urban redevelopment.

The first phase was the pre-1960 period of minimalgovernment intervention The government wanted to be involved in redevelopment programs only if the slum created sanitary problems and immediate actions were inevitable, as was evident with the resumption of land in Tai Ping Shan District for fear of continuous spread of the plague. Much of these early renewal projects were regulated by market mechanisms. Only the more profitable sites would be redeveloped. Therefore, redevelopment in this period was done in a piecemeal and unco-ordinated fashion. As a result, no efforts were made to improve the environment in declining districts because the development of community facilities and open space, and the widening of roads, were regarded as unprofitable.

The second phase was the 1960-19g0 period of ad-hoc government intervention. During this period, buildings in certain areas of the city were severely

69Peter K'W. Fong is Lecturer and Acting Assista¡t Director of the Cent¡e of Urban Studres a¡d Urban Planning, University of Hong Kong. 69

dilapidated and environmental conditions there were below reasonable expectations and standards' The government was compelled to carry out some renewal or environmental improvement work. However, government support was halÊhearted and skewed to profit-making; for instance, the choice of part of Sheung Wan as the pilot scheme area (PSA) was seen as a way to increase the tax revenue. The conditions of Sheung Wan was not necessarily worse than districts like Yau Ma Tei and Wan Chai. However, it was reasoned that the demolition of the domestic units in Sheung Wan could provide space for office buildings and serve as an extension of the Central District. Moreover, the handing over of the environmental improvement area projects to the Hong Kong Society seemed a gesture of government the to evade its own responsibility. The few resources and limited manpower that Hong Kong Housing Society had at its disposal was in itself a hindrance to the pace of urban redevelopment.

The third phase was the post-1980 period of search for a new straregy. the government made no significant alteration to the non-intervention strategy. Thus, the use of the development corporation concept in urban renewal could save the government some money' In the public sector, the government's effort in urban renewal also served more than one purpose. On the surface, the government's intention was to provide better housing for its tenants, however, considering the decaying structures of the early resettlement estates, their maintenance and management costs were very high Due to poor living conditions, it was hardly possible for the government to increase rent to cover the maintenance cost without meeting strong opposition from the tenants. Consequently, it was more profitable for the government to demolish these buildings and to rebuild anew. Again, Iand efficiency wourd be increased after redevelopment and the government could build Home ownership Blocks on redevelopment sites. To sell these fiats to public the would enable the government to generate more revenue. 70

8.,{m Evax¡¡ation of Fast {.rnhan Redevelop¡nent Efforûs

In the last three decades of urban redevelopment, the cityscapes of Hong Kong have changed considerabry. In some parts of Sheung wan, yau Ma Tei and wan Chai, Iiving conditions have been improved. Land efficiency has increased as more high- rise buildings have emerged in areas of redevelopment. However, urban redevelopment programs in Hong Kong, both in the public sector and the private sector, have still Ieft much to be desired.

First of all, in the 1960's when the government was pursuing the comprehensive slum clearance approach to deal with slum problems, economic efüciency was the main determinant of what was to be erected on the redevelopment sites. Therefore, granted the desirability of constructing new public housing estates on site, or in close proximity to rehouse the displaced tenants, the government failed to take this into account and this neglected the purpose of maintaining the strong social and economic ties of the community. Moreover, the government's limited intervention policy, as well as its cost and profit consciousness, made urban redevelopment subject to the fluctuations of the property market. owing to the fact that many of the redevelopments were undertaken by the private sector, developers would assume a wait-and-see attitude when the property market was at a low ebb. Therefore, it was not uncommon to see in the environmental improvement programs that many vacated premises remained undeveloped. Again, since the private developers were the main force in urban renewal, those areas most in need of redevelopment were often left untouched because of their unprofitability. Displacement and improper handling of small businesses were the main drawbacks during the first large-scale slum clearance in the I960's. Land cleared was often used for the construction of high-rise office buildings or expensive housing for middle-income or high-income groups. This led to a collective deprivation of the poor. 1I

Furthermore, the long time lag between the start and completion of the program may well have rendered it unviable- It would also have deterred investment decisions with the upshot of making the rest of the community deteriorate at a faster pace. For the

environmental improvement programs and the urban improvement programs, governmental support was halÊhearted. The recently established Land Development Corporation, if unco-ordinated and not supported by the government, might tend to put the emphasis on high-profile development because it has to be financially selÊcontained. Moreover, in some urban fringe areas, problems of redevelopment are significantly different from those in the main urban areas. A¡eas such as Kwun Tong, Tsuen Wan and Kwai Chung are traditional industrial areas of Hong Kong with their own sets of problems' Hong Kong is in the course of transforming itself into a financial and service centre, and therefore the importance of manufacturing industry has begun to dwindle. Realizing that they could earn more by investing in the building of residentialbuildings, some of the developers have begun to redevelop industrial buildings into residential premises. Such conversion is made possible because some factory building owners obtain leases with unrestricted user clauses and some of the areas in these industrial districts are not covered by an approved statutory outline zoningplan. Under such circumstances, new residential flats may be built amidst factory buildings, and although this is environmentally undesirable, the newly-formed Land Development Corporation,s jurisdiction does not reach these areas. Hence, it is impossible for the corporation to co- ordinate redevelopments there.

On the side of the public sector, it is doubtful that the underlying reason for redeveloping the older public housing estates was the government,s concern over the welfare of the tenants. According to some official sources within the Hong Kong Housing Auihorityzo, aithough displaced tenants could be at least rehoused in the same 70The informant requested her identity not to be revealed. 72

district, the rent they pay will more than double, perhaps even increase as much as six to seven times the current amount because both in-suite facilities and community amenities are better than the ones in the older housing estates. This may be acceptable for those who could afford the rent, but for the poor, it means that they have to pay higher rents

with curtailed spending for other needs.

Conclusior¡

This chapter has given a historical background to urban redevelopment both from the global perspective and that of Hong Kong, and there is a number of lessons

that can be learned from the past, each having a bearing on future urban redevelopment in Hong Kong. The following points have emerged.

l Urban redevelopment experience in other parts of the world indicates that urban redevelopment is not purely physical a rebuilding process. The concern of the affected community is very important. In the past, too much emphasis on economic development and the pursuit of increasing land efficiency has broken up communities and bred discontent' Resident participation is now incorporated in community redevelopment projects' Rehabilitation and measures that could preserve the original community are prefened. considering Hong Kong's renewal history, although there is a great improvement in the urban redevelopment approach, residents'participation in the redevelopment process is still found wanting. There are often complaints from the residents that they do not have enough compensation and are rehoused in an area that is not their choice. /J

2. A redevelopment approach ought to be flexible enough to be compatible with the

concerned community. On the one hand, redevelopment is ideally an approach to ameliorate the living conditions in an area, while on the other hand, it has to be realistic and applied in the context of the situation in hand. In the western world, urban redevelopment often occurs in the context of political conflicts, availability of funds, the ideology of the ruling political parfy, and cost effectiveness of the projects. Urban redevelopment is first and foremost a political practice. In order to deal with the lack of funding and keen competition among different government departments for funds, urban

redevelopment projects have shifted to tap private resources to redevelop dilapidated

areas. Hong Kong has begun to follow suit with the setting up of the Land Development

Corporation. However, there are significant differences between the society of Hong

Kong and that of western countries. In the first place, the most important job confronting

western planners is to lure private developers into carrying out jobs that are beneficial to

the community. In Hong Kong, this is also very important, but the most crucialjob for planners there is to find a way to have their redevelopment proposals approved by the central authority in 1997. As a regular practice in communist countries, redevelopment is centrally planned, controlled and implemented in a top-down approach. It depends on the planners'political skills to persuade the top government officials to accept their proposals.

Secondly, the development density of Hong Kong and that of most of the western urban centres is different. For many western countries, low-density development is the norm and the physical decay of housing is found to be the most serious cause of neighbourhood decline. However, in the Hong Kong case, this could only be solved by house clearance so as to give way to the construction of the necessary facilities. Therefore, what is good for the West may not be good for Hong Kong. Planners need to be selective in choosing their redevelopment strategies. 74

3. The government's support of urban redevelopment in the past was lukewarm. Urban

renewal started offwith the aim to solve the sanitary problems in some dilapidated areas

and then served as a means to acquire land for commercial office buildings. There was no

strong and genuine government effort in improving the living conditions of the slum

dwellers. In dealing with urban housing problems, the government chose to clear out the

squatters in order to acquire prime land to redevelop the blighted urban areas. A lesson

learnt from the past experience is that successful urban redevelopment needs the whole-

hearted support of the government throughout the entire redevelopment process.

4.On account of the problem of the fragmentation of ownership and high-density

development, it has been established that no small orgarnzation can carry out urban

redevelopment efforts effectively on its own. In 1974, the Hong Kong Housing Society,

as advised by the Hong Kong Government, carried out the Urban Improvement Scheme.

However, because of the financial constraints of the Society, the scheme it carried out was

not very successful. So future urban redevelopment depends very much on the partnership

of the private sector and the goverrrment.

5. Overcrowding, congested traffic, and a lack of community facilities are more severe

problems than physical deterioration in some parts of the older urban areas. Because of

the nature of these problems, it is more appropriate and more effective to redevelop an

area comprehensively, although this approach is out of fashion in the Western world.

6. In 1956, the relaxation of the plot ratio led to the burgeoning of 'pencil development'in the urban areas. The same problem may repeat itself with the anticipated relaxation of the building height restriction in areas around the Kai Tak airport. Private developers would be very interested in rebuilding some of the buildings to maximize land efficiency.

Measures and planning are needed to deal with the foreseen undesirable redevelopment. 75

7' Private developers were very keen to find loopholes in the law so as to bring the most benefits to themeselves. Since Hong Kong is evolving towards development as a financial and communication centre, and with the decrease in the importance of manufacturing industry, the private developers are beginning to convert some of the older factory buildings to residential uses. At present, these efforts are unco-ordinated and construction of residential buildings amidst factory buildings is environmentally undesirable. It is also noted that the present jurisdiction of the Land Development Corporation does not cover districts like Tsuen wan and Kwai chung, and the agency is not involved in the redevelopment of the industrial areas. In order to have a better urban environment, the Land Development Co¡poration should plan to extend its influence gradually to these urban areas.

The above points can serve as references for future urban redevelopment. However, before resuming this discussion and to broaden the context, a description of the planning practices in the neighbouring jurisdiction, namely in the pRC, is in order. This is the subject ofthe next chapter. 76

Chapten Five: Chima's Flanming System, Coastal Ðeveloprmemt Stnategy and Unham Redevelop¡mer¡t Fnactices im Major Chinese Clties

The first part of this thesis has discussed the factors that would affect Hong Kong's urban redevelopment in its normal course. This part of the thesis will deal with another concern of Hong Kong planners, that is the effect of China's take-over of Hong Kong on Hong Kong's urban redevelopment. The'China factor'that is going to impinge on Hong Kong's redevelopment future will be studied in this and the coming chapter. In this chapter, China's administrative and planning systems, its regional development strategy, housing policies and case studies of urban redevelopment taking place in three major Chinese cities will be discussed in the first section, while the effects of coastal development strategies will be discussed in the second section. The findings arising out of this discussion form the basis of comparison of planning and redevelopment approaches of Hong Kong and China, together with the construction of scenarios, which comprise the substance ofthe next chapter.

,4,. Ctrúna's .{dmi¡listrative Systern

China is run by the Chinese Communist Party and the State Council is the natiori's highest administrative organ. Under it, there are twenty-one provinces on the Mainland, five autonomous regions and three special municipalities, namely, Beijing, Shanghai and Tianjin. The levels of government according to size are: the nation, the provinces, the municipal districts, the county, the township, the national township, and the towns. Since 1979, four special economic zones were established as a result of China's open-door policy' These special economic zones are under the leadership of both the state 77

and their respective provincial governments. According to China's Constitution, the people in agregate has the greatest power and it is exercised through the National people,s

Congress and the local People's Congresses at each level of administration.

In general, the responsibilities of the local governments are: 1. to carry out the decisions ofthe State Council, the localpeople's Congress and the People's Congresses of higher levels, the state plan, the state budget and any government policy in general;

2. to ensure mobilization of local resources;

3. to carry out economic, socio-cultural and public security tasks;

4' to maintain and protect state-owned companies, as well as the properties of citizens; 5. to protect the right of rural collective economic organizations to make their own decisions;

6. to co-ordinate local level policies with state level policies.zr

Basically, public finance of China is centrally controlled. The national government sets the guidelines, policies and determine the expenditures for various sectors. However, the local governments can have some flexibility in levying surtaxes on agricultural land, industrial and commercial activities and public utilities. Therefore, the wealth of a local government depends on the number of enterprises and undertakings it controls. In addition, though the local governments cannot change the overall amounts for the various activities, they could adjust the amounts between line items.

7l Harloff' Eileen Martin and Wei, Cuiyi, 'Present day local governrnent in China,, planning and Administ¡ation, Vol.l6, No.2, Autum¡, 19g9, p.l l7. 78

ts. China's Regional Ðeveloprment Stnategy

In order to boost China's ailing economy, China has opened the coastal region for foreign investment with the intent of increasing China's competitive power in the international market. Market mechanism in the coastal regions was allowed to play a greater role with a view to import foreign high-technology and capital investment. A 'High Technology Research and Development'program was adopted in March l9g7 by the 5th session of the 6th National People's Congress, It was hoped that, through this initiative, China could keep pace with the high-technological development of the world. The emphasis on developing the coastal regions into freer economic cities originated with Deng's concept of 'acquisitive man'which replaced Mao's'new socialist man'. Since the coastal cities are the nearest to the outside world and have a longer history of port development, they are seen as natural growth poles for China's economic development, this was explicitly stated in the Seventh Five-Year Plan which identifies the objectives of the Government of China as follows: to 'speed up the development of the coastal region, to put the emphasis on energy and raw materials construction in the central region, and to actively make preparations for the further development of the western Íegionl2. In Maoist days, development emphasized the mitigation of disparity between the interior and the coastal regions' However, the new direction after 1978 put more stress on the use of comparative advantage. The new strategy has four components: (l) it assigns each region a special role, taking account of each region's factor endowments, (2) a series of preferential policies is granted to the coastal region, (3) present central government policy towards the poorer areas has been oriented towards the more pragmatic objective of enabling the poor to feed themselves, (4) the government has put its faith in the promised

7zYang, DaIi, 'Patterns of China's Regional Development Strategy", the China No.l22. June 1990, p.233. euarterly, 79

diffi]sion or'trickle-down' of growth from the coastal region to the other regionsT3. In order to compensate for the regional growth disparities that might result from the new coastal development strategy, the central government has encouraged regional co- operation through joint-ventures, domestic compensation trade, investment in the interior by companies from the coast, etc. Together with the implementation of the ,ladder-step doctrine'7a' economic decision-making power has also been delegated to lower-level government' The provincial governments now have more autonomy than they possessed during Maoist days.

