Economy

Why Hong Kong Is Still A Model For Mainland China

A national flag-raising ceremony is held in Hong Kong, on May 4, 2015.
A national flag-raising ceremony is held in Hong Kong, on May 4, 2015.
Wang Duan

-OpEd-

HONG KONG â€" Lately there have been snarky voices and Internet taunting directed at Hong Kong. This mostly comes from Chinese mainlanders declaring that Hong Kong's economy is doddering and unprogressive, and that from both an entrepreneurial and infrastructure point of view, it is lagging behind the world and mainland China.

Other critics say that Hong Kong is also no longer much of a reference for those seeking reform and more openness on the Chinese mainland. Some have even used the term "parasitic economy" to describe Hong Kong.

Though there is some real evidence behind these arguments, I’m still convinced that it would be a serious mistake to underestimate the Hong Kong economy. It's true that economic data would suggest the former British colony's economic output in a decade will be comparable only to some of the mainland's second-tier cities. But any smart analysis should include questions beyond mere scale.

In recent years, Hong Kong's economy has mainly depended on a highly developed modern service industry. Its experiences, as well as the lessons it has learned, are a valuable reference for the rest of China, which is undergoing an economic transformation.

Hong Kong's economy once outshone that of the whole of China. In the early 1990s, this tiny city that makes up only 1/10,000 of China's total surface area had a GDP equivalent to 25% of the mainland's. This has now fallen to 3%. Shanghai and Beijing's GDP surpassed that of Hong Kong in 2009 and 2011, respectively, and it's likely that in three to four years the city’s GDP will be overtaken by China's major coastal cities, such as Guangzhou, Tianjin and Shenzhen.

So compared with 10 or 20 years ago, Hong Kong's position has dramatically changed amid global economic restructuring and the Chinese economy's newfound prominence in the world. But the economy is just one facet of Hong Kong. It would be shortsighted to assert that the post-colonial city can no longer serve as an example for Chinese reform.

Hong Kong's economic development has undergone several transformations, from manufacturing to entrepreneurial trade to a service industry led mainly by the financial sector. It's precisely this arduous journey that can be instructive for the mainland, which is experiencing a major economic transformation. Despite the impossibility of comparing Hong Kong's economic volume with China's, it's resourcefulness and adaptability are still beyond the reach of most cities.

Rule of law

In China's latest Plenary Session, some of the smartest reforms are aimed at improving its administrative approval system, restraining the government's power, and building a society ruled by law. The core of these reforms is to enable the market to play a "decisive" role in the allocation of resources.

A free market and the rule of law are precisely what Hong Kong has always painstakingly strived for as a way to guarantee its competitiveness. Such public "software" is precisely what a lot of Chinese mainland cities are lacking. Without such basic competence, their investment environments will remain unattractive.

Not only does China's manufacturing need an upgrade, so too does its service sector, which means more confidence in the rule of law and a service-oriented government. Hong Kong's legal system is a result of a long history and constant improvement. When Chinese companies face litigation with multinationals, they often prefer to go to Hong Kong for arbitration or adjudication. This kind of trust is what we call an "intangible asset."

Central to encouraging competitiveness is Hong Kong's highly competent and professional work force. Not only does Hong Kong welcome talent from all over the world, it also possesses a top education system, with several prestigious universities, such as the University of Hong Kong, The Chinese University of Hong Kong and the Hong Kong University of Science and Technology.

Hong Kong also remains the first stop for expanding internationally for many Chinese companies. Not only have hundreds of mainland enterprises been listed on the stock market and successfully obtained funding, even more important are Hong Kong's stringent listing procedures and information disclosure and accounting standards. This has even drawn some of China's top state-owned enterprises.

Tale of more than two cities

Many believe that Shanghai will eventually replace Hong Kong. But it is a mistake to consider this a zero-sum game, or "Tale of Two Cities." The sheer size of China's economy can offer plenty of space for several financial centers, which all would have something to learn from Hong Kong. Take Shanghai's ongoing efforts to build a free-trade zone, an area in which Hong Kong has long been a world leader.

