Sue's first draft

To what extent can the problems of urbanization be met by a policy of sustainable development?

Sub-Title: Can the sustainable development policies solve the urban housing problems in Hong Kong?

Introduction

Urbanisation has become a trend in the developing countries. Urbanisation means massive population growth in urban cities due to more and people are moving from rural to urban areas .The majorities of citizens live in a narrow area rather than stay in a large region. The government and others provide more service and resource allowance such as water, electricity and transport to a large number of citizens. Education, business and technological advances are also more accessible in urban area result in economic growth. Thus, the opportunities are the main factors to attract people to move to cities because people can seek their jobs to improve their life quality and build a better future for their children. However, the characteristics of urban area can cause a lot of serious problems in the societies like high housing price, limited resource, pollution, high population, traffic congestion, crimes. In fact, the problems of urbanisation have been the barriers to bring negative effects for the economic growth. Therefore, these problems have led the government to adopt the polices of the sustainable development to solve the problems such as waste management charge scheme, recycling scheme, renewable energy, urban living space. Sustainable development depends on how profitably balance on the objectives of society, economy and environment to maintain the needs of present for human and future generations to improve their lifestyle, protect ecosystems and the quality of environment with economic growth. In this essay, it will give the case of Hong Kong’s situation of housing problems focusing on overcrowded living condition and high housing price to evaluate the different policies of sustainable development in housing whether they are the effective solutions to meet the aim that can solve and improve the problems but maintain the economic growth simultaneously. I will also base on Hong Kong’s housing problems and sustainable policies with Shanghai to compare which city’s policies more efficient. At the end of this essay, it will give the recommendations in the future and my opinion that I think Hong Kong and Shanghai are facing urban housing problems. Although I believe there are many more problems than solution in Hong Kong but the housing polices are more efficient than Shanghai.

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Main body

In this essay, I will focus on the case of Hong Kong but I will also compare the city in ShangHai finally because it has the same housing problem with Hong Kong and adopts the similar policies. Then I will base on each situation to analyse which city’s sustainable policies will be more efficient to solve the problems. I will use the academic journals to find out the useful information to support this essay. Firstly, the beginning of main body will be given some background information about Hong Kong and I found the quantitative and qualitative data from the academic article which talk about how to detect the bubbles in Hong Kong’s residential housing market as describe by Chan, H. L., Lee, S. K. and Woo, K. Y. (2001)(1), the official website by Hong Kong’s government (2) that the statistic can prove the real situation of limited land but high population in Hong Kong. Secondly, I found the relative evidence which is demonstrated the accidental incident in Shek Kei Mei by Mark, C. K. (2007).(3) This evidence can support the problems of overcrowded and reflect that the government realised how serious of housing problem and started to adopt the housing policy to solve the problems. Thirdly, the article is described about the situation of high housing price in Hong Kong by Chan, H. L., Lee, S. K. and Woo, K. Y. (2001)(1) and I found the evidence of Hong Kong housing price ranking from the news which is Hong Kong’s newspaper website. Fourthly, the housing sustainable development information was found from two articles to obtain the main ideas by Peng, R. and Wheaton, W. C., (1994) (6) and ( Chiu, R. L. H.,2002) (7). Finally, I found a study on provision of housing system in Shanghai is reported by Mostafa, A., Wong, F. K. W., and Hui, E. C. M.,(1998) (8) to support the comparison of polices between Hong Kong and Shanghai.


Hong Kong is one of the most densely populated cities in the world. The population in Hong Kong has increased rapidly and it was indicated about 7 million at the end of 2009 by the latest statistic which is found from the official statistic on "Population and Vital Events (2).It is obvious that shortage of housing units is a historical problem due to Hong Kong’s population growth and economic progress. What is the factor leading to population growth? Immigration is one of the main reasons because people desire to move from rural area to urban area to improve their life quality and looking for further different opportunities such as career, education. In particular, in times of war, violence or ecological disaster results in an influx of refugees who move from the damaged area to more steady and flourishing areas. This phenomenon is especially true in Hong Kong. Since the Second World War in 1956, the large number of refugees immigrated to Hong Kong leading to lack of provision of residential areas. This is because Hong Kong’s location next to China and comparatively prosperity. Thus, the mainlanders believed that Hong Kong can provide more stable life and prosperous economy for their future, but this circumstance led to overcrowded on households and deteriorated of housing environment.