C. China's Flanning System

Coinciding with economic reform, there came a new era of urban planning in China. Centrally-controlled urban planning was introduced in 1949. Inthe early years of the Communists'take-over of China, methods of city planning were by and large borrowed from the Soviet Union. The basic objectives of the Government were to transform the 'consumer city' into the'production city' and to rehabilitate cities all over China from the damage of the Second World War and the Civil War. At this time, the government saw its major task as building up the industrial base of China, so planning employed all means ,Gve to boost production A well-known slogan at that time was first to production, and second to livelihood'. In 1954, the principle of 'Three Services,was formulated at the First ,Three National Conference on Urban Development. The Services, were. (1) to serve proletarian politics; (z) to serve production; and (3) to serve the

Iivelihood of the labouring masses. It was also at this period that city planning

73Y^g, Dali, 'Patterns of china's Regional Development strategy,,, the china euarterlv, No. 122, June 1990, p.241. 74'ladder-step doctrine' refers to China's economic development strategy which give first priorifv of economic deveiopment to the coastal provinces, while the central andlnterior provinces will receive less attention at the beginning stage of economic development. It is anticipated that with the economic growth of the coast¿I provinces, economic development of China's interior rviit ue facilitated gradually. 80

otganizations came into being. However, in the period of 1949 to lg5T,standards for land use and construction were set so high that they were not achieved owing to adverse economic conditions. This concern with standards is in tune with the early Chinese Communist Party's desire to build up a new image for China. However, in l95g-60, when the'Great Leap Forward'occurred under the guidance of the'extreme left', planning lost momentum and urban projects were reduced in scale. In 1960, it was proposed that city planning was to be abandoned for three years. In 1965, for fear of an airborne enemy attack, development adhered to the principle of 'near the mountains, disperse and hide- out', which severely impeded the evolution of city planning

The ten years of Cultural Revolution from 1966 to l976,were the most devastating period for China's urban planning. Every city plannin g organization was disbanded' There were no directions for city construction. Illegal occupancy of land and buildings were a common phenomenon. It was only at the end of the CulturalRevolution in 1977 that there was hope for the new development of city planning. The government introduced reforms to modernizetheChinese economy and society. In March 197g, the State Council convened the Third National City Planning Conference and a document on the proposalfor strengthening urban development was unveiled. In 19g4, the State Council published the new 'Procedures of Urban Design', and the 'City planning Laws', which were the first basic legislation relating to city planning after the establishment of the People's Republic of China. Although the directions of planning in the post-197g era still accede to the'serving for production'idea, more weight is being given to the goal of improving the livelihoods of the people. The objectives attending the 'City planning Laws', as stated in the "Executive Summary" of the statues, \ /ere to plan the cities of China rationally and scientifically so as to make them modernized and highly-civilized socialist cities, and to ameliorate the living and production conditions in order to enhance economic and social development. 8l

In the'City Planning Laws', planning in China is split into Urban Overall

PlanningTs and Detail Urban Planning, representing different planning stages. Urban

Overall Planning is concerned with the integral development of all construction and its

effect on the nearby regions. The time-frame of planning can be either long-term (twenty

years) or a short-term (five years). The Detail Urban Planning deals with construction of

infrastructural facilities in a city. The guiding principles of planning in China aim to plan

according to the characteristics of the area, and to arrange rationally all activities and

construction within a city. All proposals are to be evaluated against the criteria of

economic benefits, social benefits and environmental benefits. The proposal that best

meets these criteria will be chosen. In China, economic planning and physical planning are

administered separately. Overall urban planning is administered centrally by the State

Council, under which there are the Planning Commission, the Economic Commission and

the Capital Construction Commission. The Planning Commission is in charge of setting

the overall economic goals and deciding resource allocation. It also guides ministries and

provinces in their planning work and drafts the National Plan. The Economic Commission

co-ordinates work of different sectors of the economy and the Capital Construction

Commission co-ordinates physical planning, design and construction. Usually, guidelines

determined by the State Planning Commission (SPC) are not quantitative. Rather, the

SPC ensures that all these guidelines are consistent with the national targets. plans are approved by the National Conference while final versions of the provincial plans are sent to the provincial governments for approval. However, co-ordination among the commissions and various ministries dealing with planning is poor. At the municipal level, urban policy is devised and carried out by the municipal government. The provincial

Construction Committee, a branch of the CentralMinistry of Construction, supplies the

Ministry of Construction with information about local and provincial needs (Fig.1a). Tsoverall Planning is a free t¡anslatron for the pRC administrative terminology. öL

THE STATE COUNCIL

THE MINISTRY OF CONSTRUCTION (oNE OF THE FUNCTTONAL MtNtSTRtES UNDER THE STATE COUNCTL)

THE THREE MUNICIPALITIES (crTrEs UNDEH THE DTFECT AUTHORITy OF THE CENTRAL GOVERNMENT)

CIIY DEPT. oF crry PLANNING ADMII.IISTRATION

Source: Harloff, Eileen Mafin and Wei, Cuiyi, "Present Day Local Government in China", planning and

Administration, Vol.16. No.2, Autumn. 1989. p.132. ô)oa

Generally, there are ten major goals determined by the Central Government in directing

urban planning in china. They are listed in order of priority below.

1. Stabilization of China's hitherto fast-growing populatio n at LZ billion by the year 2000.

2. Development of industry with the necessary infrastructure. This new industrial

development is to be located on the periphery of large cities or preferably in the smaller and medium-sized towns.

3. Provision of more and better housing.

4. Growth of large cities is to be restrained and deflected to satellite new towns. 5. Growth of small and medium-sized towns is to be encouraged to a maximum

growth of 300,000 people for municipalities and up to 200,000 for non-municipal

settlements,

6. Polarization between towns and country is to be reduced.

7. cities should be planned as an integral part of the region.

8. The quality of air and water is to be improved.

9. Conservation and restoration of historic sites and buildings is to be encouraged.

10. Tourism, both domestic and foreign, is to be increased.T.

76Bor, Walter, Planning planner, "Urban in China: from Mao to Milton Keynes", The Vol.7l, No.9, Sept., 1985, p.19. 84

Ð. china's Housing arad {.Irbam Redeve[opmenû strategies

Housing conditions are generally poor in China. A lgTg survey showed that, the average floor space available to the inhabitants of China's fifteen cities of over

one million was 3.9 square metres per capita, whereas the figure for the urban population

as a whole stood at 5.4 square metres77. The worst housing conditions were found in

cities of half a million to one million people, although living conditions in some model neighbourhoods that the government showed to outsiders were more adequate and of good environmental quality. The majority of the back streets of Chinese cities are filthy and stained with sewage and garbage. As has been shown in the figures quoted above, dwelling space for Chinese people is insufficient. Sometimes, several generations of a

family are cramped into a single house, causing severe overcrowding. Basic facilities are also inadequate for the urban population. Households may have to share a common

toilet. In Wuhan, one of the largest conurbations of China, only 14o/o of the Housing

Bureau's stock was found to be up to standards. Much of the rest was in a hazardous condition 78

Although some assert that the poor housing conditions in China result from

the tradition of allowing buildings to deteriorate to the point of collapse before any

remedial action is taken, the major cause may well be the Chinese national policy

adopted afr.er 1949. The Communist Farff had tried to increase housing supply in the 1950's, but it never really put its housing policy into place. Emphasis at that time was on

77 Kirkby, R.J.R., 'Urbanization in China: Town and Country in a developing economy 1949-2000 AD,. Columbia University Press, New York, 1985. p.175.

78 Kirkby, R.J.R., 'Urbanization in China: Tonn and Country in a developing economy i949-2000 AD,, Columbia University Press, New york, 1985, p.166. 85

the encouragement of industrial production Non-productive capital expenditures like housing provision have never received any real attention. They lost in the competition with other capital expenditures that generated production. In the 1960's and the 1970,s, when the Cultural Revolution was at its peak, no private individuals would dare to do any maintenance or repair work on their dwelling units because this would be regarded as selÊpromoting and bourgeois. So for some decades, private housing in China was left to deteriorate. What made matters worse was that when the Communists took over China, housing was regarded as a basic public service and, rent was therefore set at a minimal level. The government could never cover its building cost from the rental it collected, so there was little funding available for it to build new apartment blocks or

provide maintenance services to the fast-deteriorating building structures. A l9g0 survey of the Wuhan City Realty Company reported that an average household paid only 2.3%o of its monthly income for housing. The small amount collected was hardly enough

for the city Government to carry out maintenance and repair workze.

The turning point of china's housing provision policy and urban redevelopment policy came in 1978 when the first National Housing Conference was held' At this conference, it was resolved that China should speed up its provision of housing and ameliorate urban living conditions. The necessity to join the efforts of the central and local authorities and the participation of the state enterprises and individuals

in dealing with china's housing issues was also recognized. In china, housing

development is provided by four major sources, namely.

a. the state;

b. state owned enterprises;

c. collectively-owned enterprises; and

T9carlson, Eric, 'Housing finance development in China', p.22 86

d. individuals.

There should be incentives to induce these housing providers to carry out maintenance or

to rebuild. The conference also affirmed that private ownership is a correct

manifestation of socialist property relations and that it will redirect the provision of housing along a more rational economic basis. Housing stock was proposed to be

'commodified'. Under the scheme of 'commodification'so of housing stocks, rent and prices of dwelling units should reflect their real costs. Individuals are given incentives to

buy their own homes so that the State could retrieve some money and reinvest it in other

housing development or improvement projects. In 19g4, the china Housing

Construction and Development Corporation decided to accelerate the selling offof public housing. In order to obtain funds to maintain residential housing, a recent lease

contract was introduced. It is a contract between the housing management unit and the

resident. The residents pay rent while the managements take care of the maintenance of

the house. The management willthen carry out major repairs and restoration if they are required.

In terms of management, there are different organizations in each level of government administration responsible for housing matters. At the state level, there is

the Ministry of Urban and Rural Construction and Environmental Protection (MURCEp)

which was established in 1982. The Ministry's functions are:

a. formulation of policies, laws, decrees and regulations regarding urban housing

development and administration,

b. devising of long-term programs and annual plans and inspection of their implementation;

c. promotion of the interchange of advanced experience and techniques.8r 8o'Commodification'is a term used by the PRC to refer to the making of housing a commodity. The price of housing should at least cover cost and reflects the market condition of deman-d and supply. slibid, p.20 87

2. Urban redevelopment of China

with regard to urban redevelopment, it was neglected for the most part before 1980. City development at that time emphasized the extension of new areas. With respect to slum housing, China adopted a policy called "Maximum utilization and Gradual Renewal". Only those deteriorating buildings with historic value would have a better chance of redevelopment. As for the rest, buildings were used to their utmost and

barely maintained, this was particularly true of residential stock. In this vein, city

afflictions, such as inadequate supply of housing and environmental deterioration were common in Chinese cities.

China began to redirect its attention on urban redevelopment only after the

Third Plenum in 1978 as a result of change of party policy. At present, what concerns the Chinese planning authorities most is not the choice of areas to be redeveloped, but the speed and co-ordination ofthe redevelopment projects. It has been asserted by Chinese planning experts that unco-ordinated demolition and unplanned construction do no good to the community. Reconstruction and redevelopment should be carried out

with the economic conditions of the time in mind and on the basis of the economic

benefits the projects will generate. In 19g0, with rising economic and social development in China, different forms of urban redevelopment have been taking place in

different parts of China. Generally, the Chinese Government does not favour large-scale clearance. It believes that rehabilitation of old buildings would stabilize the supply of urban housing stock. Considering the limited resources at its disposal, China has aimed its urban rebuilding strategy towards improving the material and spiritual environment of the city rather than stressing high-profile developments. The elements of urban rebuilding include. (a) reananging the functional structure of the city and relocating oo Õô

polluting enterprises and industries, (b) ameliorating the poor living conditions of the deteriorating areas so as to provide better housing, (c) increasing the provision of schools, kindergartens, nurseries and rearranging or building new commercial areas to increase urban living standards, (d) improving intra-city transportation and enhancing efficient flow of traffic, (e) increasing the proportion of green space to promote good environmental conditions, (Ð improving infrastructure and providing public facilities, and (g) preservation of historic sites and buildings of architectural value. The Chinese Government favours the comprehensive approach to urban redevelopment and would regard relocation of industrial enterprises in the satellite towns and suburbs as viable alternatives to their siting in the urban areas. Environmental projects are also stressed. For example, in Zhongshan and Foshan, Guangdong, planning cadres spent more time and money then is customary in creating a pleasant environment for residents by applying proper residential and industrial planning. Generally, redevelopment in China takes place in conjunction with the rearrangement or development of other human and economic

activities, as shown by the eight typicar examples listed below.

a' The integration of technical reconstruction with the existing industries.( This would be the major direction of China's future urban redevelopment. This approach consists of the spatial rearrangement of the city to promote industrial productivity on the one hand while avoiding the mixing of industrial activities in residential areas on the other. The latter implies relocating polluting industries away from residential clusters in a specified time.) b. The integration of reconstruction with the city's transportation network. c. The integration of reconstruction with major construction projects. The integration d. of reconstruction with the redevelopment of old, or dangerous districts, and ofsquatter areas. 89

The integration e. of reconstruction with traditional commercial, cultural and

entertainment areas.

f The integration of reconstruction with the city's waterways and environment. g' The integration of reconstruction with repair of the city's roads and buildings.

h The integration of reconstruction with the preservation of historic buildings.sz

is It widely accepted by Chinese planners that city redevelopment should be carried out in accordance with the financial capabilities and the housing conditions of the

city in question. Therefore, different cities should have different yardsticks for redevelopment.

In order to have a better understanding of the actual redevelopment practices, three cities' redevelopment projects will be examined. These are the cases of Beijing, Shanghai and Guangzhou.

a. Beijing's urban redevelopment

Beijing, the capital city of the present government, has been a capital for centuries. posseses It a great number of historic buildings and houses that need to be preserved for various reasons. Among them are, as Li Zuwei, mayor of Anyang, Henan said, preserving " the and developing of traditional cultural help to educate people and

strengthen their determination to build their hometown", 83 as well as the thought that,

since historic sites attract tourism, they will provide the funds for further development of

the city. consequently, redevelopment of Beijing has been centred around the

82-,'summary on the Seminar of Urban Renewal Planning', City planning Review, Vol.62, No.5, Sept, 1987, p.7. 83Wang, Zhaolin and Pu, Yuntong, 'Presening cultura-l sites', Beijing Rer.ierv, Oct23,l9g9, Vol. 32. No.43, p.36. 90

rehabilitation of historic sites or residential units representing a heritage of ancient

Chinese living. Redevelopment began with the old imperial palaces, government offìces,

temples, gardens and major historic complexes. At first, traditional residential quarters

received no attention, but they became a concern of the Chinese Government recently.

