Initial system Entire system
(HK$100 million) (HK$100 million)
Civil construction (including land costs) 14.75 31.329
Mechanical and electrical equipment 4.86 12.579
Total 19.61 43.908
Source: Hong Kong Government, Mass Transit Further Studies Final Report: Abstract, Hong Kong, Government Printer, 1971, p.3.
majority of the works carried out in Stage 3. The Sha Tin Line would run from
Tsim Sha Tsui to Sha Tin, with the majority of the works carried out in Stages
5 and 6. The system was to have 50 stations, eight of which were interchange
stations. There would also be transport ancillary facilities connecting the MTR
stations. Counting from 1967, it was estimated that the entire system would be
open in 1985, requiring a total of 17 years. The budgeted costs were 3.4 billion
Hong Kong dollars, equivalent to 200 million Hong Kong dollars per year on
average. The allocation of the investment was 6 per cent on land cost, 58 per cent
on station construction and 36 per cent on ancillary facilities.
The foremost focus of the whole MTR concept was to divert urban transport
in districts such as the northern shore of Hong Kong Island, Kowloon South
and Kowloon East, followed by strengthening connections of New Territories
districts Tsuen Wan and Sha Tin with the urban areas, so as to match the pop-
ulation distribution in various districts as projected in the Hong Kong Mass
Transport Study. Development of the various stages had to start with the city’s
urgent needs. The pace of development would be dictated by the foremost task
of solving transport problems in the city’s core districts, followed by an expan-
sion to the new towns. The government held a public tender in July 1972 for the
construction of the MTR,191 thereby officially launching the railway project.
The Mass Transit Further Studies Final Report released in 1970 revised the
1968 proposal: adjusting construction costs to 4.491 billion Hong Kong dollars
and postponing the year of completion by one year to 1986,192 with the number
of stations reduced to 48 and the length of the railway increased to 52.6 kilome-
tres.193 (See Table 4.17.)
At a meeting of the Legislative Council in June 1972, Financial Secretary
Philip Haddon-Cave stated:
we believe, first, that a substantial sum of public money can be committed to assist
in financing the project; secondly, that the railway can be constructed without
191
Hong Kong Mass Transit Railway Provision Authority, Hong Kong Mass Transit Railway: Preliminary
Information for Prospective Tenders, Hong Kong, Freeman Fox and Partners (Far East), 1975, pp.1–14.
192
Hong Kong Government, Mass Transit Further Studies Final Report: Abstract, Hong Kong, Government
Printer, 1971, p.1.
193
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, p.32.
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214 · MAKING HONG KONG
undue disruption; and thirdly, that the system can be operated in such a way as
to generate a sufficient cash flow to service the investment and cover operating
costs.194
To tackle problems such as financing, construction and operation costs,
Haddon-Cave established a steering group of which he was the chairman. He
also mentioned that the Hongkong and Shanghai Bank would vigorously assist
the steering group to undertake research on financing options other than gov-
ernmental funding and that the government would do its utmost to get the con-
struction started in early 1974.195
In August 1973, four large international consortia started bidding for the MTR
Initial System’s construction works. The Mitsubishi Japanese Consortium was
the successful tenderer, and its Hong Kong representative, Jardine, Matheson
and Co., signed the letter of intent on 16 February 1974. Prices of basic materials
soared in 1974 shortly after the outbreak of the oil crisis in 1973. The Japanese
Consortium was unable to continue operation as a consequence of inflation; it
announced its withdrawal in 1975, and the MTR plan was interrupted.196
The government modified the design of the Initial System and reduced its scale
to 15.6 kilometres and just 15 stations connecting major residential areas and
industrial areas between Central and Kowloon.197 Governor MacLehose, along
with Financial Secretary Philip Haddon-Cave and Baron Sandberg (Chairman
of the Hongkong and Shanghai Banking Corporation), announced the govern-
ment’s new financing concept – establishing a company that would operate
on prudent commercial principles under the management of the government.