Undoubtedly, Hong Kong faces severe challenges ahead, and must find ways to move beyond being just a financial center and get better leadership from its public officials. In the long run, its biggest opportunity is the expansion and transformation of the entire Chinese economy. As China transits from a capital-inbound country to a capital-outbound one, Hong Kong shouldn't miss the chance to consolidate and accelerate its role as Asia's top financial center.

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Society

The Food Truck, A Sign That The White And Wealthy Are Moving In

In San Diego, California, a researcher tracked how in the city's low-income neighborhoods that have traditionally lacked dining options, when interesting eateries arrive the gentrification of white, affluent and college-educated people has begun.

Balboa Park Spring Fling Food Truck festival

San Diego Food Trucks via Facebook
Pascale Joassart-Marcelli

SAN DIEGO — Everybody, it seems, welcomes the arrival of new restaurants, cafés, food trucks and farmers markets.

What could be the downside of fresh veggies, homemade empanadas and a pop-up restaurant specializing in banh mis?

But when they appear in unexpected places – think inner-city areas populated by immigrants – they're often the first salvo in a broader effort to rebrand and remake the community. As a result, these neighborhoods can quickly become unaffordable and unrecognizable to longtime residents.

An appetite for gentrification

I live in San Diego, where I teach courses on urban and food geographies and conduct research on the relationship between food and ethnicity in urban contexts.

In recent years, I started to notice a pattern playing out in the city's low-income neighborhoods that have traditionally lacked food options. More ethnic restaurants, street vendors, community gardens and farmers markets were cropping up. These, in turn, spurred growing numbers of white, affluent and college-educated people to venture into areas they had long avoided.

This observation inspired me to write a book, titled The $16 Taco, about how food – including what's seen as "ethnic," "authentic" or "alternative" – often serves as a spearhead for gentrification.

Take City Heights, a large multi-ethnic San Diego neighborhood where successive waves of refugees from places as far away as Vietnam and Somalia have resettled. In 2016, a dusty vacant lot on the busiest boulevard was converted into an outdoor international marketplace called Fair@44. There, food vendors gather in semi-permanent stalls to sell pupusas, lechon (roasted pig), single-sourced cold-brewed coffee, cupcakes and tamarind raspado (crushed ice) to neighborhood residents, along with tourists and visitors from other parts of the city.

Informal street vendors are casualties.

A public-private partnership called the City Heights Community Development Corporation, together with several nonprofits, launched the initiative to increase "access to healthy and culturally appropriate food" and serve as "a business incubator for local micro-entrepreneurs," including immigrants and refugees who live in the neighborhood.

On paper, this all sounds great.

But just a few blocks outside the gates, informal street vendors – who have long sold goods such as fruit, tamales and ice cream to residents who can't easily access supermarkets – now face heightened harassment. They've become causalities in a citywide crackdown on sidewalk vending spurred by complaints from business owners and residents in more affluent areas.

This isn't just happening in San Diego. The same tensions have been playing out in rapidly gentrifying areas like Los Angeles' Boyle Heights neighborhood, Chicago's Pilsen neighborhood, New York's Queens borough and East Austin, Texas.

In all of these places, because "ethnic," "authentic" and "exotic" foods are seen as cultural assets, they've become magnets for development.

Food vendor at outdoor international marketplace called Fair@44.

Fairat44 via Instagram

A call for food justice

Cities and neighborhoods have long sought to attract educated and affluent residents – people whom sociologist Richard Florida dubbed "the creative class." The thinking goes that these newcomers will spend their dollars and presumably contribute to economic growth and job creation.

Food, it seems, has become the perfect lure.