Old courtyard houses were redeveloped or maintained to preserve their originality

because the Chinese found that repetitive form of squares in Beijing forms a unique fabric that needs to be kept. If these courtyard houses were not redeveloped in a well-

planned manner, they would disappear either through natural deterioration or through

unco-ordinated demolition and rebuilding which would turn these unique courtyard houses into monotonous and unimaginative apartment complexes. In view of this, some

of the courtyard houses are receiving priority in redevelopment, such as Shishahai, which

is an area well-known for its courtyard housing. In rehabilitating the courtyard houses, hutongs (alleys) would be renovated first and then the inner courtyards. Redevelopment incompatible with the surrounding environment, such as high apartment buildings, were not allowed to infringe the area's integrity. Other considerations of redeveloping the old courtyard housing of Beijing include: i' evolving a new courtyard system which combines the privacy of walk-up apartments and the sense of community in a courtyard house neighbourhood; ii. maintaining the basic community structure; iii. rehousing the residents on site in order to preserve the original community.

The environmental quality was also taken into account when redeveloping

Beijing The Chinese wanted to keep the city clean and beautiful, and leave sufficient space for landscaping. Therefore, the Provincial Regulation concerning Urban Renewal in Beijing stipulates that at least 25o/o of the width of a newly-built road in the capital should be reseived for green space, ancí landscaping should account for 25-30%o of the 9t

total area of a construction project, regardless of whether it is a residential or an industrial developmentsa.

contrary to the earry communist practice, Beijing is searching for new \¡/ays of redeveloping the city. A policy of "mass fund_raising, democratic management and self service" was adopted to tap private resources in redevelopment efforts' It is hoped that through a co-operative approach to redevelopment, the burden of the State, as well as collective enterprises, will be lessened. participation of the residents in the redevelopment process, will enhance their ultimate satisfaction with the results' Moreover, Beijing has been successful in introducing international ventures in the redevelopment of its urban areas, Thus, the chinese Beijing corporation for International Economic cooperation (BIECO), which is supported by experts from a number of Beijing institutions, was established. Through this corporation, the Beijing Government has attracted many western countries participating in Beijing,s

redevelopment projects. china has realized the importance of bringing in western ideas and techniques in urban redevelopment. l¡lr. zhangKaiji, an architect, said that ,,no breakthrough is easy in historic planning city and residential construction unless certain planning theories are borrowed from abroad and in-depth studies carried out into the

urban planning and design legacy of China"85.

b. Shanghai's urban redevelopment

shanghai is the largest industrial centre of china. However, it is also covered with slums and hazardous buildings up to 19g3, the municipal goverrlment had already demolished two million square metres of slums to make room 84-,'For a more beautiful Beijing', Beijing Review, June I4, i9g2, No.24, p.9. 8swu, Liangyong, 'Rehabilitation in Beijing', Habitat International, Vol. 15, No.3, 1991, p. 63. 92

for new construction. The poor housing conditions of Shangh ai canbe ascribed to the Iack of funding allocated to the city of Shanghai for municipal public works. Between 1949 and 1985, though Shanghai earned a total income of 400 billion yuan, the city

could only keep 10% of the revenue. The rest went to the State Treasury. However,

most of this l}Yo was not strictly assigned to city maintenance. Indirectly, it went

towards agricultural production due to the earry communist philosophy which

emphasized grain production. OnIy 30 million yuan a year86 remained for the city's

needs. The minute amount of money left was not even enough for the city to maintain its basic facilities. Hence, Shanghai is plagued with problems of pollution, traffic jams and housing shortage.

As in the case of Beijing and other cities of China, the turning point in

housing policy for Shanghai came with the Third Plenum of the Communist party. The

city was permitted to retain more revenue and carry out housing reforms. In 19g5,

Shanghai could retain 23 54% of its revenue mainly for the building and renovation of

urban facilities. In 1986, the State Council approved an overall development program

for the city. Shanghai spent 1.39 billion )ruan, a 35.2% increase from 198587, on public

facilities and infrastructure. Moreover, the city was also allowed to raise funds for urban

construction and enterprise modernization. Investment in construction has also

increased dramatically. In the sixth Five-year Plan period from 198 1 to 19g5, some 3.41

billion yuan went to housing, I 34 billion yuan to telecommunications and l.946billion yuan to public and city works in comparison with the total of 2.848 billion yuan invested in these areas during the fifth Five-year Plan (1976 to 1980). The built-up areas of

Shanghai have consequently increased. From 1950-80, new housing construction

amounted to over 23.13 million square metres, an area equivalent to that covered by old

::H"", Baocheng, 'shanghai t¿kes on a new look', Beijing Review, Feb. 29, l9gg, p.l9 87ibid, p.20. 93

Shanghai. Between 1981-86, another 25.6 million square metres of housing went up and

the city has planned to build a further 40 million square metres of new housing in the

near future88.

Besides new construction, the city of Shanghai declared at the Housing

Development Strategy Symposium held in Shanghai in 1986, that urban redevelopment

should be its major th¡ust and, the essence of redevelopment lies in rehabilitation rather

than demolition. In the old southern district, the most crowed area of Shanghai, the

government has embarked on urban rehabilitation projects. Houses which have

deteriorated beyond repair will be replaced with 4-storey apartment buildings, while

traditional 2-storey terrace houses, that are in relatively good condition but lacking in

basic facilities, will be remodelled and renovated. The works include strengthening the

interior space and providing a private kitchen and a flush toilet. The renovation works

amount to 50o/o of the cost of new construction. Though it seems that renovation is not

much cheaper than rebuilding, renovation is still preferred because it could maintain the community and stabilize neighbourhoods.

Shanghai has also tried to tap private resources for its redevelopment.

There are many overseas Shanghaiese who appear to be willing to contribute to

Shanghai's urban redevelopment. Like Beijing, Shanghai has invited experts from the

United States, Japan and France to give technical assistance. The ShanghaiHousing

Management and Scientific Research Institute has also been in co-operation with the

French Academy of Architecture to carry out renovation in a pilot area. The French

mainly provide technical advice and materials for the project.

c. Guangzhou's urban redevelopment tsibid, zl 94

GUANGZ}-IOU * HUrzHou

vÃCaO HONG KONG 95

Like Beijing and Shanghai, Guangzhou is facing tremendous urban problems. The inner city of Guangzhou represents only Z4Yo of the total area of the municipality, however, it houses over 60%o of the municipality's population, industrial enterprises, railway installations and port cargo facilitiesse.Trafiìc is congested and residential areas are overcrowded. As mentioned before, all urban repair and maintenance came to a halt during the periods of Great Leap Forward and the Cultural Revolution because at that time the government had adopted a policy of 'serving production first and livelihood later'. Guangzhou was no exception on this score. During that period, construction of roads, bridges, new residential buildings and public facilities in cities were regarded as serving the livelihood function. Therefore, no cities would

carry out maintenance works because these might be criticized by the central government. For th¡ee decades, housing stock in Guangzhou was allowed to deteriorate rapidly. The situation was further aggravatedby a severe increase in population without a conesponding increase of living space. New housing was only built when new factories were constructed. The new residential buildings would then serve as quarters for the workers for their life-times. As factories in the 1950's were built along the southern bank the of Pearl River and later along the river's other tributaries for easy transportation, new residential quarters were also clustered in the same location. Due to the backwardness of building technology and the lack of materials, these buildings have aged rapidly and need repair. However, Guangzhou, like Shanghai and Beijing, faces the same problem of lacking funds to carry out repairs to these buildings. The nominal rents that Guangzhou collects cannot even recover the costs and the residents do not have the capital carry to out renovation works because the low salaries they receive do not leave much for discretionary spending. Only those residents that have overseas connections are presented with a better chance for improving their living conditions. New overseas

8eXu, Xueqiang, 'Guangzhou: China's southern gateway', in 'Chinese Cities', edited by Sit, Victor. F.S., Oxford University Press, 1985, p.l8l. 96

Chinese villages were in built the northeastern part of Guangzhou, a well-known one is the Donghu Xncun (East Lake New Village).

The city has emphasized more reconstruction. In lg7l-lgTs,Guangzhou spent 1.6 billion yuan on urban reconstruction; In 1976-19g0,3 7 billion. The amount doubled again 1981-1985.e0 ,protect in The city planners of Guangzhou aim to the

environment, restructure the old city and provide more social infrastructure.,erThe increase in funding is owing to the fact that the city has been allowed to retain some of the fees for the services it provides, such as telephone and water. Moreover, since l9g l, the province of Guangdong has permitted eight major cities, including Guangzhou, to utilize 5% of the profit tax from commercial and industrial enterprises for urban infrastructural construction and to use up to 50% of its own budget surplus for such purposes. Since 1986, Guangzhou has been allowed to collect land rentse2. However, most of these reconstruction monies go directly to the restructuring of the industrial and commercial areas, the construction of hotels and convention places, and the balance which goes to improvement of residential areas is devoted mainly to the demolition of two-storey and three-storey buildings and their replacement with tall buildings over ten

storeys high in order to solve the overcrowding conditions. The development principle

of Guangzhou is'full utilization of potentials, reform and restructuring'. Moreover, Guangzhou is still at the inception stage of an economic take-off Construction works have not yet been standardized. Both newer and older techniques and workmanship of

acceptable and unacceptable quality are being employed in its urban reconstruction. Finally, residential redevelopment of Guangzhou is crippled by a complex bureaucracy.

90Vogel, EzraF ', 'one step ahead in China - Guangdong under reform', Harvard University press, Cambridge, Mass., 1989, p.208 ]]wr} we+ 'How to promote the economic superiority of Guangzhou,s municipality,, yangcheng Wanbao, Dec. 2, I 980, (Guangzhou Chinese Newspaper) 9^21u, xueqiang, 'Guangzhou: China's southern gateway', in 'Chinese Cities,, edited by Sit, victor, F.S., O.dord University Press. 1985. p.187. 97

Above the enterprise that carries out redevelopment, there are four administrative layers; namely, top officials, commissions and administrative ofiTces, bureaus, and largepublic corporations. The bureaucratic layers are slowing down the redevelopment pace of Guangzhou.

Although residential redevelopment in Guangzhou is continuin g at asnail,s pace at this moment' it does have a brighter future. First of all, the government is trying to rationalizethe housing provision policy. Rents, like in Shanghai and Beijing, are being set to reflect the real cost of housing. However, since workers cannot yet afford such a great increase in rent, housing vouchers are issued to them in order to cover a substantial

portion of their rent. Secondly, as the incomes of Guangzhou's residents are rising, it is anticipated that they will have more discretionary income in the future to carry out private repairs to their homes. Thirdly, banks are allowed to lend money to enterprises that have prospects of repaying loans from their own income; hence, the enterprise approach to redevelopment will become a possibility. Finally, as Guangzhou is the major entry-point into china, the centrar government may want to help the city,s redevelopment

projects in order to raise the image of Chinese cities.

The coastal development strategy has brought about good economic results to the coastal region. Take Guangdong as an example, the economy is growing faster than nearly any other in o/o the world - 27 .2 in I991s3. This province,s capital, Guangzhou, is flooded with every brand name of consumer goods, more than 85% of its households have refrigerators, and 90o/o have TV setsea. Guangdong alone hosts over 650á of all

93cibney, Fra¡k Jr., 'china province', g4Martin, 's Renegade Newsweek, Feb., r7, 1992, p.35. Thomas J., 'A New ctrinÀ wit¡out Borde¡s', Forfune, oct. 5, 1992, p.r25 98

foreign investment enterprises in Chinaes. In addition, the power to allocate resources, investment and budgetary responsibility has been decentralized and the relations between the central government and the local governments have been transformed from coercive to negotiative. Negotiation over the contracts with regard to revenues and responsibilities- sharing were introduced in 1976 and implemented nationwid ein 19g2. For example, Guangdong agreed to transfer a lump sum of I billion yuan per annum to the central governmente6. In return, it could retain more locally-collected revenues and have more flexibility in arranging its own spending. However, economic development has also triggered inflation. The inflation rate in 1988 was 26.7o/o. This rampant inflation rate has eroded the real income of the Chinese. A sample survey in thirteen cities reported that, in 1988,35yo of the families indicated a decline in real income due to price sþrocketingrz. This impacts on'salary earners'more than'wage earners'of factories whose earnings are compensated by bonus income. Therefore, the open economy not only increased the inflation rate but also widened the income gap among different groups. Moreover, not everyone in China would support the coastal development strategy, especially the hardliners and governments of the interior regions. They allege that the development of the coastal region has happened to their detriment and that their energy and raw materials are being exploited by the coastal region. They sell raw materials to the coastal region at state pre-set prices whereas the coast produces export-oriented and profit-making products at market prices. Thus, the coastal region is getting richer at the expense of the interior. Furthermore, the coastal development strategy also brought about a decrease in regional redistributive efforts. Central investment to the regions decreased from 66%o in

95Goodspeed, Peter and Sabatier, Patrick, ,'open 'The conflict between reform and repression: t]re door,, is little press slips rtuough'. world Review, March r991, vor.38. wì.:, p.zo i|t*i1'lT>o zhao, suisheng, 'From Coercion to Negotiation: The Changing Cent¡al-Local Eãonomic Relationship in Mainland China', Issues and Stud"ies, Vol.2g, No.l0, 1992,1.1g. 97chen, Kuan I', 'Economic Reform on Mainland China and Iis Future', Issues and Studies, Vol. 27, No.3, 1991, p.103. 99

1978 to 38o/o in 1984e8. Though the strategy aims at a 'trickling down, of development from the coastal region to the interior provinces, people argue that the transmission of growth is not automatic. As the coastal region receives various special privileges, it will only widen the gap between the coast and China's interior. China's western provinces may never have the opportunity of economic take-off. In Gunagdong, there are notable changes both in society and in the economy. Though the Communist party hopes that only investment is brought into China, western ideas and living styles have been slipping through the southern gate into China as well. As China grants more economic autonomy to the special economic zones and the coastal provinces, the party's control is loosened. There are indications that economic reforms have also brought about social and political changes in the coastal region of China, especially in Guangdong which has close ties with Hong Kong and Macao - the two places that have been most exposed to western influence as colonies of Britain and Portugal. Besides, Guangdong itself also had a long history of capitalist influence before China's "Liberation,, in 1949.

.4. T'he Effects of the coastal Ilevelopment strategy on Guangdong

With the increasing affluence of the Guangdong province, all kinds of problems endemic to capitalism have flourished as a concommitant of China's open-door policy. Crime and drug abuse are on the rise and com:ption is rampant. Economic reforms have released the long pent-up natural inclinations of the people of Guangdong: they are pragmatic, materialistic and enterprenurial. These attributes were repressed in the Maoist days, but have recently come to the surface once again. The province is proud of what it has achieved so far. Within a decade, Guangdong's economic growth has

ntY-g, Dali, 'Patte¡ns of China's Regional Development Strategy", the China euarterly, No. 122, June 1990, p.250. t00

created five million jobsee. new Its economic growth rate has even surpassed that of the boom years in Taiwan and South Korea.