Consortia around the world (55 per cent overseas institutions and 45 per cent
local ones) would be invited to join the company, with the government respon-
sible for a small percentage of funding. Eventually four civil engineering consor-
tia agreed to the government’s design and the budget for construction costs and
participated in the project.198
The Modified Initial System cost a total of 5.8 billion Hong Kong dollars,
of which 5 billion Hong Kong dollars was the contract costs for building and
equipping the MTR system (around 4 billion Hong Kong dollars for civil engi-
neering works and 1 billion Hong Kong dollars for electrical and mechanical
works). Total contract costs of 5 billion Hong Kong dollars and 1 billion Hong
Kong dollars of interest and finance costs incurred on the construction of the
MTR system were funded by export credits as well as local and overseas loans,
194
Hong Kong Legislative Council, Reports of the Meetings of the Legislative Council of Hongkong, 7 June
1972, p.797, http://www.legco.gov.hk/yr71-72/h720607.pdf.
195
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, pp.34–35.
196
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, p.35.
197
Dixiatielu shouri tongche jinian tekan (Official Souvenir Book to Commemorate the First Day of Running
MTRC Trains), Hong Kong, Mass Transit Railway Corporation, 1979.
198
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, p.42.
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High-density development planning (1945–1979) · 215
Table 4.18 Total expenditures on construction of the Mass Transit Railway
Kwun Tong Line Tsuen Wan Line Island Line
(HK$100 million) (HK$100 million) (HK$100 million)
Construction costs 56 39 104
Interest and Financing costs 17 14 15
Total 73 53 119
Source: Mass Transit Railway Corporation, Mass Transit Railway Fact Sheet, Hong Kong, Mass Transit Railway Corporation,
1989, pp.2–4.
the majority of which were guaranteed by the Hong Kong government. The
government was responsible for the 800 million Hong Kong dollars spent on
administration, land and consultancy fees and was compensated by shares of
equivalent value in the Mass Transit Railway Corporation. (See Table 4.18 for
total construction expenditures.)
The numerous difficulties that MTR construction works encountered were
comparable to the current opposition faced by the construction of the Hong
Kong section of the Guangzhou–Shenzhen–Hong Kong Express Rail Link.
Intense debate was triggered following the publication of the Hong Kong
Mass Transport Study in 1967. The headline of the South China Morning Post
was ‘Transport Men See Disaster in Railway Proposal’.199 Road traffic was
blocked, congested or even halted during construction. When works com-
menced on Nathan Road, they were met with much opposition from the
public. For them, losses associated with the MTR were felt long before the
benefits arrived. They were unable to envisage the benefits that the MTR
would bring in the future.200 On the other hand, Hongkong Tramways Ltd
worried that its market share would suffer following the opening of the
MTR,201 while other transport operators were concerned about falling profits
in the future. Construction works for the Tsuen Wan Line required the rec-
lamation of 7.4 hectares of land, the resumption of land that was currently
occupied by houses, squatter areas and industrial buildings, the resettlement
of thousands of residents, the purchase of residential units from 3,000 resi-
dents, and the relocation of 153 graves.202
The huge expenditures of the MTR were also called into question. On 14
February 1968, Professor Sean Mackey of the Civil Engineering Department at
the University of Hong Kong pointed out that the immense scale of the plan was
disproportionate to the MTR’s area of coverage, as it could only serve certain
districts of Hong Kong and its passenger traffic would only account for 30 per
199
South China Morning Post, 15 February 1968, p.1.
200
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, p.43.
201
South China Morning Post, 15 February 1968, p.1.
202
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, p.57.
