[SCMP Column] It's Time to Bridge the Gap

November 28, 2015

“The Hong Kong-Zhuhai-Macau Bridge – White elephant or cash cow” said the breathless flyer for the SCMP conference last week. Of course it is neither. Instead, it is a stunning monument to our government’s capacity for procrastination.

Gordon Wu of Hopewell Holdings first proposed the bridge to the western side of the Pearl River Delta (PRD) in 1988. The estimated price tag was $6 billion. Today, the price tag is $120 billion and counting – just for the Hong Kong segments of the bridge. And oh, by the way, we will be lucky to have it open by 2020.

Way back in 1988, I thought the bridge was a brilliant idea. And on balance I still do – even though I always argued that it should include a rail line as well as a road. It would bring to an end to Hong Kong’s problem of sitting at the end of a “cul-de-sac”. Instead, Hong Kong would sit neatly at the southern end of a loop that integrated the entire Pearl River Delta. It would affirm Hong Kong’s dominant position at the heart of one of the world’s most dynamic manufacturing regions. It would also lift the neglected western municipalities of Zhongshan and Jiangmen.

Now, three decades later, the bridge remains an important part of the delta region’s future infrastructure, but it is less radically transformative for the PRD. Other bridges have been built further up the Pearl River. Back then, Hong Kong accounted for 18% of China’s GDP, and would have built on that predominance. Today, Hong Kong is barely 2% of China’s GDP. Shenzhen is more populous and will soon overtake Hong Kong in terms of GDP.

When I first tramped through the rice paddies and sugar cane fields of Shenzhen and Dongguan in 1978, those two economies were half the size of the PRD’s two main western municipalities. But as Deng Xiaoping swung open the doors to investment from Hong Kong in the early 1980s, billions of dollars swept into Shenzhen and Dongguan, these two municipalities were Hong Kong’s natural manufacturing hinterland along the creaking railway line across the Lowu Bridge from Hong Kong to Guangzhou. Before we knew it, there were more than 10,000 Hong Kong-invested factories, and over 11 million workers. By today, the economies of Shenzhen and Dongguan have a combined GDP of around RMB2,200 billion and are more than 2,000 times larger than in 1978. They have also massively outstripped Zhongshan and Jiangmen, which have a combined GDP of RMB490 billion – barely one sixth the size of Shenzhen and Dongguan.
Hong Kong was without any doubt the key catalyst for the explosive growth of Shenzhen and Dongguan, within easy three hours driving time from the boundary, and providing ready access to Asia’s largest container port.

But without a Zhuhai bridge, Hong Kong has never been able to perform the same catalytic role for Zhongshan and Jiangmen. The drive from Hong Kong was too long for a factory boss to go and return in a single day. And the task of getting freight from the west Pearl River Delta either by small river vessels, or along traffic gnarled roads was troublesome and uncompetitive.

The bridge to Macau and Zhuhai can be transformative even today for the western PRD – if we can ever get our act together and built it. Cargos could be moved swiftly to the Hong Kong port, and the travel time from Hong Kong would be more than halved.

So why the procrastination? Undoubtedly the task of agreeing construction plans between at least three governments (Hong Kong, Macau and Zhuhai), and sometimes Guangzhou and Beijing too, was always going to be challenging. But the reality is that still today many in our administration have only a half-hearted interest in stronger integration with the Pearl River Delta, even though it is our natural market today and the richest and most dynamic part of a Guangdong economy that is about the size of Spain.

This half heartedness has been fanned by a sometimes ferocious and counter-productive antipathy among our political leaders towards linkages of any kind with the Mainland in general, or the PRD in particular. And this in turn has fuelled the deep and distasteful antipathy among many Hong Kong people towards their no-longer-impecunious country-cousins to the north. There are days when I fear this xenophobic reluctance to recognize the huge and mutually-beneficial role we can play in the development of one of the world’s most exciting economic regions will be the ruin of us.

So let’s be clear. Hong Kong thrived for almost six decades in spite of an often-chaotic and impoverished China. It seems extraordinary and inconceivable to me that we may do worse as China has begun the long and painful journey of re-engaging the world economy. And yet that is exactly what many in our community seem determined to do. Thank goodness, Hong Kong’s role as an intermediary between China and the global economy remains strong. But how much stronger and more dynamic we would be if we were at the heart of shaping the growth of our own natural market – the 60-million strong Pearl River Delta region. It is like London pressing to lead the world as a financial centre, but willfully cutting itself off from the UK economy.

So the bridge to Zhuhai is neither white elephant nor cash cow. Rather, it is an indispensable piece of infrastructure that greatly improves our integration with the economy that we should call our home economy. The sooner it is in place the better.
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