' As a corollary of the new economic development, central control on Guangdong has been loosened. The State has delegated to the province the authority to make its own economic decisions. Though many enterprises are joint ventures between the Chinese government and foreign investors, the investors have complete freedom to hire employees and to run their own businesses. Political commissars have disappeared from the factories of Guangdong. State-run enterprises have come diminished from 90%

of the total to just over 35Yo in the 1990'sr00. In fact, the physical distance between the Central Government and Guangdong acts as a barier for the State in taking firm hold of the province. People in Guangdong also believe that, since they send tax money to the Central Government, they should enjoy economic and political autonomy. In fact, many investors in China scarcely feel the influence of Communism. Li Hong Kai, manager of a Japanese motorcycle retailer, said 'the party is here, but we really don't notice them'r0r, and John Kamn, an American chemical company executive who has done business with

Guangdong for l9 years, said"old-style communism is dead in Guangdongrr'2. young people in Guangdong have lost interest in political studies. They do not really care about what the communists do. Some Guangdong people do not even see why they have to follow instructions from the Central Government because they claim that they pay for everything, including the building and maintenance of the province's infrastructure and public facilities. Ting Wai maintains that the designation of SEZs is 'beneficial to the further opening-up of the economy, but might at the same time be detrimental to national ggcoodspeed, Peter and Sabatier, Patrick, ,,open 'The conflict between reform and repression: the door,' is still ajar, but littte slips through', world press Review, March 1991, vol.3g. p.ze . 100 Nì.:, Gibney, Frank Jr., 'chinaÈ renegade province', Newsweek, lolcibney, r,eb.iz, 1992, vol. t 19. No.7, p.35. Frank J¡., 'china's r.n.gãd" province', Newsweek, Febt.rT,' l02Tat:uet, l992,Vol.l i9, No.7, p.35 Andrew,'The mounûaini are high, t}reemporer i, i*u*uy', eorbes, August 5, 1991, Vol.l4g, No.3, p.70. i0l

integrity, as it may result in regional separatism. The problem is not very acute at present, but with the gradual opening-up of Kwangtung (Guangdong) and its further integration into the world capitalist system, control from the centre is likely to become more and more

difficult and the exercise of sovereignty may be limitedu03.

While the relationships between Guangdong and the Central Govemment were loosening, those between Guangdong and the other provinces took a turn for the v/orse' The success of Guangdong's economic development has aroused the jealousy of the other provinces. Guangdong has been exploiting much of the resources of the other provinces and able men and women from the interior provinces are being attracted to Guangdong by higher salaries. In order to protect their own interests, some provinces have set up inter- provincial trade barriers. This gives rise to a new economic 'warlordism'. Consider Hunan province: it has forbidden trucks f¡om Guangdong to export coal and grain.

In view of the loss of control over Guangdong and the creeping'bourgeois liberalism', the state has recently tried to regain some of its power. The SpecialEconomic Zones (SEZs), for example, could retain loo% of their foreign-exchange earnings at the beginning of the SEZ program, but now they can only keep 80% to4 and the state also tried to launch a financial austerity campaign to slow-down economic growth in 19gg. Credit that Guangdong needs to further its development was cut, while financial resources are redirected to the development of projects in other Chinese cities, such as the pudong project in Shanghai. However, recentralization cannot be accomplished abruptly because it may frighten away foreign investment. Once Guangdong was released, it has become quite difficult for the Chinese Government to regain control without incurring cost. The

103\Ã/^ai, Ting, 'The Regional and International Implications of the South China Economic Zone,, Issues and Studies, Vol.28, No.12, 1992, p.52. lOacheng, Elizabeth, 'Beggar Thy ñeighbour', Far Eastern Economic review, Jan., 19g9, p.45. 102

people of Guangdong are willing to stand up for their own rights. For example, when Prime Minister Li Peng tried recentralize to fiscal control over Gunagdong in 1990, the governor of the province, Ye Xuanping, dared to speak up against the notion, and gained the support of many other governors. It is especially hard for the central government to act decisively when the 400,000 state-run companies, which supply the government with 80% of its revenue, are runing at a loss, and in view of the fact that there is an unemployment problem in Chinese cities, which amounts to 4yoor g million people. As mentioned, the central government attempted to curtail economic growth and inflation in 1988 by implementing an'austerity policy'. Yet, while the inflation rate dropped from 25'5% in 1988 to 17.8o/o in 1989, the 'austerity policy' caused state enterprises to slow down, which led rise to a in unemployment. The increase in unemployment created discontent and un¡est in China. Therefore, the government relaxed up the ,austerity policy' at the end of i989 and finally abandoned it in 1990r05. All these events make the Chinese Government hestitate to come down hard on Guangdong which generates new

employment opportunities and foreign currency for China.106

Conclusior¡

In China, decentralization of authority is growing rapidly in the coastal region' Although the Central Government still formulates policies for the whole nation, individual provinces are acquiring more autonomy to make their own decisions. At first, autonomy was granted provincial to governments in respect of economic decisions, but now it is beginning to be extended to other social and political areas. As many investors have observed, Guangdong is now running almost along capitalist lines. Though the l05chen, Kuan I., 'Economic Reform on Mainland China and Its Future,, Issues and Studies, yol. 2i. No.3, 1991, p.l10. l06Goodspeed' Peter and Sabatier, Patrick, 'The conflict ,,open between reform and repression: the door,' is still ajar, but tiftle press slips through', world Review, March 1991, Vol.3g, No.3, p.26. 103

CommunistParty is still in charge, Guangdong has freed itself from Communist control in many respects. However, the discontent of the other Chinese provinces over the special privileges granted by the State to Guangdong and the Central Government,s attempt of recentralizing some decision-making power which has already been relegated to individual provinces are becoming an issue. If this continues to develop, it will affect greatly Guangdong's future. A cursory glance at China's housing and redevelopment strategies, indicates that there has been a great change in the approach that the Chinese Government has taken to deal with its urban housing problems, particularly since the capitalist approach was allowed to play a greater role in China. Subsequently, the Chinese Government has endeavoured to 'commodifu'the housing stock to make housing reflect more its real cost and let the government recover more money for new construction and maintenance the of existing stock. In redeveloping the urban areas of China, the Chinese government has begun to channel more financial resources, including money from individuals and private enterprises, into the redevelopment process. International efforts are also invited. Organzations like the BIECO and the co-operation between the Shanghai Housing Management and Scientific Research Institute and the French Academy of A¡chitecture are examples of inviting foreign expertise in urban development projects. China is trying to learn those lessons of the western countries that could be applied in the

chinese context. Expert advice from advanced countries are sought.

The Chinese Government also realizes that urban redevelopment has to be carried out according to the financial conditions of the city at the time. Except for areas where houses have deteriorated beyond repair, China has realized that home remodelling and rehabilitation are preferred to improve the living conditions of the general public. The Chinese Government would also consider preservation of the community and of the neighbourhood character when carrying out redevelopment projects. Arrangements for the on-site relocation of the displaced inhabitants will be made whenever possible. 104

However, residential redevelopment is still slow and of a lower priority in comparison with commercial and industrial reconstruction. The government has to determine ways to simplifu its administration in order to expedite the process and increase project efficiency.

Notwithstanding all of the above, owing to financial constraints

experienced by the government, redevelopment priorities in China are still directed towards areas that will yield the highest economic benefits. For instance, in the case of

Beijing, courtyard houses which are considered as landmarks are given priority of

redevelopment because. preservation of these houses will attract tourists and hence generate more foreign currency for China. The other residential areas, though they might

face the same problem, do not receive the same amount of attention. Because of fiscal

shortages, the government still adheres to a certain extent to the principle of 'maximum

utilization and gradual renewal'in its housing policy. Moreover, the urban redevelopment

pace of China is slackened by the complex nature of the Chinese bureaucracy. Generally

speaking, there is still no thorough planning for residential redevelopment in China.

The recent shift of China's policies brings about good prospects for Hong Kong's future urban redevelopment. First of all, the'commodification'of housing stock is

congruent with Hong Kong's trend of privatizing housing supplies. The promotion of the private sector and foreign aids in redeveloping the older urban areas of China make it easier for the Chinese Government to accept Hong Kong's tradition of relying heavily on the private sector to carry out urban redevelopment. Secondly, the decentralization of decision-making power from China's central body to local authorities and the recognition of the differences among cities and the encouragement of different cities carrying out urban redevelopment according to the conditions of the city are viewed implicitly as a favourable signal for Hong Kong to pursue its own path of urban redevelopment. 105

general, In this chapter has briefly described the recent changes in regional development strategies and housing policy in China. This may affect China's policy towards Hong Kong after 1997. An understanding of the Chinese situation gives rise to several questions. Can China's present policy towards the coastal provinces predibt Hong Kong's future governance? CanHong Kong make use of the situation of rising autonomy of the coastal provinces to obtain more autonomy from the central government? Will China impose its housing policy on Hong Kong and will the outcome be desirable to?

These questions will be addressed in the forthcoming chapters. 106

Ctaapten Six: E{ong Kong at the Cnossroads

In the previous chapters, Hong Kong's socio-economic conditions, its past urban redevelopment practices and China's urban restructuring have been discussed. In this chapter, the distinctive differences of urban redevelopment approaches between Hong Kong and China and the possible future political situation of Hong Kong will be considered

This chapter consists of three sections. Section one examines the socio- economic ties of Hong Kong with its neighbour. Section two discusses the differences between Hong Kong and China that would affect their choices of redevelopment approaches' Section provides three an analysis of the society of Hong Kong under different possible political situations. Though China has been undergoing rapid economic reforms, and has opened the door to foreign investment, the people of Hong Kong still worry that, someday, China may revert to its past hard-core communist rule. As has been realized, Hong Kong's fi:ture urban redevelopment hinges very much on China's attitude towards Hong Kong. In order to project what Hong Kong might be like after 1997, two scenarios will be constructed. One is the best case scenario and the other is the worst case scenario. Events affecting China's choice of the political route to follow and its attitude towards Hong Kong will also be discussed in this section.

Before Hong Kong was ceded to Britain, it was a part of Boa¿n county of Guangdong and large proportion of Hong Kong's population originates from Guangdong too' Not only do Hong Kong and Guangdong have close geographical and demographic ties, but the recent open-door policy adopted by China has enhanced their economic ties as 107

well' Their closeness is already giving people the feeling that the two territories appear unified even before 1997. Such an impression is in fact based on some solid grounds. Television sets in Guangdong are tuned to Hong Kong channels and even the watches of Guangdong people are set to Hong Kong time. Since television and radio broadcasts are received in the province, people in Guangdong have much knowledge about modern capitalistic living. Seeing that salaries and land cost are lower in Guangdong, many Hong Kong industrialists have relocated their factories there. Many of the Guangdong factories manufacturing shoes, clothes and stereos are owned by Hong Kong investors. In 1990, cross-border trade between Hong Kong and China amounted to more than HK$ 400 billion (US$ 50 billion)toz. Guangdong is almost a workshop of Hong Kong while Hong Kong supplies information and financial services for this southern Chinese province.

Conversely, China has invested a huge amount of money in Hong Kong in recent years in order to build up Hong Kong's confidence regarding its future. The Chinese International Trust and Investment Corporation (CATIC) has bought lZ.5o/o of Cathay Pacific Airways and30%o of Hong Kong's telephone companyros. The Guangdong Enterprises organization is operating a tourist agency arranging group tours of Mainland Chinese to Hong Kong, and its subsidiary, Guangnan Hong, supplies 600/o of theterritory,s vegetables and 90o/o of its pond fish. It has invested heavily in Hong Kong with purportedly 38 direct subsidaries and 42 branch subsidiaries in the colony. In 1990, the organzation earned a revenue of HK$ 25 billion (us$ 3.2 billion)ror.

There are also political contacts between the civil servants of Hong Kong and the government officials of Guangdong. In 1991, cross-border official visits

107 Cheng' Elizabeth and raylor, Michael,'Delta Force', Far Eastern Economic Revierv, 16 May, 1991, p.64). to*-' 'As close as teetÏ aad lips" The Economist. August 10. lggl, vol. 320. No. 771g, p.60 roe cheng, Elizabeth, 'Enterprising cadres', r- prrt.rrËäro*. iår"*, 16 May, 1991, p.64. 108

amounted to 50 from the Hong Kong side and 30 from Guangdong sideuo. Ting Wai avers that'Kwangtung (Guangdong) is also learning from or imitating Hong Kong. The "Kwangtungization" of Hong Kong is occurring hand in hand with the ,,Hongkongization,,

of Kwangtung Not only does Kwangtung want to follow the same development path as Hong Kong, the Shenzhen region even wants the right to enact its own laws, aiming to 'import' some laws from Hong Kong, especilly those related to financial managems¡1.'llr. In fact, the National People's Congress has given the SEZ legislative powers of its own.

In the near future, the connection between Guangdong and Hong Kong is anticipated to be closer with the completion in 1993 of the superhighway that runs between Guangzhou and Hong Kong. The new superhighway will cut travel time between the two cities f¡om four hours just to over one hour. In addition, the superhighway will be extended to Zhuhai near Macao, and a new highway is under construction to link Shenzhen to Huizhou and eventually to Shantou, in the eastern end of the province. A rail extension will run from Guangzhou to Shantou and the Guangzhou-Shenzhen railway will be upgraded to handle higher-speed traffic. All these transportation arrangements are planned to transform Guangdong-Hong Kong into a single entity and tighten the links between the cities in Guangdong.

Kong and China

It has been noted on a number ofoccasions in chapters 4 and 5 that there are marked differences in the planning systems and urban redevelopment approaches of ll0-, 'As close as teeth and lips', The Economist, August r0, 1tlw-ui, 1991, vol. 320, No.7719,p.22 Ting' 'The Regional and International Implicatiois of the South China Economic Zone,, Issues and Studies, Vol.28, No.12, 1992, p.57. 109

Hong Kong and of the People's Republic of China. Three of the differences that have been noted are expanded below:

1. After quarter-century a hiatus, planning in China resumed only after 197g, and city planning in China is still at the early stage of development. In the past, development in

China was usually carried out at the expense of the cities, and mainly geared for production. The livelihood issue was by and large neglected. There is, therefore, a serious backJog of urban and housing problems for the present government to deal with.

coincidentally with the resumption of pranning, the chinese Government was

implementing an open economic policy. In order to hasten china's economic

development, the emphasis of reconstruction is on the rebuilding of the commercial, industrial and tourism sectors. Residential redevelopment receives a lower priority. Only

buildings that are in danger of collapsing will have a better chance of redevelopment. Housing that requires no immediate action, or which is of little economic or cultural value, generally is neglected at this stage. Reforms which try to correct the irrational price

structure for housing units are given precedence in order to let the government recover more monies for the future maintenance and repair of the housing stock. In contrast, the

society of Hong Kong has become more affluent than in the early days of industrialization.

People's expectations have also changed with time. With basic needs fulfilled, people

demand higher living standards which include better places to live, greater accessibility to public facilities and an amicable neighbourhood. Moreover, Hong Kong's planning style did not evolve overnight: redevelopment programs have been carried out over a period of

three decades. Hong Kong has been changing its approaches to redevelopment in

accordance with the needs of the time and in correction of past effors.