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216 · MAKING HONG KONG
cent of total passenger traffic. He believed that the system would impose a heavy
economic burden on Hong Kong and that it would not be possible for the local
economy to support the MTR project for the following 16 years.203
When the Mass Transit Railway Corporation Bill 1975 was voted on 23 April
1975, a considerable number of Legislative Council members voted against
it. Although the bill was passed, many members believed that the transport
problem could be solved in other ways, such as expanding the Kowloon–Canton
Railway to a double-track system or enhancing tram services. The MTR’s con-
tinued increases in construction costs were not an isolated case, as many past
government construction projects had gone over budget: Airport Tunnel Road
(17 per cent over budget), Clear Water Bay Road (22 per cent over budget),
High Island Reservoir water supply works (40 per cent over budget) and Plover
Cove Reservoir dam (90 per cent over budget). It was estimated that the con-
struction and 20-year operation of the MTR would cost 14 billion Hong Kong
dollars, which would be 140 per cent higher than the 5.8 billion Hong Kong
dollars according to the revised budget. In 1976, the Legislative Council was
informed that interest expense would increase by 100 million Hong Kong
dollars during the four-year construction of the Modified Initial System.204
The challenges of the construction were not limited to controversies over
expenditures. Hong Kong’s granite geology posed an enormous challenge for
tunnel boring works. Sir Wilfrid Newton, Chairman of the Mass Transit Railway
Corporation from 1983 to 1989, recalled that workers had to bore holes through
granite along the sections of the Island Line. There was coarse gravel everywhere,
which was a nemesis to tunnel boring. The greatest difficulty was that many tall
buildings had already been erected along the sections of the Island Line in the
1970s. If the foundations of nearby buildings were not dug deep enough, they
faced a risk of collapse, which would result in temporary evacuation of residents.
The construction would require suitable exploratory and protective works for
the building’s foundations. Soil properties were tested before adopting various
methods to bore tunnels, such as the chilling method that freezes the ground to
facilitate boring.205 For the above reasons, the Island Line was built much deeper
below the ground than the Kwun Tong Line and the Tsuen Wan Line, demon-
strating the difficulty of the works.
As the MTR had a higher passenger carrying capacity than modes of road
transport, road traffic congestion problems were solved after the opening of the
system. Connections between core districts and districts that were previously
considered remote such as Tsuen Wan and Kwun Tong became much closer,
while economic activities along the railway station routes prospered. When
people use the MTR today, do they ever think how this transport system, which
took over ten years in planning and more than a decade in construction, went
203
South China Morning Post, 16 February 1968, p.6.
204
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, pp.46–47.
205
Ouyang Ruohua, Gangtie dongle: sanshiliu zai qingyushi (Moving Experience: The MTR’s First 36
Years), Hong Kong, South China Morning Post, 2011, p.61.
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High-density development planning (1945–1979) · 217
over budget by 460 per cent and generated great controversy among the parties
concerned during construction, became an important part of Hong Kong
people’s everyday life in the twenty-first century and an indispensable element
for Hong Kong’s achievement as an international metropolis?
Summary
Post-war urban planning in Hong Kong was arduous and full of challenges:
insufficient land resources in the city, shortage of economic resources, countless
tasks to be done after the war, an unstable global political situation, and so on,
all of which greatly hindered Hong Kong’s long-term planning and develop-
ment. Among them, the population problem was the most difficult to tackle,
as its growth rate exceeded that of the pre-war period. According to official
records, Hong Kong’s population grew from around 860,000 in September
1943 to 1.8 million in 1947, more than doubling within a short period of four
years and breaking the record of 1.63 million at the peak of the refugee influx
before the Sino-Japanese War in 1938. The figure soared to 2.36 million in the
spring of 1950.206 How could a city that already lacked land resources support
an exponentially growing population? Faced with the problem of population
growth, the government did not opt for policies that suppressed population to
relieve the pressure. On the contrary, it viewed population as an important eco-
nomic resource and driver for urban development and vigorously absorbed the
capital, professional knowledge and human resources brought by the immigrant
population.
