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REVIEW
by this ban than Hong Kong. Overnight, the huge boom in exports to the newly-established People's Republic stopped in its tracks and, in the course of one year, the thriving entrepôt trade was destroyed. And it took Hong Kong 12 years to recover its former level of total exports.
New Directions
The territory could be certain that at that stage its salvation would not be found in supplying the needs of its neighbour. With its growing population, moreover, it needed to change the entire basis of its economy to one which would support not just a handful of merchants and hordes of commission brokers, but an ever-growing workforce. The Shanghai indus- trialists who came down here with their textile expertise, showed the way, and gradually trade began to grow. Hundreds of thousands of people at that stage, owing no allegiance to Hong Kong, made the historic decision to stay put, in spite of the appalling shanty towns in which they lived, and the hand-to-mouth existence they led. And to the credit of the government and people, none was turned away.
These were the days of soup kitchens and rice bowl welfare. A new turning point came when, on Christmas night, 1953, more than 50,000 were made homeless in an inferno at Shek Kip Mei, west of the Kowloon peninsula; the huge column of smoke from it blotted out the massif of Tai Mo Shan. Many people left Christmas dinners and volunteered to help on that night, and from this sprang three great initiatives which have helped make Hong Kong the city it is today:
First, the realisation that the refugees were here to stay and needed substantial homes;
hence, the birth of the resettlement and public housing programme;
Second, the voluntary spirit, which is perhaps Hong Kong's most priceless asset, survi-
-ving and being continually renewed and replenished down the years;
Third, the foundation of a commitment by Hong Kong to its people, a commitment that
would broaden and intensify with the passing of time.
Almost incidentally grew the understanding that Hong Kong needed something more than a market garden economy to sustain the growth that would have to take place. If welfare state Britain offered one model of progress Hong Kong had no choice but to reject it. The prohibitive cost alone would have been a fatal millstone around its neck. Moreover, constitutional advance promised by the retiring post-war Governor, Sir Mark Young, in 1946 was put aside, and under Sir Alexander Grantham, Hong Kong laid the founda- tions of an open industrial economy in which there would be no pretentious policies and no grandiose philosophies.
Taxation, which Hong Kong had accepted as a war-time necessity, was limited and controlled, and in remaining so to this day has proved one of the strongest economic incentives to old and new business. Enterprise was given the freedom to be itself and the commercial world was given almost carte blanche to get an over-populated, underemployed people to become a self-respecting workforce.
Serious riots in 1956, and trade barriers in the late 1950s against the thriving textile industry showed up Hong Kong's inadequacies, both administratively and in economic development. Without plans and without direction, a large textile industry had grown up to the point where its exported output proved indigestible to its struggling, out-dated counterpart in Britain. Hong Kong learned and adapted. Wisely, however, it was not for the government to direct and dictate the form that industry should take; leave that to market forces and let Hong Kong's natural skills come to the fore.