2. There are still no formal channels established in China to elicit public input in its planning and redevelopment process. Plans are created and implemented arbitrarily through various government agencies, procedures which involve bureaucratic practices 110

and affect the timeliness of plan implementation. By way of contrast, the public

administration in Hong Kong has become more transparent and the planning system is

undergoing reforms geared at encouraging input from members of the public in the

planning process. At the same time, the Hong Kong people are better educated and more

accustomed to democratic ways, thus, given that the present trends do not change, the

people will gradually demand more participation in matters relating to them.

3. Private input to residential redevelopment is rare in China. The private sector is not

strong enough to take up urban redevelopment on its own. Most Chinese cannot yet

afford private housing without government subsidies. Because of this, private initiatives in residential development are impeded. However, private redevelopment in Hong Kong has

a stronger base. At present, private efforts have been better co-ordinated through the

Land Development Corporation. It is forseen that, in the future, under the assumption

that political change does not affect economic development, the private-public partnership

will still be a desirable alternative in urban reconstruction.

It is evident from the above discussion that the future urban redevelopment

of Hong Kong will be both better and different from its China counterpart. The differences

stem from the divergent approaches to urban policy rooted in different socio-economic

systems. First of all, China has just resumed urban reconstruction, and, like Hong Kong in

the 1950', the provision of basic housing is more important than housing improvement.

Since much of China's housing stock is badly deteriorated, demolition and rebuilding

seems to be the only reasonable appproach. In Hong Kong , however, large-scale clearance in the near future is not appropriate, once all the remaining sub-standard housing units are demolished and higher quality buildings are built. It is no longer advisable for

Hong Kong to follow the approach and speed of redevelopment oiChina, considering especially that the pace of residential redevelopment in China is impeded by a lack of ill

funding (Since most funds continue to be allocated to the reconstruction of the commercial and industrial sectors). Moreover, the living standard of Hong Kong is higher, and in addition to internal improvement to the housing units, people demand improvements to the external environment and a greater availability of facilities. Second, public participation in planning matters in China is rare, but planning in Hong Kong has begun to be more responsive to public inputs and, as the civic awareness of Hong Kong,s population is rising, it is preferable that Hong Kong's redevelopment process be more open and planners are under strong pressure to preserve the original community on site. Third, as mentioned in chapter four, private-public partnership is desirable as Hong Kong,s economy is based very much on the private sector. Tapping private resources in urban redevelopment can save the government money for other uses, especially the mega- proj ects currently underway.

Despite the fact that the urban redevelopment approaches of China and Hong Kong are so different, it is still possible for Hong Kong to pursue its own redevelopment path because the Chinese Government has recognized some redevelopment principles rhat expressly suit the Hong Kong situation. They are listed below. a'Different areas need different redevelopment methods. Areas that could be rehabilitated should be rehabilitated. Large-scale clearance and rebuilding anew are not suitable for areas where housing conditions could be improved through repair or renovation. b'The use of corporate and foreign finance and expertise in redevelopment efforts in a reality. c' The importance of maintaining communities and minimizing the scale of displacement of the tenants is acknowledged. d' The preservation of buildings that are of cultural, historic or architectural value and is conceded, as is consideration of environmental factors t12

However, the continuation bf the above said guidelines for urban redevelopment depends on the political philosophy of the polical leaders. This will also determine whether or not Hong Kong can follow its own redevelopment path. A great deal depends on China's willingness to keep its promise to leaving Hong Kong,s social, economic and political structure unchanged after 1997. The next secion will discuss the political prospects for Hong Kong and anticipate the possible working environment that is in store its planners.

Section 3: Scenario Construction

Ever since the take-over of Hong Kong became an issue, there has been an uncertainty as to whether the Chinese Government will keep its promises stipulated in the Sino-British Joint Declaration. Influenced by what the Chinese Communist party did in the past and events which have recently occurred, people hold different views as to the future: some are optimists while others are pessimists. This section will first examine the causes for these contradictory attitudes towards Hong Kong's future; whereupon, two

scenarios will be constructed based on:

1)people's optimistic view that China is under the rule of a mellowed, more democratic communist Party, that will leave Hong Kong more or less on its own; and 2) people's pessimistic view that China will revert to the rule of the hardliners who will try to impose a strong control over Hong Kong,s affairs..

,4. causes flor Feople's Eerief in .4n optimtstic F¿¡ture fon Hong Kong

l. The economic interdependence between Hong Kong and china.

china has always depended on Hong Kong to import foreign currency. since China adopted a more open economic policy, the economic interdependence between 113

Hong Kong and China has become more apparent. China invests heavily in Hong Kong in order to build up Hong Kong's confidence. The Bank of China has located more than 14,000 companies in Hong Kongrrz and the Chinese International Trust and Investment corporation has bought 12.5yo cathay Pacific Airways and 3o%oof Hong Kong's telephone companyl13. People assume that China will not be so foolish as to upset Hong Kong's economy, so that its investment in Hong Kong will be affected adversely' The economic interest of China in Hong Kong would make China hestitate to 'kill the goose that lays the golden eggs'. Moreover, economic modernization was identified as a national goal of China in the Third Plenum. The success of China's modernization depends very much on foreign technology and capital. About seventy percent of China's foreign currency comes through Hong Kong. If China steps in to interfere with Hong Kong's domestic affairs, it will only frighten away investment which would have detrimental effects on China's burgeoning economy. In addition, China,s policy is now more flexible and the government is more receptive to the different forms of economy existing now in China. As Frank Chingua mentioned in his book.

'china's leaders now say socialism must be adapted to suit each country,s own

characteristics. German ,,In sociatist Friedrich Engels is quoted as having said: my

opinion, the so-called 'socialist society' is not immutable but, like all other social

qystems, should be regarded as something changeble and reformab¡..'I15

ll21¡. China Challenge, p.3l ll3-, 'As close as teeth and lips', The Economist, August 10, 1991, vol. 320, No. 7719, p.60 Il4pt"t¡ ching is a Hong Kong-born journalist who has qpeciaizø in the coverage of china, first with tie'New York Times'and then with 'The WaII Street Journal'. In l979,he was nãmed n.l:i"g correspondent of 'The Wall St¡eet Journal' and became one of the first four American n"*rpup"", reporters to the based in China. l-l5c¡ng, Frark' 'Hong Kong ¿nd chrna-For Better or For worse', china council of teh Asia society and the Foreign Policy Association, New york, 19g5, p.67. 1t4

Similarly, the Chinese magazine 'Red Flag' claims "Marxism does not bind people hand and foot", saying further that:

' As long as our structural reform is conducive to building socialism with chinese

cha¡acteristics, to making our country prosperous and strong, and to making our peopre

rich and happy, it conforms *¡1¡ ¡4uoirrn'l 16

Furthermore, Chinese prominent leaders, such as Deng Xiao ping paid visits to the Shenzhen Special Economic Zone and reaffrrmed China's open market policy as the

major economic direction of china. Deng also mentioned that:

'Hong Kong is important to china's modernization effofs for many reasons. The one most mentioned is as a foreign-exchange earner for china. But Hong Kong,s

usefiiness goes far beyond that. Just as Western countries have long considered Hong

Kong a rvindorv on china. so china considers Hong Kong its window on the outside

world. From Hong Kong, china can expect to rearn modern management methods,

import western technologv and aftract funds for i¡yesl¡¡s¡1.'l l7

Because of these and other similar occurrences, some people believe that China will

not change Hong Kong,s present system.

2' To maintain Hong Kong's present system unchanged will serve as an incentive for reunification with Taiwan.

F1ank, 'Hong Kong and china-For Better 1tu"ltnt, or For worse', china council of the Asia society and the Foreign Poliry Associarion, New york, 19g5, pp.67_6g. Frank, 'Hong Kong and china-For Better l.ttg*nq, or For worse', china council of the Asia society and the Foreign Poliry Association. Nerv york, 19g5, p.60 115

Reunification with Taiwan is one of the main goals of the chinese Government. China has tried very hard to open constructive dialogue with Taiwan. However, the attitude of Taiwan is steadfast. It is very difficult to build up mutual trust between the two governments. Hence, the Special Administrative Region of Hong Kong (SAR) is proposed as a model to show Taiwan that 'one-country, two systems'is workable, and it has been reiterated many times as the only acceptable alternative to China. The attitude of the People's Republic of china towards Taiwan is apparent in a statement made by a source on September 19th, lgg0 in the South china Morning Post that,

'Beijing u'ants to make it clear to tle visitors that its stand on reunification - that is, the

model of "one country, tlvo systems" - will not change. The Chinese Government will

not entertain suggestions such as that made by the Taiwan premier Hau pei-tsun, that

unification be realized under the "one country, two regions"concept,.

china wants to succeed with'one country, two systems'in Hong Kong, so that Taiwan may be persuaded to join in.

3. China is under great pressure for change.

The collapse of communism in the ussR and Eastern Europe has alerted China to the fact that reform is necessary for the continuation of the party rule. Indeed, the world's political climate is changing. Harlan Cleveland, a former U.S. Assistant Secretary of State, U.S. ambassador to NATO and dean of the University of Minnesota's Hubert H. Humphrey Institute of Fublic Affairs, regards the present age as one of People Power. It is a "nobody-in-charge society". He maintains that totalitarian rule is obsolete, saying that: 116

'Both the Soviet and Chinese strategies of reform from-r,r,ithin were revolutions prompted-ând, their leaders hoped, managed from the top. But top-dou,n reform will

always be too little and too late, people" "the will all too easily get out ahead of the reformers, .... In the Soviet union, the people's insistence on choice and self-

determination has developed a life of its o*o.'l 18

In fact, though the chinese Government suppressed the people involved in the Tiananmen Incident, there are still sporadic and covert calls for more radical reforms in China

William E. Halal, a professor of management at the George Washington university's School of Busines and Public Management and Alexander I. Nikitin, director of the Centre for Political and International Studies, Soviet Academy of Sciences, aver that governments all over the world will face radical change. Both "old Capitalism" and ,,New the "old Socialism", will be transformed to Capitalism', and "New Socialism"lle thanks to the advance of telecommunications. They note that, although people's calls for reform have faced enorïnous obstacles, the move towards democracy is unstoppable. Gorbachev once said that "It is either democracy or social inertia' There is no other way"l20. Moreover, the Western countries have kept on pushing China for reform e.g they have asked China to adhere to the terms of the LrN Charter of Human Rights which it has signed. Therefore, both internal and external pressures might compel China to assume a more democratic stance in handling Hong Kong matters. llscleveland. Harlan, Age people power,,, ll9tt¡t* "The of The Futurist, Jan - Feb., 1992, p.14. socialism" and "New capitaliim" emerge from tïe economic and political realities of the Information Age' "New Socialism" refers to an advanced form of democratic, humane socialism. The ma¡ket mechanism is introduced to overcome ,,New the ineffrciencies of planned economies. Capitalism,, refers to the breaking up ofbureaucracies and the extension ofdemocracy by developing participative wjth workers, clients, other firms and government. fþ99*rzoHalal, william E. and Nikitin, Alexander I.,ì'one world,,, The Futurist, Nov. _ Dec., 1990, p.r2. t17

4' optimists, who have confidence in chinese rule, think that china does not need to make use of the take-over of Hong Kong's sovereignty to change Hong Kong,s system. Since, Hong Kong does not have strong armed forces, it is very easy for china to take Hong Kong back without great effort. Even at the peak of the cultural Revolution when the People's Liberation Army came to the border, it did not enter Hong Kong and respected its sovereignty because it was realized that Hong Kong serves an important function which could not be replaced by any other port city of China' In fact, china need not use force to take back Hong Kong, and had it merely asked, Britain would have returned Hong Kong to china because it is generally understood by other nations that Hong Kong is a part of Mainland china. so, the optimists believe that china wourd like very much to maintain Hong Kong,s present situation in order to support the development of China.

5' China has a good record of respecting international agreements. Actually, China has never reneged on any internationar treaties it has signed. ts. causes for Feopre's tserief in a Fessimistic Future for Ï{ong Kong

1. The unpredictability of China's politics.

The Chinese government will not always make clear into real political aims. This may be in keeping with an old Chinese proverb which says that ',one will always win by catching the others by surprise". An example of china's unpredictable politics was the avowed intention to reinstate zhao ziyang within the political structure of China in 1992,but the proposal was dismissed at the end of the same year. The immense power of individual political leaders constitues another worry. As Frank Ching relates: ItB

'China is not yet regarded as politically stable. This is true not because China is a communist country but rather because it is an Asian society with a tradition of

autocratic rule'' and he goes on : "In China, poliry is still more important than law and

policies are often formulated by individual leaders who rely on their personal influence

rather than the oftice they hord to carry the day. In the long run, whether Hong Kong

will prosper depends not so much on what laws and regulations are written down on

paper as on how China perceives its own interest. For Hong Kong to sunive more or

less in its present form, it is more important that the territory continue to meet China,s needs than for the Joint-Declaration on Basic Law to conform with the .onr¡i¡u1ion.,l2l

Although local authorities are delegated with some power to make their own economic decisions and the central-local relationship is evolving towards a

'federal system without a federal constitution'122, decent ralizationof power in China is still a grace not a right. No one has guaranteed that it would not be taken away in the future' By the same token, though the Sino-British Joint Declaration states that the present systems of Hong Kong will not be changed, the pessimists still worry that China would renege on its promises once it sees its interest in Hong Kong disappear or for whatever other political reason.

2. Disagreement between Hong Kgng and china regarding the arrangement after 1997.

rhere have been disagreements between the two governments over alrangement after 1997: first over the construction of the new airport, and then over the democratic political reforms of Hong Kong. The threat of the chinese l2lching, Frank, 'Hong Kong and China-For Better or For Worse'. China Council of the Asia Society and Policy Association, New york, 1985, p.77. 1fftz¿ l9reiry zhao, Suisheng, 'From coercion to Negotiation: The changing central-Local Economic Relationship in Mainla¡rd China', Issues and Studies, Vol.2g, No.l0, tSlZ,f,.Zí lt9

Government to set up its own political structure in Hong Kong even before 1997 if the Hong Kong Government does not abandon its political reform proposals has already upset many Hong Kong people and made them doubt China's credibility in keeping the society of Hong Kong unchanged after 1997.

3. People have no con-fidence in the poriticar culture of china.

Some people believe that the real threat to Hong Kong's future is not communism but the political culture of China which is characterized by its inwardness and backwardness. China has always been sceptical of foreign influence.

Quoting what Ian Buruma says:

' To the Mandarins in peking' often men from china's poor interior, Hong Kong represents everything they loathe: it is southern, urban, subversive, r,ice_ridden,

rich, relatively free, and, above a[ fuil of foreigners and their poltuting foreign

ways. It is, in short, homibly un-ç¡in.r..,123

The arrogance of the chinese, together with the dispreasure of the interior provinces towards the growth of the southern coastal cities, constitute possible

pessimistic views about the future of Hong Kong.