The government had already felt the pressure of population growth when
it hired British experts on urban planning to come to Hong Kong to carry out
studies and formulate long-term development blueprints in 1946. After coming
to Hong Kong, the urban planning experts were able to experience first-hand the
surging influx of refugees. After weighing advantages against disadvantages, the
government was unwilling to change its immigration policies and was already
psychologically prepared for the refugee influx. The 1948 long-term planning
took reference from the measures implemented by other cities to tackle popula-
tion growth and compared the benefits and drawbacks of each country, adopted
their strong points and gained a deeper understanding of the aspects where
Hong Kong had room for improvement. The government formulated preven-
tive measures aimed at preparing the city for population growth: developing
rural land on the urban fringes; assessing the population distribution and density
in districts planned for development; emphasising a reasonable level of popula-
tion density, open spaces and green belts that were required by the livelihood of
the grassroots and necessary facilities for daily life; and formulating measures to
disperse population in urban areas. Facing the problems of dismantling squatter
areas and resettling fire victims in the 1950s, the government put back on the
agenda the pre-war public housing scheme. The preliminary planning work was
206
Hong Kong Annual Report, Hong Kong, Government Printer, 1953, p.21.
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218 · MAKING HONG KONG
a very useful reference for the government in tackling the problem of a surging
population in the 1950s and 1960s.
Planning for the political and commercial roles of districts in the urban areas,
New Kowloon and the New Territories such as government administrative
centres, cultural centres, transport interchanges, distribution of offensive trades,
heavy industrial areas, manufacturing industrial areas and distribution of public
housing areas was mainly aimed at coordinating with the development of core
districts and was formulated according to the respective geographical conditions
of each district so that they each could fully realise their potential and fit in with
the overall development of the city. Such a macro-perspective was an advantage
of long-term planning, which was more comprehensive than the pre-war spo-
radic development that relied on private investment. Post-war development of
the districts made the best use of their respective geographical characteristics
and played to their strengths.
The planning and development of external transport effectively enhanced
Hong Kong’s status in entrepôt trade, while the city’s internal transport diverted
population from the densely populated urban areas to the suburbs and rein-
forced the post-war strategy of developing manufacturing industries with imme-
diate impacts. Development of transport systems was an important aspect of
people’s livelihoods. It required large economic investments and a long time to
bring about; it was thus highly controversial in society. Insistence on the feasibil-
ity of a plan has to be backed by solid evidence. On-site investigations carried
out and data collected during planning provided an objective and pragmatic
view regarding whether the plan should be adopted. They helped the plan to
overcome all difficulties and eventually be implemented.
Long-term planning concepts may sometimes encounter hindrances such
as insufficient resources, lack of land, and criticism by various stakeholders in
society, resulting in the inability to immediately implement a plan based on its
original design, while some plans may even be shelved. Organisations and legal
systems established to coordinate with development in the implementation of
plans were the basis for resolving disputes between various parties. Urban plan-
ning was not rendered useless by sudden changes that befell the city; rather,
it was well prepared. Through continuous, appropriate refinements to original
concepts, the city continued to conquer the numerous challenges that it faced
and to thrive in a harsh environment. (See Figure 4.12.)
M4593-HO_9781788117944_t.indd 218 20/08/2018 16:48
M4593-HO_9781788117944_t.indd 219
Source: HKRS41-2A-34-2, ‘Annual Departmental Report – Public Works Department’, Hong Kong, Public Records Office, 1968–1972; or Hong Kong Annual Departmental Report by the Director of Public Works 1969–70,
Hong Kong, Government Printer, 1970.
Figure 4.12 Major development schemes in Hong Kong (1969–1970)
20/08/2018 16:48
5
Approaching the handover
(1979–1997)
We have all been forcefully reminded how vulnerable Hong Kong is to
developments which occur outside our borders over which we have no control.