Moreover, housing problems not only means the quantity of housing, but it also relate the housing quality and maintenance such as a large number of people and new migrants live in the squatters where have inadequate facilities and poor sanitation due to lack of planning with lower standard of early development .These are the potential risks can lead to dangerous accident such as fire. Mark, C. K. (2007) (3) indicates the evidence of Shek Kei Mei fire in 1593 when Hong Kong was British colony. The mainlander built the squatter huts for their accommodation after they settled down in Hong Kong. Due to narrow area in the squatter village caused a serious fire that led to most of the people homeless. Mark C. K. (2007) (3) also mentions that it was impossible to allocate the funds for the exclusive refugees because it was a short term resolution with huge cost. Therefore, this incident was a very important factor to inspire the government to build the resettlement estates for them leading to a great impact for the government to develop the sustainable housing policy in the following decades.


In addition, Hong Kong has maintained a high housing price because of limited of supply land. H.L. Chan, S. K. Lee and K. Y. Woo,(2001)(1) indicate that the total area of land in Hong Kong is only about 1075 km2 but there is approximate 80 % of the region where is too hilly in housing development. Thus, only a little segment can be used for residential development. This is no doubt that land is the scarcest resource in Hong Kong. In fact, Hong Kong‘s housing price ranking which is the fourth out of the ten cities in the world with about US$1373 each per square foot (4).For instance, a narrow flat which is about 583 sq ft with a single bedroom that it sales about 483,333 pounds of Kennedy Town Building where is in Hong Kong Island (5). Therefore, most of citizens can not afford to buy their own flat. It is common to find the Hong Kong Citizens who are living in a poor living condition such as a big family with 6 members but live in a small flat. They do not have own bedroom but need to share the area together leading to overcrowded households. Besides, the limited supply land restrictions in Hong Kong housing market. The development of the conclusive land supply and the new land available is controlled by its government directly. The government aware high housing price is an urban problem for the citizens leading to implement different sustainable polices to solve this problem.





Since the Shek Kei Mei fire, Hong Kong’s government started to pay more attention to implement various sustainable developments to solve the housing problems such as the provision of public rental housing (PRH). However, this stage of PRH policy was not comprehensive housing policy. Peng, R. and Wheaton, W. C., (1994) (6) indicate that the government has played a very important role to provide low –cost public housing. ‘At the end of 1980s, Hong Kong had the second largest public housing sector in the capitalist world. ’(Peng, R. and Wheaton, W. C., 1994,p.268) (6). It means the government has adopted large investment to develop the public housing as the article reports that about half of the total housing stocks are used for developing PRH policy. A decline of housing size was one of the significant changes over the past three decades in Hong Kong. The article reports that the number of people per occupied housing unit was 8.4.in 1965 but this number decreased to 4.3. in 1990. These statistics proved the public housing policy was efficient to improve the housing problems.

However, Chiu, R. L. H.,(2002) (7) indicates that the housing policy has experienced dramatic changes again since 1997. This is because the new government of Hong Kong Special Administrative (HKSAR) is more focus on the social issue to adopt a resolution in housing policy. As this article mentions that the main housing policies are established by new government such as a rate of 70% home ownership was targeted for 2006 to reinforce social stability and the sense of belonging; 8500 units of target production was set to decrease the housing price each year and to eliminate the housing needs; a pledge was made shorter period as three years for the waiting time of public rental housing. The purpose of these policies base on the Home Owner Scheme (HOS) and Public Rental Housing (PRH) to make the adjustment. The aim of these polices encourage more people to buy their own flat at the cheaper price and arrange the poor people to live in the Public Rental Housing in a shorter time. Furthermore, housing policies are comprehensive in Hong Kong because the government has considered different aspects to suit various kinds of people such as the Rent Allowance for Elderly Scheme in the PRH housing policy because of the needs of elderly people of housing ( Chiu, R. L. H.,2002) (7)