4. Problems associated with the open-door policy

Since the opening up of China's economy, all types of problems associated with capitalism are thriving in China. Inflation is rampant, crime increases and capitalist ideas and thoughts have slipped in through the open cities. As a result of the infusion of market effects into planned a economy, there is a dual-prices system in China, which

123Hick, George, 'Predictable catastrophe-Book pacific Reviews', Asian Economic Literatu¡e^ Vol.4, No.2, Sept., 1990, p.104. 120

causes corruption and economic disorder. People believe that without serious political reforms, China's economic development will not go far. There have already been calls for transformation of the political system of China. AII these problems may drive the Chinese Government into abandoning its present economic policy so as to avoid a

'peaceful evolution' from socialism to capitalism.

C. Scenarios of'ffiong Kong's F'uture

Due to the uncertainties ahead, two scenarios built around Hong Kong,s most likely future are considered in anticipation of possible Chinese policies. It is worth saying at the outset that the demise of Communism in China is immediately dismissed,

because this is not a very probable event in the foreseeable future. This leaves two possibilities. One is based more on the optimistic view that China will introduce substantial political, economic and social reforms in response to a rising call for democracy' Both internal and international pressure are envisaged as potential forces which could oblige China to carry out substantial reforms in order to strengthen its rule and to appease the people. Therefore, Scenario One is constructed under the assumption that China will undergo radical democratic, economic and social reforms and that, in consequence, Hong Kong ,state will acquire more political independence and will have to state'relationships with the PRC. Scenario two is based more on people,s pessimistic view that China will fall into the hands of the hardliners. China will exercise strong central control over state matters. It is hoped that the scenarios presented will provide some parameters for future decision-making, particularly in the area of urban redevelopment. Basically, the parameters in this chapter are chosen f¡om the important facts and trends discussed in former chapters; trends derived from literature and articles pertaining to Hong Kong's future development, newspaper clippings and interviews conducted by the author. t21

The scenarios will cover aspects concerning Hong Kong,s society, economy, planning and relationship with china' Moreover, the fifty-year span of the transitional period is divided into th¡ee phases: the pre-transitional period, from now till1997;the early transitional period, from 1997 to 2021; and finally the late transitional period, ftom 20zz to 2046. The dividing line of 25 years is chosen because it needs this period of time to acquaint the new generation with socialist ways, so that future leaders of Hong Kong could be more receptive to Communist principles. In devising the scenarios, the author has chosen to present not only highly probable events, but also some that are less likely to occur, but yet are possible and important developments. The scenarios are presented in tabular form. lssue Ðesignatiom Fneser¡t sit¡¡atiom Scenan'io n Scer¡ario 2 A.Political Situation

l. Democratization

Opportunities and Constraints: There has been direct election From now till 1997 From now till 1997 in the three tiers of China will be firm in its stand There is a political China would not make any struggle government; ie, the Legislative of forbidding the Hong Kong concession to the number inside the Chinese political Council, the of Urban Council Government to allocate all arena between the reformists directly elected seats in the and the District Board. seats of the Legislative and the conservatives. Legislative Council, and Who However, in order to preserve Councilthrough direct would forgo its economic will take over the rule the amicable relationship election. However, the interest for its political determines the democratic between stand. Hong Kong and proportion of seats in the future of Hong Kong. The China, two-thirds of the seats Legislative Council allocated reformists seem to have won of the Legislative Council are by direct election and indirect the l4th Congress of the still allocated to councillors election is still subject to Communist Party of China in elected indirectly. The Hong negotiation and political deals 1992 In the congress, the Kong Government's recent between the British and the politburo shed eight elderly proposed political reform is an Chinese Governments. members and added 14 attempt to make all seats in younger ofücials, including the Legislative Council elected From 1997 party ro 2001 From 1997 ro 2001 secretaries from coastal directly before 1995. The reformists of the Chinese The conservatives cities that are practising open However, will tighten this proposal has Government will allow Hong economy. However, their supervision over the there are met with strong opposition Kong greater autonomy. Legislature of Hong Kong still uncertainties about the from China. to China's restriction over make Party's future once some sure that the so-called of the HongKong's political prominent reformist freedom dissidents who have spoken will be loosened with time. overtly against the Central China respect will its promise Government of China before

122 {ssue X}esignatiorn Fresernt Situation Scemario I (contrd) (cont'd) Scemario 2 (cont'd) (cont'd) leaders pass away. The delay that there will be no significant 1997 of the announcement of Deng get no access to the changes to the present system. Legislative Xao Ping's visit to the Council. Shenzhen economic zones and From 2022 to 2046 From his firm stand on continual 20ZZ to 2046 China's political system has Though open economy hints that Hong Kong is allowed become more democratic and diversity in political philosophy to have its own political Hong Kong has also prepared still exists within the party.. system, the Central to return to the mainland Government requests system. Hong Kong can still everything to be approved by have its own law and order. the State first. 2. Government Intervention

Opportunities The and Constraints: Hong Kong Government From now till 1997 is practising From now till 1997 a positive non- Hong Kong will continue to a. The Sino-British interventionist Hong Kong will continue to Joint policy practise the positive non- practise the positive non- Declaration stated that the interventionist policy. interventionist present social, economic and policy political situations of Hong From lg97 to Z0Zl Kong will remain From 1997 to Z02l unchanged; The Hong Kong Government More intervention; policies will be left to its own devices b. There are voices may be manipulated by the in China However, seeing the asking for a separation Chinese Communist of the inadequacy ofservices to the State and Party; Government. poor, the Hong Kong c. However, there is another Government will be involved force that calls for a more actively in public matters, but the market

t23 Issue Elesignatiora Fresent Situatiom Scenanio n (cont'd) (cont'd) Sce¡ranio 2 (cont'd) (comt'd) recentralization of decision- mechanism will still set the making to the Party at work in tone for private investment China and public construction.

From 2022 to 2046 Frcm202?to 2046 The Hong Kong Government Central influence on Hong will give private developers a Kong's domestic affairs will free hand as long as they do a become more apparent. good job.

3. Judicial System

Opportunities From now till 1997 and Constraints: Hong Kong's Judiciary is From now till 1997 The present system independent of the Executive The present system will will continue a. The Sino-British Joint and Legislative Systems. continue Declaration stated that the People who are dissatisfied present social, economic From lg97 to 2021 and with a judgment by a court can From 1997 to 20Zl political Though the present situations of Hong apply for an appeal. Court There will be no change to the legal system will continue, Kong will remain unchanged. cases arejudged upon present system except that lawyers b. judicial and judges will have China's system is established laws and court judges are appointed to make reference based more on the rule of precedents. locally and the final court of to Chinese laws in people handling court rather than on laws. appeal will be situated in Hong cases. c. There is no formal Kong. procedures of appeal in China. From202Tto From 2022 to 2046 2046

124 Xssue Ðesigrnatiom Fresent Situation Scenario n Scemanio (cont'd) (cont'd) 2 (cont'd) (cont'd)

The situation willbasically be Rules of law will be subjected the same as the period of 1997 to the interpretation of the to 2021 Party. The final court of appeal will be moved to Beijing 4. Hong Kong-China Relationship Opportunities and Constraints: Hong Kong depends on China From now till 1997 From now till 1997 for its supply of cheap food, Trade between Hong Kong a. Hong Trade between Hong Kong Kong's reversion to raw materials and fresh water. and China will increase as the and China will decrease China will tighten the ties Meanwhile, China relies on super highway will be gradually between the two places. as China tightens its Hong Kong to import foreign completed in 1994 which will economic growth in its coastal currency and establish trading further cut transportation cost cities. b. China's continual There will be fewer open relationships with countries for goods travelling between cross-border visits as economy will render a the big that China does not have China and Hong Kong, and Chinese Government has market for Hong Kong's normal diplomatic relations China will continue to be already been financial services and facilitate alarmed by the with. There are 750 Chinese Hong Kong's major trading Hong Kong's excessive influence of Western industrial companies with ofüces in partner. restructuring capitalism. by absorbing Hong Kong. Together they some of Hong Kong's labour- have invested more than intensive industries and by US $ l0 billion On the other From 1997 to 20Zt providing From 1997 to 202t a favourable hand, according to Xinhua Though Hong Kong is under China will extend its control environment for Hong Kong News Agency, there are two the Central Government over to further develop Hong Kong. More its million Mainland Chinese administratively, Hong Kong Chinese officials will come working for Hong Kong and Guangdong will indeed over to Hong Kong to teach

125 [ssue l]esignation Fnesent Situation Scenario I Scema¡.io (cont'd) (cont'd) 2 (cont'd) (cont'd)

communication and companies. Ofücial visits become an economic entity. people transportation technology. the Communist ways of between the two places have They will unite on a common doing things and c.However, if China tighten its increased mass media and all kinds of front to bargain for more policy on coastal development. of Hong Kong will have to go Western information and ideas autonomy from Hong Kong will the Chinese through a stricter screening be affected slip into China through Hong Communist Party. process. The Central adversely. Kong. government will try to cut d. There is a super highway down contacts between Hong Kong under construction which will and Guangdong. link Hong Kong and From2022 to 2046 From2022 Guangzhou together, cutting to 2046 Guangdong, with its Hong Kong's travelling time between the society, dynamism has surpassed the economy two cities from four hours to and political system economies of many newly- just over one hour. will have been transformed to industrialized countries in be more compatible with the South-east Asia, Hong Kong mainland counterparts. Hong and Guangdong will have in Kong is mainly an entrepot for fact become fused into a single China. economic entity. 5. Economy

Opportunities and Constraints: Though Hong Kong's From now till 1997 From now till 1997 economy remains good, it is Hong Kong's economy will a.Economies in the Asian facing The trend will be more or less challenges of : grow slowly, though its replicate Pacific Rim are growing l. protectionism scenario 1 and trade volume of trade with China quickly, Hong Kong can co- barriers imposed on Hong will grow steadily in the light Kong products by the of China's booming economy.

126 Xssue Designatio¡l Fresemt Situatiom Scemario tr Scemario 2 (conûod) (comt'd) (cont'd) (comt'd)

operate with the other developed countries; From 1997 to 20Zl From 1997 to 20Zl economies to build up a 2. keen competition from the Foreign investors regain their China' economic growh stronger economy for the fast-growing is South-east Asian confidence in Hong Kong. whole region. controlled. Hong Kong is economies; Investment both from adversely affected by b. There are two economic 3. China's foreign investment in Hong abroad and China increases. views in China. slower-growth economy ( due On the one Kong is stagnant. While the Labour-intensive i ndustries to the economic philosophy of side, some political leaders like void has been filled by the continue to move into China the hardJiners). Deng Xiao Ping applaud the huge Chinese investment in and Hong Kong will go on economic achievement of the recent years, it also implies developing into a better coastal provinces and support that Hong Kong has to depend service and financial centre. continued growth. On the on China for its economic other side, conservative future. leaders want to restrain From 2022 to 2046 From 2022 2046 economic growth of the to Hong Kong's economy is well- Hong Kong coastal provinces and will only be a developed, and serves as a financial centre for disapprove of the party's open- China. financial centre for China and economy. Growth is far behind its East Asia South-east Asian counterparts.

6. Standard of Living

Opportunities and Constraints: Hong Kong people enjoy a From now till 1997 From now till 1997 living standard comparable to The present living standard a. Hong Kong's future living The present living standard some moderately-developed will probably continue. will probably continue. standard will depend on the European countries. Inflation will be stabilized, Inflation attitude of the Chinese However, will be stabilized, inflation is rampant since countering it is one of since countering it is one of the government's policies . the government's policies .

127 lssue Hlesignatiom Fresent Situatiorn Scenario I (cont'd) (cont'd) Sce¡nanio 2 (cont'd) (cont'd) Government towards the From 1997 to 20Zl production of consumer From 1997 to 20Zl Due to the continuation goods. of Due to a cutback on China's China's openness, Hong economic development and Kong's living standard will b.The mega-projects of Hong be the loss ofconfidence of maintained; completion Kong will trigger offfurther of the foreign investors in Hong mega-projects will inflation. enhance the Kong, the living standard of living environment of Hong Hong Kong is anticipated to Kong and promote further be lowered. economic development.

From2022 to 2046 From 2022 to 2046 The living standard of Hong Some of Hong Kong's Kong will rise constantly. earnings will be transferred to the Central Government to subsidize the less-developed provinces. Less-luxurious buildings will be built and the pace of urban redevelopment 7. Population work will be slackened.

Opportunities and Constraints: a.The population growth rate From now till 1997 From now till 1997 a. Both Hong Kong and China is 6Vo per annum. The trend is similiar to the are encouraging small The trend is similiar to the families. b. out-migration from Hong present situation. present situation.

128 {ssue Ðesignatiom Freser¡t Situatüo¡l Scenario I Scemario (cont'd) (cont'd) 2 (cont'd) (cont'd) b. China restricts its citizens' Kong to other countries is From 7997 mobility. to Z02l From 1997 to 2021 escalating. Emigrants are The population irrcrease rate The emigration rate will mainly young professionals remains low. Those who have become stabilized because and the rich. Emigration emigrated before 1997 will those who could leave will amounted to about 1,200 begin to come back because have left. A considerable people per month throughout they see the growing number of Chinese 1991. development potential in Hong Government Officials come in Kong. As transportation to take over key posts in c. The number of marriages between Hong Kong and various organizations. decreases and co-habitation is Guangdong becomes more However, a large influx of becoming a dominant life-style convenient, Guangzhou, immigrants from China is not Shenzhen and some nearby expected because to control Guangdong cities will become the size of major cities is one suburbs of Hong Kong . of China's national goals.

From2022to 2046 From 2022 to 2046 The population of Hong Kong The Chinese Government will will be stable. restrict the out-migration of Hong Kong people to the other countries. The population of Hong Kong will be stabilized.

129 Issue Alesignatiocl Frese¡lt Situatior¡ Sce¡ranio I (cont'd) (cont'd) Sceraario 2 (cont'd) (cont'd) 8. Society

Opportunities and Constraints a.People of Hong Kong are From now till 1997 a.Civic education From now till 1997 is taught in generally apolitical and The situation will be more or The situation Hong Kong schools. asocial. will be more or less like the present. less like the present. b. Corruption in Hong Kong is b. Every students in China has less obvious than in the From 1997 to Z02l to take political lessons. Frcm 1997 to 2021 mainland counterparts because Hong Kong will be allowed to Hong Kong's curriculum there is the Independent in continue its own curriculum in c. Corruption is common civic education will be in Commission Against civic education. China. Corruption is scrutinized by China. Comrption set up in Hong more apparent as Hong Kong Comrption Kong is apparent. to investigate deals more with Mainland comrption cases. China.