In May and June, confidence in Hong Kong was badly shaken by the tragic events
in China. People became more nervous about their future. Investors have shown
signs of being more cautious in assessing the territory’s prospects. So we have a
new challenge to meet and new problems to overcome. But this is not the first
crisis that Hong Kong has had to confront. When we have faced difficulties in the
past we have emerged with new confidence and strength. Already there are ample
signs that Hong Kong is showing its usual resilience; that we are facing up to our
problems and finding solutions to them. (Governor David C. Wilson’s speech,
Hong Kong Legislative Council, 11 October 1989)
The 1980s were an era filled with controversies, doubts and worries, an era when
crises became opportunities. Urban development was at times hindered by
political prospects and in others boosted by political turmoil. Many believed
efforts to conduct planning for the unpredictable future during uncertain times
would only be futile; it was a tough task, but some efforts went ahead and perse-
vered. When reviewing the planning process from the 1980s to the 1990s, one
realises that, without a long-term planning scheme prepared at an early stage, it
is difficult to seize opportunities and realise great ideas when the time is ripe. The
Airport Core Programme planned in the early 1980s was an excellent example.
As the ten core projects were laid out step by step in the 1990s, outstanding
infrastructure immediately made Hong Kong an international metropolis; this
showed the importance of long-term planning.
Development strategies in the 1980s
Pursuit of economic growth
As before, conducting long-term planning meant evaluating the future based on
current conditions of development. In the early 1970s, the government released
the Colony Outline Plan, which started with open discussion on urban planning
based on the existing situation and level of development, followed by a pres-
entation of ideas on future development. In 1979, the Colony Outline Plan was
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Approaching the handover (1979–1997) · 221
renamed the Hong Kong Outline Plan; certain contents were deleted, and empha-
sis was given to the foundation of planning. In 1981, the Land Development
Planning Committee (LDPC) established the Planning Standards Sub-
Committee (PSSC), which was responsible for evaluating planning principles
formulated in the Hong Kong Outline Plan. In 1982, the Planning Standards
Sub-Committee proposed drafting the Territorial Development Strategy (TDS)
for the Hong Kong Outline Plan; the planning principles part was renamed Hong
Kong Planning Standards and Guidelines,1 and mainly discussed standards and
guidelines for urban planning. Planning of the Territorial Development Strategy
commenced in the early 1980s and was released in five parts and eight volumes
from 1982 to 1983; its main points included:2
zz developing a diversified economy;
zz evaluating the future housing demand and improving the living environment;
zz developing new towns;
zz predicting land supply and demand;
zz promulgating an approach for future transport development;
zz planning an expansion of port facilities;
zz selecting a site to construct a new airport;
zz expanding higher education.
Economic diversification
When evaluating the employment situation of the ten years between 1971 and
1981 as the foundation for formulating an approach for future economic devel-
opment, it can be seen that the growth rate of manufacturing industry was only
23 per cent, while that of public services reached 65 per cent and that of finance
and commerce reached 161 per cent. Manufacturing industry was predicted to
decline, while the business and service industry would become relatively sig-
nificant. That would result in an economic restructuring. Based on the situation
in 1981, it was estimated that the labour force would rise from 2.416 million
in 1981 to 3.176 million in 1996 and further to 3.437 million in 2001. (See
Table 5.1.)
The labour force in the city centre dropped from 83 per cent in 1971 to 75
per cent in 1981, while the employment rate in the core district, particularly for
white-collar jobs, was still higher than that of the new towns. It was estimated
that the employment rates of the first generation new towns such as Tsuen Wan
and Kwai Chung would rise.3 Employment rates in Tai Po and Tuen Mun were
relatively low, and there was a severe lack of white-collar job opportunities in
1
Hong Kong Planning Department, Hong Kong Planning Standards and Guidelines, Hong Kong, Planning
Department, 2011, Ch. 1.
2
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.7.
3
Territorial Development Strategy, Volume 3: Demographic Inputs, July 1982, Hong Kong, Strategic
Planning Unit, 1982, pp.19–20.
