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HONG KONG
BUILDING FOR THE FUTURE
rugged hillside or uplands, unsuitable for development, or which need to be retained as water catchment areas. Some of it consists of outlying islands, equally hilly or difficult of access. Most urban development has therefore had to take place on flatter land near the sea, or on tidal inlets, with more space being obtained by filling in the adjoining seabed. The land thus formed had then to be serviced with internal roads, drainage and sewage disposal, water supplies and other necessary amenities. And at that stage, apart from housing, provision had to be made for all the requirements and amenities of a town in accordance with planning standards to include, for instance, industry, offices, shops and other commercial development, as well as social requirements such as schools, hospitals and clinics, police and fire stations, public buildings, parks and other open space, sporting and leisure facilities and a town centre. On top of the very considerable public spending in- volved in all this, it has also required large expenditure by the private sector on residential and commercial facilities and industrial buildings.
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Over the past 15 years the New Towns programme has provided land for some 200 000 public housing apartments and more than 130 000 private sector units. The result has been that by 1987 the population of all the new towns has risen to two million, more than a third of the total estimated population of 5.6 million in the whole of Hong Kong. The population of the New Territories as a whole, also, has trebled since 1972, when the New Towns programme started.
The Seventies – Into Accelerated Growth
The early seventies saw a recovery from the relative slow down in both public and private development expenditure that occurred in the late sixties. Apart from the completion of the Cross-Harbour Tunnel, it also saw the construction of the first of the really tall buildings, the Connaught Centre. It was, too, the period when more ambitious planning for the future began to take shape, for instance the public housing and new towns programmes and plans for building the MTR. The years 1972 and 1973 also witnessed the first substantial stock exchange boom and its subsequent collapse.
The recovery suffered a sharp setback in 1974 and 1975, when the first oil price explosion was followed by a severe worldwide recession and, in the early stages, substantial price inflation. For a short period, in late 1974 and early 1975, exports fell so sharply, in response to the recession in Hong Kong's major markets, that unemployment rose to over 10 per cent of the labour force. There was, however, a substantial rise in exports in 1976, followed by a jump in capital expenditure in 1977. Hong Kong had bounced out of the recession and did not look back until another recession, following the second oil price shock, caught up with it in 1982–3, at a time of political uncertainty over its own future.
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The five years from 1977 to 1981 saw higher growth in the gross domestic product (GDP) - at an average of over 10 per cent per annum in real terms, and a bigger sustained expansion in investment, than any other five-year period in the history of Hong Kong. Indeed, by the beginning of the eighties, gross domestic fixed capital formation was equivalent to more than a third of GDP. Given the fact that the GDP was itself substantially higher than previously, this meant that the total volume of investment was very much greater than in earlier years.
These were not only the years of growing investment in railway construction, in new town development, and in road building. They were also boom years in private construc- tion of all kinds for residential, commercial and industrial purposes. Easy availability of credit fuelled a speculative bubble of demand that drove up land prices to unprecedented heights, even though at least twice as much land was being put on the market than ever