From 2022 to 2046 From2022 to 2046 Corruption will be less severe Students are taught about than in the period of 1997 to Communism. Corruption is 2O2l because China will also still apparent. have tried to combat corruption. 9 Public Administration

Opportunities and Constraints: There are different From now till 1997 From now till 1997 departments More or less within the like the presenf More or less like the present. a. China's administrative government responsible for system is very bureaucratic. From different admini strative 1997 to 2021 From 1997 to 2021

130 lss¡¡e HlesÍgnation Fresent Sitr¡ation Scenanio I (cont'd) (cont'd) Scemanio 2 (cont'd) (comt'd) b. In order to have functions. There are different In addition to maintaining administrative the Since China will have a tight efiñciency, one administrative procedures present administrative system, control over Hong Kong's should establish some kind of established for Hong Kong different tasks will also have to domestic matters, every Guanxi (connection) within report and works. Public to the Central Government important administrative China's bureaucracy. administration of China. Moreover, maintaining of Hong Kong decisions of Hong Kong will have a good can be said to be bureaucratic working relationship with to be approved by various China but it does not emphasize as will definitely help Hong govemmental agencies of China. Kong much'guanxi' as Mainland obtain approvals from A good 'guanxi' with Chinese the China. State. officials is necessary in order to obtain administrative efficiency.

From2022 to 2046 From 2022 to 2046 The situation will be more or The situation will be more or less like the period of 1997 to Iess like the period of 1997 to 2021. 2021 10. Planning and Urban Redevelopment

Opportunities and Constraints: a.There are mega-projects From now till 1997 From now till 1997 undertaken on the western The planning system will The planning system will a. China does not have formal side of Hong Kong. become more transparent and channels established for become more transparent and the open to the public. As directed open to the public. As directed public to voice their opinions b.In 1989, the Land by the development of the regarding planning by the development of the issues. Development Corporation was mega-projects, the gravity of mega-projects, the gravity of founded to co-ordinate private urban development will be urban development will be

l3l lssue Ðesigmation Fresemt Situatior¡ Scenario I (cont'd) (cont'd) Sce¡ranio 2 (cont'd) (comú'd) b. In the past, housing urban redevelopment in Hong shifted to the improvement west. shifted to the west. was regarded as Kong while the government selÊpromoting and bourgeois. takes care ofthe From 1997 to 2021 c. In the From 1997 to 2021 past, urban design of redevelopment of the public As the relationship between Public participation Chinese cities emphasized housing in Hong estates which are Hong Kong and Guangdong routine design and neglected Kong's planning will receive deemed to be structurally becomes closer, environmental development no further development. considerations. unsound or of high of Hong Kong will take the Urban development Construction was to serve maintenance will be cost. development of China into production mainly. slackened in order to avoid the c.Planning of Hong Kong account. Hong Kong will development the d. The rapid urban takes account of coastal of probably retain its own cities construction in major Chinese extending too far ahead environmental effects. The planning system cities with minimum of that prevailing in the has already aroused, the designation of Hong Kong's jealousy intervention from the Chinese interior provinces. of China's interior water as water control zones Government and planning will Construction provinces and some Chinese will aim at is envisaged to save Hong be a means both Officials to enhance serving production first and favour slowing down Kong's water from excessive production and improve the Iivelihood larer. planning the development pace of the contamination. will living environment and coastal cities. well- take little consideration of being of the residents of Hong local communities and Kong and the involvement of neighbourhoods if the projects the private sector in the in question are deemed to be redevelopment process will beneficial to the whole city or still be considered a viable and nation at large. desirable aspect.

From2022 to 2046 Frcm20ZZ to 2046 The situation is anticipated to Planning will gradually be put be the same as the period 1997 under the jurisdiction of the to 2021 State Planning Commission.

132 nssue Ðesignatiom Fnesent Sit¡¡atiorn Scenario X (cont'd) (cont'd) Scemanio 2 (cont'd) (cont'd)

China will give directions and design guidelines for Hong Kong's planning matters.

133 134

Comctru¡sior¡

Hong Kong is expected to be integrated into the Guangdong system in the normal course of events; the two places together will control most of china,s foreign investment' The bargaining power of Hong Kong and Guangdong will rise if the two places stand as one and this is very probable in view of the recent development of Guangdong' The Guangdong region will then be expected to achieve more autonomy. As a result of differences in the economic and social systems of Hong Kong and china, it appears that Hong Kong is better able to pursue a redevelopment path that suits its social and economic conditions' This is postulated on ,open the strength of china,s present door, policy' its understanding of the necessity of importing foreign ideas and concepts in planning' its afürmation in the first NationalHousing conference held in 1979 thatprivate ownership is a correct manifestation of socialist property', and the recognition of its economic interest in Hong Kong. The future of Hong Kong will be definitely brighter if it is permitted to rery on the private sector to carry out its redeveropment projects. However' the instability of china's political direction constitutes the greatest worry of the Hong Kong people' Therefore, in order to help planners envisage the possible future of Hong Kong, the best and the worst case scenarios were constructed. under Scenario one, planners of Hong Kong can expect the present pranning system of Hong Kong to continue and be further developed. Public participation in the planning process will be on the rise' and appeals on land uses will be heard. The rule of the society will still be based on the rule of law rather than on people. since the chinese Government,s intervention in Hong Kong's domestic matters will be minimal, the planners will enjoy a considerable degree of autonomy in planning' The reports to planning china's State commission could constitute nothing more than formalities. urban redevelopment has to cater to the continual economic growth of Hong Kong. close co-operation with Guangdong will be necessary both for economic and political reasons. However, under Scenario Two, the 135

freedom of planners in exercising their expertise will be greatly constrained. Law will not be as reliable as an impartial form ofjustice. Instead, connection with Chinese Government officials will be more significant. The planning structure of Hong Kong will be rendered more complex. Planning and redevelopment projects will be delayed due to bureaucracy' Therefore, planning under scenario Two will be more like a political game. Its success will depend on the political skills of the planners and their connections with top chinese government officials, as well as the local authorities of Guangdong, though the connection between the Hong Kong and Guangdong planners may to a certain extent be restricted. In this respect, the future challenges facing Hong Kong planners will be discussed in the next chapter. In addition, some skills and techniques that could help planners to retain autonomy in the practice of their profession will be suggested. t36

Chapten Sever¡: The Chanlenges for l{ong Kong Flannens

rn 1997 and afterwards, the pranners of Hong Kong wiil have a greater challenge to face than they ever had before. Planners wil have to become more politically aware if they are to get their work done; the past role of planners as technocrats will no longer be an adequate job requirement. Even provided that Hong Kong,s present socio_ economic and political systems undergo no significant changes, the administrative system will be complicated with the take-over. Hong Kong pranners may have to report to china's state Planning commission about their plans and communication between planners of Hong Kong and china is anticipated to increase. In order to better equip themselves for the challenges ahead' planners will have to understand the situations, the nature of their tasks and judicious application of their techniques so as to gain a position of authority in this time of uncertainty. The purpose of this chapter is to address these concerns from th¡ee perspectives' The first section will discuss the urban redevelopment tasks the planners will have to meet, the second section will discuss planning and redevelopment of Hong Kong from a regional perspective and the last section will discuss the strategies that could help planners handle future uncertainties.

.4,. Hong Kong's {.Irban Redevelopment T,asks

As identified in Hong Kong's Metro pran, future urban redeveropment of the territory is restrained by:

a' existing and currently-proposed patterns of land use, the conditions of building, and the likely timing of the availability of new sites and land ownership patterns;

b. the availability and capacity of existing pranning transport networks and systems; t37

c the availability of existing and pranned utility services; i.e; water sewage, storrn water drains, gas, electricity, telephone and other telecommunication facilities;

d. various naturar factors such as geotechnicar conditions, randscape features and local climate;

e' environmentar probrems rerating to water quarity, noise, air quarity and potential hazards; and

f institutional controls, e.g. airport height limits, building density zones, ,s¡ent zones'around sensitive telecommunication installation and safety zones around quarries.

Planners have to try to arrive at ways to overcome these constraints through the resources they have and through the co-operation with other governmental departments.

In addition, planners have to pursue viable redevelopment approaches, such as those recommended in chapter four: the minimization of the effect of displacement on affected tenants, greater efficiency and conservation of organic communities, not to mention those objectives identified by the governm entt24.

na'¡"five objectives identified by the Government of Hong Kong are:

a' to upgrade existing subshndard urban areas to at least meet the currently accepted mi nimum tfu ough redevelopment or rehabi I itation; b' to plan for conveniently-located government, institution, and community shopping, residential facilities, open space. and industriJuses in an ôrOertf ;r;;., c. to provide a safe and convenient nedelrian *ou.*.nirvriem within d. to control the area; rhe use and configuration of land o, Uuild"!äi e' to upgade the transport qystem and to provide for conienient public transport. Anthony Gar-on' 'The Mobilization of urban Resources-u¡ban ,ffh Rede'elopment in Hong Kong,, t38

E. Regional Co-Operation

If Hong Kong is allowed to develop along the present path, it together with shenzhen or even Guangzhou will gradually become an economic entity. In fact, the trend began right after the PRC announced the setting up of the Shenzhen SEZ In a local chinese-language monthry "open Magazine,,, it was reported that Deng Xiaoping suggested moving the Hong Kong-shenzhen border further north. He said that the border could be moved back 5 km to include urban Shenzhen and Shekou and that the SEZ border could be expanded to include Baoan countyr25 (Fig.l6).

Graham E. Johnson has observed that:

'The barrier that is passed at Nantou is more than physical a one. The symbol of the nerv culture of the zone is an enormous filling station with the logo of one of the rvorld,s largest oil companies' It seemed to me that I was seeing an effort to deliberately isolate a portion of chinese temtory. It also seems to me that we ma)¡ be seeing the unfolding of a future scenario in which a special Administrati'e Zone will shade imperceptibly into a special Economic Zone. ultimately an entire economic and social region may emerge which will incorporate the two largest cantonese cities and a host of smailer ones' There has been a great deal of administrative reform in the pearl River Delta region over the past two years. It is norv a region that is composed armost whoily of 'municipalities'' These have been created for their economic effof. They could readily fit into an administrative structure that will mesh easily vuith the new administrative anangements in the post_l997 phase of Chinese history.,126

Easrern EconomicReview, r26Johnson,!?lf* May 14, 1992, p.21. Graham 8.,'rgg1 rnâ aft"., wìir-Iro"g Kong Survive?,, working paper the Pacific: Agenda for the Eighties, pu.in. No.43, canada and irr¿. sem¡nãr or theïniversifyçrsrty Joint Centre on olof roronto-yorkt oronto-York universifvl Modern East Ãsia, Áprii r sal, p. '. 139

The Chinese Government already has the notion of a pearl River unified region in mind This is evidenced by its initial objection to the building of the new Hong Kong airport on Lantau Island, because two new international airports had been planned for Shenzhen and Macao respectively. The chinese Government thought that the new airports would cater for the growing freight and passenger needs of Hong Kong. Therefore, it is very probable that the planning of Hong Kong will have to be extended beyond its present boundaries to include Shenzhen SEZ and part of the pearl River Estuary.

In line with the Chinese leaders'plans for a Pearl River Delta unified region is the fact that many Hong Kong-based industrialists have relocated their plants to shenzhen sEZ' The trend is expected to continue. Moreover, the completion of the super highway that rinks Hong Kong and Guangzhou together wiil surery draw Guangzhou and some other cities in Guangdong along the highway into the suburban orbit of Hong Kong lndeed' many Hong Kong people have already purchased cottages or apartment flats in shenzhen and some even have their spouses living there.

The development of the Hong Kong-Guangdong region will create a new concern for Hong Kong planners. on the one hand, the development would help Hong Kong solve the problems of overcrowding in the urban areas by permitting Hong Kong people to live in Guangdong, thanks to the increased mobility effected by the new highway Plan¡ers can then be more flexible in carrying out urban redevelopment of Hong Kong' on the other hand, Hong Kong planners should begin to establish contacts with planners in Guangdong to discuss the terms of future co-operation. 140

CUANGDC)ì.-iG '\ aq a - s ,t\", -*!^ *, oo* , .$ro $\ lut BAOAn\ C0UN'ty r\aIro !d\p t ,r_-. *

Ltlr-l¡JU

j j ()tiji-_\ ^\I;tÀ' ¡(r¿l l

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Source: Fa¡ Eastern Economic Review, l4th May, 1992, p.24 t4r

c' Fnar¡nens' sfraúegies i¡r Handtring F,utune Foriticax {Jncentair¡ties

From the scenarios constructed in chapter seven, it is evident that planners will work in an uncertain environment after rgg7. rnorder to cope with uncertainties these and the special circumstances of china, pranners wilr have roles to adapt their to suit the new conditions.

To be successfi'll' planners will not be abre to fi:nction as mere technocrats, but wilr have to act strategi caily andporiticaily. To pran strategicary, Hickling as Friend and say' planners have to abandon traditionar pranning philosophy which linearity, objectivity, aims for certainty and comprehensivenessr2T. Rather, they should learn to work with cyclicity, subjectivity, uncertainty, and selectivityrzs. To act planners politically, should acquire attributes and qualities of poriticians, such as their abirities forge compromises, to effect coaritions, make tradeoffs and agreements, and change their mindsl2e' They shourd emphasize not whai to do, but what can be done, and make the best use of the resources ava'abre so as to increase the competitive power as an internationar ofHong Kong city and thus offer possibre ways out of uncertainties.

In terms of organizational structure 4'uand tacticracllcs' strategic planning covers the aspects risted berow I. Planners have to set themselves clear goals, identi$, the opportunities, weaknesses strengths and of the time and make full use of the avairabre resources to achieve their goars. l2TAccording to Friend and Hickling. linearifi :J6i,ä:îJffJ,:'fi ,'få:i,iixiJ:iåffi:ffi r28Friend, ¡"r,","ã'üäi:åjiöfrî,',ffilïl;tri':ä,'f "' "¡v ¡r'luauon:ïvi,vmeans:' and ï,iff,1äiil::'*,,,u..,' ¡q¡ur'rË under Pressure, rcát, ,n"The r,-'"strategic choice fr;tÊT::j:rr, .o.x1ord, p.i'i' Approach,. ;;;::'i,i::,*liïä,täïþ;fi 1,,"jïîHïli,ir;i,:Tgåï:iïJen,,"SageLibrary 142

Planners should be steadfast in upholding the goars that they deem to be beneficiar to the society of Hong Kong as a whore, and shrewd enough to emproy appropriate means to achieve them' Presently' the People's Republic of china recognizes the varue of the intellectuals to the society and encourages their active participation. However, pranners should be wary and steer clear of sensitive areas that disprease the chinese Government. Rather' planners should win the trust and confidence of the chinese communist party. For instance' it is advisable for planners to stick to their expertise and pursue changes that are more in line with the ruling party's philosophy, such as demanding reforms that aim at increasing the efficiency of the government and the economy rather than hoping that radical political reforms could be achieved overnight. In this way, many of the troubres and purges that intellectuals encountered in the early and mid-1950,s, mid-r960,s and in the mid- and late_l9g0,s could be avoided. 2' Delegation of responsibilities to individuar divisions within the planning structure should occur' The divisions in question should have the autonomy to do things according to the special circumstances of the time. By de-emphasi ze centrarcontror, it may become more difficult for a single party to subvert the whole system by removing the readership and thwart intruders attempting to take over the planning administrative function. 3' Planners should plan incrementally where it is deemed appropriate. The strength of planning incrementaily, as craimed by John M. Bryson and wilriam D. Roeing, lies in its ability to handle complexity and change, its emphasis on minor as welr as major decisions, its attention to informal as well as formal process, and its political realism. In order to provide a bridge between immediate actions and the rong-term pran, pranners may need to make middle-range plans.