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222 · MAKING HONG KONG
Table 5.1 Evaluation of growth in Hong Kong’s labour force (1981, 1991, 1996, 2001)
1981 1991 1996 2001
Projected population (10,000s) 500 621 669 708.9
Total workforce (10,000s) 241.6 292 317.6 343.7
Percentage of population in workforce (%) 48.3 47.0 47.5 48.5
Distribution of workforce
10,000s 10,000s 10,000s 10,000s
(%) (%) (%) (%)
Manufacturing industry 94.2 109.5 117.5 123.7
(39) (37.5) (37) (36)
Business and other industries requiring a 27.5 43.8 51.5 63.9
central location (11.4) (15) (16.2) (18.6)
Services associated with population 61.7 75.3 82.6 91.1
concentrations (25.5) (25.8) (26) (26.5)
Services not dependent on specific 58.2 63.4 66 65
population concentrations (24.1) (21.7) (20.8) (18.9)
Total 241.6 292 317.6 343.7
(100) (100) (100) (100)
Source: Territorial Development Strategy, Volume 3: Demographic Inputs, July 1982, Hong Kong, Strategic Planning Unit,
1982, Table 9.
the new towns.4 As the new towns were manufacturing hubs, intensive develop-
ment of the transport networks connecting the new towns and the core district
was essential. Meanwhile, developing commercial land use at intersections of
the Mass Transit Railway (MTR) and the railway could increase the number
of non-industrial job opportunities and reduce the burden on the core district.
From the 1950s to the 1970s, manufacturing industry was the core of Hong
Kong’s economy and dedicated to producing low-cost products. This took a
turn in 1980 when the government decided that developing high-quality, high-
technology products could enhance the income of the people of Hong Kong. It
then advised industry to convert from a labour-intensive to a capital-intensive
mode so as to boost the export of such products. Priority was thus given to expand-
ing the capacity of ports and the airport to facilitate the increasing throughputs.
It was predicted that the GDP growth rate in 1982 would reach the minimum
requirement of 9 per cent. In view of the importance of sustaining economic
growth at a minimum of 9 per cent, ways to encourage economic diversification
had to be devised, which could boost the export of goods and labour services.5
Located on the coast of southern China with a prime geographic location, Hong
Kong port became an interchange for China and the Pacific region that could
4
Territorial Development Strategy, Volume 3: Demographic Inputs, July 1982, Hong Kong, Strategic
Planning Unit, 1982, pp.24–27.
5
Hong Kong Advisory Committee on Diversification, Report of the Advisory Committee on Diversification,
1979, Hong Kong, Advisory Committee on Diversification, 1980, p.109.
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Approaching the handover (1979–1997) · 223
be developed into a trade and financial centre. Victoria Harbour was a natural
good-quality port with deep waters. In terms of the economy, the international
airport in Hong Kong could boost entrepôt trading in the city and help develop
it as a commercial and financial centre.
Enhancing the education level for all
Under the economic diversification policy, the labour force would have to
possess a certain level of professional knowledge to acquire and apply new
technologies. Fields such as business administration, economics, accounting,
engineering and data processing were in need of more professionals and tech-
nical talents. The government’s social services, urban development and plan-
ning required a large number of engineers, architects, lawyers, social workers
and doctors. Higher education facilities had to be expanded.6 The two univer-
sities could only provide 7,000 extra places based on an annual growth rate
of 4 per cent each year. Such measures were expected to be implemented in
the University of Hong Kong in 1987/88, while for the Chinese University of
Hong Kong it would happen in 1989/90. It was thus necessary to construct
the third university in the early 1990s – the Hong Kong University of Science
and Technology. The Hong Kong Polytechnic would have to add 8,000 places
and greatly increase the number of non-degree programmes. Located in Hung
Hom, the Hong Kong Polytechnic would need to be expanded to accommodate
13,500 full-time and part-time students. In addition, the government had to
prepare to build a second polytechnic that would provide at least 8,000 full-
time places. Two additional technical institutes were also suggested in order to
nurture more professionals.