It's uncontroversial and has broad appeal. It taps into the American Dream and appeals to the multicultural values of many educated, wealthy foodies. Small food businesses, with their relatively low cost of entry, have been a cornerstone of ethnic entrepreneurship in American cities. And initiatives like farmers markets and street fairs don't require much in the way of public investment; instead, they rely on entrepreneurs and community-based organizations to do the heavy lifting.

In City Heights, the Community Development Corporation hosted its first annual City Heights Street Food Festival in 2019 to "get people together around table and food stalls to celebrate another year of community building." Other recent events have included African Restaurant Week, Dia de Los Muertos, New Year Lunar Festival, Soul Food Fest and Brazilian Carnival, all of which rely on food and drink to attract visitors and support local businesses.

Meanwhile, initiatives such as the New Roots Community Farm and the City Heights Farmers' Market have been launched by nonprofits with philanthropic support in the name of "food justice," with the goal of reducing racial disparities in access to healthy food and empowering residents – projects that are particularly appealing to highly educated people who value diversity and democracy.

Upending an existing foodscape

In media coverage of changing foodscapes in low-income neighborhoods like City Heights, you'll rarely find any complaints.

San Diego Magazine's neighborhood guide for City Heights, for example, emphasizes its "claim to authentic international eats, along with live music venues, craft beer, coffee, and outdoor fun." It recommends several ethnic restaurants and warns readers not to be fooled by appearances.

Longtime residents find themselves forced to compete against the "urban food machine"

But that doesn't mean objections don't exist.

Many longtime residents and small-business owners – mostly people of color and immigrants – have, for decades, lived, worked and struggled to feed their families in these neighborhoods. To do so, they've run convenience stores, opened ethnic restaurants, sold food in parks and alleys and created spaces to grow their own food.

All represent strategies to meet community needs in a place mostly ignored by mainstream retailers.

So what happens when new competitors come to town?

Food vendor at outdoor international marketplace called Fair@44.

Fairat44 via Instagram

Starting at a disadvantage

As I document in my book, these ethnic food businesses, because of a lack of financial and technical support, often struggle to compete with new enterprises that feature fresh façades, celebrity chefs, flashy marketing, bogus claims of authenticity and disproportionate media attention. Furthermore, following the arrival of more-affluent residents, existing ones find it increasingly difficult to stay.

My analysis of real estate ads for properties listed in City Heights and other gentrifying San Diego neighborhoods found that access to restaurants, cafés, farmers markets and outdoor dining is a common selling point. The listings I studied from 2019 often enticed potential buyers with lines like "shop at the local farmers' market," "join food truck festivals" and "participate in community food drives!"

San Diego Magazine's home buyer guide for the same year identified City Heights as an "up-and-coming neighborhood," attributing its appeal to its diverse population and eclectic "culinary landscape," including several restaurants and Fair@44.

When I see that City Heights' home prices rose 58% over the past three years, I'm not surprised.

Going up against the urban food machine

Longtime residents find themselves forced to compete against what I call the "urban food machine," a play on sociologist Harvey Molotch's "urban growth machine" – a term he coined more than 50 years ago to explain how cities were being shaped by a loose coalition of powerful elites who sought to profit off urban growth.

I argue that investors and developers use food as a tool for achieving the same ends.

When their work is done, what's left is a rather insipid and tasteless neighborhood, where foodscapes become more of a marketable mishmash of cultures than an ethnic enclave that's evolved organically to meet the needs of residents. The distinctions of time and place start to blur: An "ethnic food district" in San Diego looks no different than one in Chicago or Austin.

Meanwhile, the routines and rhythms of everyday life have changed so much that longtime residents no longer feel like they belong. Their stories and culture reduced to a selling point, they're forced to either recede to the shadows or leave altogether.

It's hard to see how that's a form of inclusion or empowerment.The Conversation

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Pascale Joassart-Marcelli is a Professor of Geography and Director, Urban Studies and Food Studies Programs at San Diego State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.


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