4' with the hand-over of Hong Kong to china, pranners of both sides have to adapr to each other's planning habits' This is especially true for the Hong Kong pranners because it is Hong Kong that is to be integrated into the N{ainrand system. In this case, adaptation of Hong Kong pranners invorves understanding, rearning, co-ordination and co_operation 143

with their new partners' Planners of Hong Kong will have to rearn the ways of doing things as practised by the PRC planners. In this regard, planners should become elrtremely well-informed about the political and administrative structure obtaining in the PRC' First of all' they have to understand the expected rores of planners in the pRC, the channels affording more power, and the departments they shourd consurt before implementing their plans' In china, physical planning is under the capital construction commission A close contact with the commission is advisable. Although it may not be obligatory for the Hong Kong pranners to foilow the pranning approach of china as postulated in scenario two, it is advisable for them to adhere to the planning guidelines of china as far as possibre, because china certainry wourd not rike to see Hong Kong develop in the opposite direction. Moreover, planners should be sensitive to the poritical climate of china. Any change in china may have a direct bearing on Hong Kong,s planning system' This is especially cogent when it is realised that china,s policy is like a pendulum swinging back and forth in cycles. consider regional development policy: china has undergone cycles of centralization, decentralization and recentralization since 1949 Planners could not anticipate a continuum of policy but must expect cyclical changes' and shourd be w'ring to adjust their goars with these poricy changes. The adjustment takes time and needs to be achieved incrementally. As Guy Benveniste puts it:

'muhul adjustment requires consistency* and does not allow us to invent too fast and too rapidly. Mutuar adjustment requires that we act incrementary; Lindbrom,s imaginery is powerfirr. In an uncefain en'ironment, group or individuars are onry abre to adjust to each other, that is, to avoid serious errors by making smalr incremental changes that allow each part), to leffn how to respond to the other., 130

Guv' 'Mastering the politics of planning'. Jossey-Bass pubtishers, il'Jr:îïït'e' san Fransico, u.s.A.. t44

correct timing is very important for the Hong Kong pranners. pranners cannot expect to put across all changes at one time and should have patience and perseverance if their proposals are not accepted and objectives not achieved immediately. In china' planning is very bureaucratic. At the municipal level, there are already capital construction commissions and RealProperty Management Bureaus, to say nothing of the unified Housing Development ofüces, responsible for hosuing. under the Real property Management Bureau, there are severar specified companies; namery; the Housing Maintenance company, the Housing construction company, the Rear property company, the Building Material and Equipment companyr3r. china has not yet estabrished a sound policy-making system and procedures, does not have an effective poricy_supporting system' evaluation system, control system and feedback syster¡n 2. Theoverlapping of jurisdictions might create conflicts and mean that it would take longer time before proposals are heard. urban pranning proposars may be supported by one government agency while opposed by the other. Therefore, planners shourd construct scenarios of the possible outcomes of their proposals and identify which actors will be politically effective and exercis€ pows¡133' Planners also have to learn how to pause, wait and look for the right time to make their suggestions and recommendations again, perhaps in another form of presentation that is more acceptable to the authorities. planners ought to respect the realities they face and understand that 'Rome was not buirt in one day,. pranning incrementally is a good way to deal with uncertainty. In addition, planners also have to realize that there are alternative options for a proposal and should not confront politicians with only one choice- within the boundary of pranning expertise, regurations, sociar

I3l Ca¡lson, Eric. 'Housingfiry.: development in China,, pp.l2-13. rvrao, qi zn,;ð-;.nì probrems i"ör,i*ù pranning,, ff.i:ñiJïf;?,'å;;a cig ciry pranning Review,

Public Expectations', schenkman pubrishing company. rnc., ^il3,rä;,il[lT;ijlijäiand cambridge, r45

consclence and responsibilities, there should also be room for options that could accommodate the interests of the politicians.

Moreover' planners should acquire information and be sensitive to issues outside their normal field of executive function. This would herp planners to better understand the circumstances of the time and respond with a holistic rather than a parochial perspective.

As 'personar power'seems to ,raws,in be greater than china, good networking is very important to the future pranning of Hong Kong. Traditionaily, rcuanxi'134 is widely practised in the chinese bureaucracy. Therefore, establishing a communication network is cruciar for pranners to comprete their work. Hong Kong planners should establish rapport with top chinese government ofücials to increase understanding lt is known that plannin g maynot always solve all conflicts, but it is important for planners to reach a consensus among different parties. A good relationship with top chinese government officials would help resolution of conflicting issues, and it would also help Hong Kong to procure resources from the chinese Government for further urban development. In addition, since the State planning commission and the capital construction commission are the organs that set planning guidelines for the whole nation' good communication with them will enhance their understanding of the situation of Hong Kong and help them to formulate planning guiderines that are more compatible with Hong Kong's needs. on the other hand, Hong Kong planners shourd keep a good working relationship and contact with planners and government officials in Guangdong. In fact' there needs to be a great deal of co-operation between planners in Hong Kong and Guangdong' Hong Kong's 'sunset'industries and people have been moving to Guangdong

134t6*n'irll%i"nanddiscussionoverspatialarrangementsareneceSsary here refers to establishing personal connection or relationship with govemment ofrcials. 146

Networking with the Guangdong planners, not only for the sake of achieving better physical planning and acquiring more essential information, but also for increasing the bargaining power of the Hong Kong planners for job more autonomy from the chinese central Government As George Hicks says, the crucial task for Hong Kong and the other commercially-minded regions of South china is to take advantage of the paralysis of leadership in the north and push for economic refbrmr35

In addition, planners have to foster respect for the chinese Government. The planning system of Hong Kong shourd be open. There shourd be no suspicion between the governments, and china should be kept informed of the latest planning developments in Hong Kong, and their counsel should be sought when needed.

However, the transferring ofjurisdictional responsibility from the British Government to the chinese Government may entail more obvious corruption in Hong Kong' one of the planners'challenges is how to maintain a good moral standard and how to use their expertise in a way beneficial to the whole society. In order to have good planning' planners not only have to earn credibility from their superiors, but also have to gain credibility from the general public. Therefore, planners should refrain from possible comtpt practices that may emerge with a change ofjurisdictional responsibility and continue to have good communications with the public This could help planners know more about the needs of the community on the one hand and to strengthen the power base of the planners on the other, by having their proposals weil supported by the society at large.

catasfrophe - book reviews" Asian- pacific ,iijit#;r"îäî:'r:i#:"able Economic Lirerature, vot.4, 147

ConcXu¡sio¡l

This chapter has listed some of the challenges that planners have to face after 7997 Planners ' of Hong Kong not only have to resorve the constraints of future redevelopment of Hong Kong, but also have to think about the role of Hong Kong in the Pearl River Estuary and how urban deveropment of Hong Kong can enhance the development of Guangdong as a whole. Furthermore, the major task that planners have to tackle other than plan-making is to obtain more power from the chinese Government so that their proposals can have a greater chance of receiving approval. It is believed that the best way for them to obtain more power is by establishing formal and informal communication channels with the central Government of china as well as the province of Guangdong Planners may have to plan incrementally and some kind of restructuring within the planning department may also be desirable. I48

ChapÉen Eight: Concl¿¡sio¡a

This thesis has discussed future urban redevelopment approaches in Hong Kong in the light of the forthcoming re-unification of the crown colony with the people,s Republic of China in 1997.

There are th¡ee sections to the thesis. The first one deals with the socio- economic conditions of Hong Kong and past urban redevelopment experience both in Hong Kong and western countries. The fotowing points for Hong Kong,s future urban redevelopment are suggested.

1' Rehabilitation and gradual renewal, which could preserve neighbourhoods and the existing life of the community, may be the best option for redevelopment of Hong Kong. 2' The Hong Kong Government should control the pace and form of redevelopment to prevent any undesirable side-effects such as the 'pencil' developments of the 1950,s. It needs also to scrutinize redeveropment proposars more carefi.rily when the height restrictions around the Kai Tak airport are relaxed 3' Actuated by the Metroplan and the Ports and Airport Development Strategy, urban redevelopment wilr occur mostry on the western side of Hong Kong. The government should make sure that redevelopment on the eastern side of Hong Kong is not neglected. Incentives for redeveropment in the ress-profitabre areas should be given. 4' Public-private partnership is envisaged to be the major force of urban redevelopment of Hong Kong' However, more co-ordination between the Hong Kong Government and the Land Development corporation is needed, especially in areas of compensation and relocation of tenants affected by the redevelopment projects.

5' In view of Hong Kong's economic restructuring, redevelopment of the old industrial areas is on the rise In order to prevent undesirable redeveropment of the industrial areas, it is advisable to expand the mandate of the Land Development corporation to these areas t49

or to establish another organization in charge of the redevelopment of the old industrial areas, whichever is deemed more appropriate.

6' with regard to the redevelopment of the old public-housing estates, the government should strive to find innovative redevelopment approaches thaÍ. arebeneficial to the tenants, such as that was practised in Shek Kip Mei.

The second section of the thesis discusses the planning system, regional development strategies, and housing policies of china. It is found that planning in china has onJy been resumed after 1978. Planning practice is bureaucratic. co-ordination among government agencies is poor, and good connection with government officials is needed to get the work done. urban redevelopment of china at present puts most stress on the rebuilding of the commercial and industrial areas. Demolition and rebuilding are the prevailing methods of redevelopment in the old residential areas owing to the fact that most of the old housing stock of china is beyond repair. with the implementation of the open- door policy, some decision-making power is decentralized to the local authorities. urban living and business practices in the coastal cities are found to resemble those of the capitalist countries However, the growing discontent of china,s interior provinces and the fear of loss of control of the centralgovernment are the major deterrents for the open- door policy to continue.

After examining the urban redeveropment practices in Hong Kong and china' it is found that the basic approach to redevelopment in the two places will diverge because of the different stages of development and economic and social conditions of china and Hong Kong' However, whether Hong Kong can pursue its own path in urban redevelopment depends on the political philosophy of the chinese leaders, Hong Kong,s economic interest to china and Ftrong Kong's relationship with the province of Guangdong' Therefore, two scenarios depicting Hong Kong,s possible best and worst ts0

futures were constructed in chapter six while in chapter seven, strategies for planners to handle future uncertainties were suggested.

Basically' the key to successful planning in the transitional period is a good Hong Kong-China relationship. Achieving good understanding and communication between the centralgovernment of china and Hong Kong's special Administrative Regional Government is an essential requirements for maintaining the stability of Hong Kong's planning system. Planners must be wary of ant agonizingthe Chinese Communist Party by the work they do, and must encourage developments that are congruent with the Chinese Communist Party's philosophy. Moreover, delegating responsibilities to individual divisions within the planning structure and forming alliances with government officials in Guangdong shourd herp pranners cope with the situation aptry.

All in an, pearr the whore region arong the River Estuary shourd grow together. Shenzhen, zuhai, Macao and Hong Kong should seek to co_operate with, and complement, each other. Planning and development should be geared towards the betterment of the whole region. The building of expensive projects which would duplicate existing development in Macao or shenzhen should be avoided. 151

Appendix

{Jnban Redeveåopff¡ent ,{dvantages Ðisadvantages Methods

1. SIum Clearance -Enhance the efficiency of -Lar ge scal e displacement Iand use. of local residents, destroys -Through the construction the tissue of the affected of high-rise residential or community. commercial buildings, it -It is economically could increase property inefficient. tax revenue and eliminate Comprehensive renewal "eye-sores" in the city usually takes a long time, centre. sometimes as long as eleven years*. -Because of the long time taken for urban renewal, there are three more adverse side-effects of slum clearance. They are: i. hesitant investment decisions in the projected afea; ii. will discourage owners from renovation and repairs, which will allow their homes in the area to deteriorate at a faster speed; iii. during execution, housing conditions continue to deteriorate which will affect the surrounding environment adversely. - It diminishes the supply of low-income housing and drives up the rental of slum housing The displaced families may

n According to Gibson, the time required for urban renewal is: land acquisitron and t)"ically requires four years, demolition each relocaiion four-and-a-half years, site improvement disposal eight-and-a-half nine years, and land years, while o'erall project time is ;.;Ë;, t52

{.lnban Redeveloprnent ,ådvantages llisadvantages Methods (com't) (com't) (con't) have to live in smaller units or "double up" with two or more households living in one housing unit

2. U rb an Rehabilitation -It emphasizes more social -Prices standard (encourages of in-situ equity and the general housing rise due to a housing improvement and well-being of the poor, decrease ofsupply maintenance) rather than land efficiency. - If no demolition occurs, -It displaces less people it will not solve problems than slum clearance. such as the lack of -Its cost is lower because community facilities and little relocation cost is trafüc jams in the area, involved. which would be alleviated -Prices of standard by more space. housing will be lowered - It is not appropriate for due to an increase of the worst slum areas supply. where changes in land-use patterns are deemed economically justifiable.

3. GradualRenewal (An -It disrupts the concerned -The process ofgradual incremental approach to community less, compared renewal is lengthy redevelopment) and with large-scale clearance. requires thorough - Due to the small scale of planning and perseverance redevelopment, the throughout the whole number of vacant housing period of redevelopment. units in the area waiting for redevelopment will be smaller. -Pump-priming schemes could be used to rehouse the affected tenants in the same district.

4. Monetary Incentives -It is a better \ryay to -Revitalizing the urban (This approach is based on preserve consumer areas without direct the assumption that the sovereignty and avoid government intervention fundamantal cause of allocative distortion. in the redevelopment neighbourhood process does not solve deterioration is that problems like traffic people have not enough congestion and over_ t53

{J¡'ban R.edevelopunemt .4dvamtages Þisadvamtages &{ethods (con't) (con't) (con't)

money to do the crowding. maintenance and repair to - Residents will spend their houses. Monetary most of their money on incentives to urban renovating their homes redevelopment may take rather than on the form of housing streetscaping subsidies, improvement and landscaping. grants or direct income transfer)

5. Urban Regeneration (a -It revitalizes the urban -It is basically a voluntary voluntary return of high- area and provides action. It is very difficult income groups from the employment. for the government suburbs) to plan for gentrification. - Similar terms are: reinvasion, reversion blockbusting, urban revitalization and gentrification.

6. Public and privare -The government can save -lt tends to be high-profile partnership f oint venture money for other uses like developments like the between the government social welfare. construction of offices and and the private developers -The public sector can feel retailing stores in urban redevelopment because assured that community private developers projects) see needs and social benefits these developments as have been taken into more profitable and more account as the appealing. government is one of the partners. - It could be more flexible and more efücient in using the private enterprise approach to redevelop the area. 154

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