Housing and land development strategies
The housing problem was still a focus of long-term planning in Hong Kong in
the 1980s. The housing policy under which public housing was constructed
to fulfil the needs of the grassroots was revamped with the ten-year housing
development programme in 1972. Apart from increasing the public housing
supply, the living environment also had to be improved, including improv-
ing construction materials for buildings, lowering the population density
in public housing, enhancing support facilities for public housing residents
and keeping the rent at one-fifth of the grassroots’ household income. In
the 1980s, the continuing growth in the number of immigrants and nuclear
families resulted in a surge in the demand for small flats with their own
kitchens and bathrooms. In view of this, the public housing policy had to be
adjusted correspondingly. On the other hand, the demand for purchasing
self-occupied flats continued to rise as household income increased. Apart
6
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, pp.11–12.
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224 · MAKING HONG KONG
Table 5.2 Number of different types of flats in Hong Kong (1973/74–1981/82)
Year Public rental Private Home Ownership
housing housing Scheme
1973/74 8,500 24,000 –
1974/75 9,800 19,200 –
1975/76 17,100 14,200 –
1976/77 10,100 16,800 –
1977/78 13,500 22,200 –
1978/79 15,300 27,000 –
1979/80 33,000 28,500 2,400
1980/81 36,100 23,400 8,700
1981/82 35,000 32,000 4,400
Source: Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic Planning
Unit, 1982, Figure 18.
from public housing, the government also had to construct housing for the
middle class to purchase.7 (See Table 5.2.)
In 1981, there were 1.24 million households in Hong Kong, 829,000 of which
lived in flats built with sturdy materials and equipped with kitchen and bath-
room facilities, but around 411,000 households still lived in poor conditions.
Among the 1.24 million, 31 per cent were single- or two-person households.
According to an evaluation by the Secretary for Housing in 1981, if some of the
small families were allowed to share a flat, the shortage of housing with more rea-
sonable living conditions could be adjusted to 265,000 flats. With this number,
the ratio of demand among public housing, housing for the middle class (includ-
ing the Home Ownership Scheme (HOS), Private Sector Participation Scheme
(PSPS) and Middle Income Housing Scheme (MIH)) and private housing
would be 65:20:15.8 However, the quality of living for residents could not be
truly improved if two nuclear families had to share a flat.
The government estimated that the population in Hong Kong would rise to
5.4 million in 1986 and the number of households would rise to 1.487 million, which
would represent an increase of 300,000 people and 242,000 households respec-
tively.9 In the five years between 1981 and 1986, around 25,000 private housing
flats could be supplied each year, and around 40,700 public housing flats, includ-
ing those of HOS, PSPS and MIH, were planned to be supplied each year.10 Up to
1986, 328,500 flats could be provided, while the shortage would still be as high as
178,500 flats. There were 480,000 private flats in 1981. This was estimated to rise to
7
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, pp.41–42.
8
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.47.
9
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, Figure 12.
10
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.47.
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Approaching the handover (1979–1997) · 225
624,000 in 1986, while public housing flats equipped with kitchens and bathrooms
would increase from 349,000 in 1981 to 540,000.11 Together with the demand for
410,000 flats in 1981, the housing demand would amount to around 710,000 flats.
After deducting over 300,000 newly added flats, more than 300,000 households
would still be in need of better housing. It was estimated that the Hong Kong popu-
lation would grow to 6.2 million in 1996 and the number of households would
grow to 1.9 million. An additional 420,000 households would be formed between
1986 and 1996. The government had planned to provide 400,000 to 490,000 flats
from 1986 to 1996.12 From the above projection, the government estimated that
a total of at least 65,000 public and private flats needed to be provided each year.
