16-10-2024 (HONG KONG) In a bold move to address longstanding issues plaguing Hong Kong, Chief Executive John Lee has announced a comprehensive set of policies aimed at alleviating the city’s acute housing shortage and reinvigorating its flagging economy. The measures, unveiled during Lee’s third policy address since taking office in 2022, signal a significant shift in the government’s approach to urban development and economic growth.
At the forefront of Lee’s agenda is a ground-breaking initiative to ban flats smaller than 8 square metres – an area roughly twice the size of a king-size bed. This move comes in response to the widespread problem of ‘nano flats’ and subdivided units that have become synonymous with Hong Kong’s housing crisis. The government plans to implement this ban gradually, allowing registered landlords time to bring their properties up to the new standards, which include requirements for windows and independent toilets.
The housing reforms are a direct response to Chinese President Xi Jinping’s directive to resolve Hong Kong’s persistent accommodation woes. With approximately 110,000 households out of a population of 7.5 million living in subdivided flats, and a 2021 government study revealing that 21% of these households occupy less than 7 square metres of living space, the need for intervention has become increasingly urgent.
In a bid to stimulate the economy and attract high-end tourism, Lee announced a significant reduction in taxes on premium spirits. The tax cut will apply to liquors with over 30% alcohol content and an import price exceeding HK$200 (US$25.75), a move expected to boost the city’s hospitality and tourism sectors.
Further economic initiatives include the expansion of the investor immigration scheme to encompass luxury property buyers and the establishment of a HK$10 billion fund dedicated to investing in cutting-edge industries such as artificial intelligence and semiconductors. These measures are designed to attract both capital and talent to the city.
Addressing Hong Kong’s looming labour shortage, estimated at 180,000 workers over the next five years, Lee outlined plans to increase university admissions and streamline the process for bringing in skilled workers from abroad.
These reforms come at a critical juncture for Hong Kong, as the city struggles to recover from the economic impact of the 2019 protests and the subsequent years of isolation due to stringent pandemic measures. The government is also keen to rehabilitate Hong Kong’s international reputation, which has been tarnished by the implementation of controversial national security laws.
While the policy address was met with cautious optimism by many, it was not without its critics. Shortly before Lee’s speech, members of the League of Social Democrats, Hong Kong’s last remaining opposition party, staged a small protest outside government headquarters, closely monitored by police.