On the other hand, the urban housing problem in Shanghai also has been one of the most serious social problems as Hong Kong. The survey reported that about half of the city’s 1.8 million households lived in overcrowded area in 1985.Nearly 216,000 households had per living area below 4 square meters only, more than about 15,200 of those households had less than 2 square meters. Shanghai Municipality had begun to adopt the Housing Settlement project in 1987 to solve the urban housing problem. The policy has resettled over 470,000 households living in the narrow space under 2.5 square meters. The Municipality spent 1.8 million Yuan on the project, developing about 1,8 square meters for households’ overcrowded problem (8). Therefore, the new residential areas were developed Shi Guang, Guo He, Kang Jian. This project is a sustainable development and it has been the process of Shanghai’s housing system reform. In fact, Shanghai has similar housing policies as Hong Kong but it is obvious that Hong Kong’s housing sustainable development policies are more efficient and comprehensive than Shanghai. This is because Hong Kong‘s market performance is more flexible and it has exercised its provision of residential areas for long period under a laissez-faire economy. Additionally, a large part of civilian in shanghai belongs to working- class which means they can not afford even under the home ownership policy. Thus, the home ownership scheme may cause a burden on the local government in the future.(5) ( Mostafa, A., Wong, F. K. W., and Hui, E. C. M.,1998)(8)


Conclusion
In fact, Hong Kong and Shanghai are suffering the same situation of urban housing problems. Both of cities have implemented the similar sustainable polices in the housing development but it is apparent that Hong Kong’ has favorable factors such as flexible market, a laissez-faire economy leading to more comprehensive polices than Shanghai. Although both city’s housing polices are planned to solve the problems such as lack of residential area and high housing price, I believe that it is hard to solve these kind of problems in long term. Due to the population growth in Hong Kong and Shanghai has increased even in the future. It is difficult to control the population growth but distribute the area under the limited land supply. For instance, the PRH policy in Hong Kong, its government provide lower rent for lower or no income people to offer stable residence. Even adopting the adjusted police as changing the shorter waiting time as three years for public rental housing but the waiting time still are too long. Therefore, it can not really assist the people who desire the real help. Moreover, the scheme of Public Rental Housing (PRH) and Home Owner (HOS) can facilitate economic growth because the government can increase its income by the policies. It is obvious that urbanization can cause economy progress but many urban problems at the same time. Thus, the government has adopted the sustainable development that is definitely important and continues to keep our society stability in the future.




References:

(1) Chan, H. L., Lee, S. K. and Woo, K. Y. (2001), Detecting rational bubbles in the residential housing markets of Hong Kong, the journal of Economic Modelling 18, pp.61-73

(2) Hong Kong Statistic, Census and Statistics Department, available at: http://www.censtatd.gov.hk/hong_kong_statistics/statistics_by_subject/index.jsp
(accessed 18 July 2010)

(3) Mark, C. K. (2007), The problem of people : British colonials, Cold War Power, and the Chinese Refugees in Hong Kong, 1949-62 ,the journal of Modern Asian Studies 42,6,pp. 1145-1181


(4) Business Times Newspaper from Hong Kong, available from,
http://gb.hkbt.com.hk/a-20091007/hk_4.htm (accessed 19 July 2010)


(5)Knight Frank, Kennedy Town Building, Kenned own Praya, available from, http://search.knightfrank.com/hk00052987s (accessed 20 July 2010

(6) Peng, R. and Wheaton, W. C., (1994), Effects of Restrictive Land Supply on Housing in Hong Kong : An Econometric Analysis, the journal of housing research, vol.5,issue 2,pp.263-293
Report

(7) (Chiu, R. L. H.,(2002), Social Equity in housing in the Hong Kong Special Administrative Region : A Social Sustainability Perspective, the journal of Sustainable Development ,10, pp.155-162

(8) Mostafa, A., Wong, F. K. W., and Hui, E. C. M.,(1998) , A study on Housing provision System towards Hosuing Affordability in Shanghai, available from:
http://www.iut.nu/China_Shanghai_hous%20affordabiity.pdf (accessed 22 July 2010)