To increase the housing supply, the housing development programmes which
had already been launched in the urban area and new towns, including Tsuen
Wan, Sha Tin, Tuen Mun, Tai Po, Fanling, Sheung Shui and Yuen Long, would
continue. Ma On Shan in Sha Tin and Tseung Kwan O would be the key areas
for development in the 15 years from 1981 to 1996. For the long-term planning
and investments of large-scale transportation systems, the planned population
of these two areas would take reference from the MTR’s maximum passenger
capacity of 175,000, at an early stage of development.
The Territorial Development Strategy stressed that land available for develop-
ment in the urban areas would not be able to meet the population’s needs within
a short period of time. In terms of medium-term development, the growth in
land supply would decrease gradually from around 1,100 hectares in 1981/82
to 12 hectares in 1989/90. Around 75 per cent of land supply was from the new
towns.13 For land in the urban area, it was close to public transport systems and
centres of employment, also equipped with comprehensive community facili-
ties, and had the potential to be redeveloped for residential use. It was estimated
that around 290 hectares of such land could be developed into private housing
and over 80 hectares could be developed as Type I or II public housing estates.
Additionally, about 450 hectares of land was for squatter use or temporary
use. Development of such land would be more efficient in terms of resources
and time, compared with new town development,14 and would be available
for various social and economic uses after replanning. Based on the evaluation
above, it was proposed to replan land in the urban areas. (See Table 5.3.)
The Special Committee on Land Supply proposed to provide sufficient land
for light and manufacturing industries in 1990/91 to meet their needs. It was
estimated that private high-density housing might reach an equilibrium in
1985/86 but might face a shortfall thereafter; private medium- and low-den-
sity housing could meet the long-term demand; public housing and HOS were
11
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, Figure 20.
12
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.49.
13
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.52.
14
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.53.
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226 · MAKING HONG KONG
Table 5.3 Prediction of land supply in Hong Kong (1981–1991)
Year Urban areas New Territories Total
(hectares) (hectares) (hectares)
1981/82 733 358 1,091
1982/83 359 222 581
1983/84 564 137 701
1984/85 509 91 600
1985/86 337 145 482
1986/87 259 58 317
1987/88 159 38 197
1988/89 80 20 100
1989/90 12 0 12
1990/91 107 3 110
1991 356 60 416
Source: Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic Planning
Unit, 1982, Figure 215.
expected to accumulate a shortfall after 1987/88; and PSPS and MIH could
meet the medium-term demand.15
Strengthening Sino-Hong Kong trade linkages
In late 1978, China announced the implementation of its economic reform
policies, which directly affected the trade linkages between Hong Kong and
China. In the early 1980s, the government proposed to develop ‘entrepôt facili-
ties’ for long-term planning16 and was concerned about Hong Kong’s interac-
tion with southern China, in particular nearby Shenzhen and Shekou.17 The
corridor between Hong Kong and Guangzhou became urbanised in the early
1980s, while growth in the Pearl River Delta’s rural economy was substantial.
According to the TDS, the continuing growth of Shenzhen Special Economic
Zone (see Table 5.4) was anticipated to be the driving force for close linkages
between China and Hong Kong.18 China planned to accommodate a total popu-
lation of 1 million in Shenzhen. There were 720 agreements (with a total value of
2.4 billion Hong Kong dollars) made between Shenzhen and foreign companies
and Chinese enterprises from Hong Kong, Macao and overseas, 548 of which
had already been implemented. As the labour cost and rent in Shenzhen were
15
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.52.
16
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.8.
17
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.9.
18
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.18.
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Approaching the handover (1979–1997) · 227
Table 5.4 Development characteristics in various districts of Shenzhen Special Economic
Zone
District Characteristics
Shekou Industrial and port development
Lowu Commercial area and government offices
Shangbu district (today’s Futian district) Light industry and housing development
The eastern sector Scientific and cultural area, and tourist zone
Source: Territorial Development Strategy Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic Planning
Unit, 1982, p.10.
cheaper than those of Hong Kong, where low-cost industries faced difficulties in
operating, Shenzhen could continue to develop low-technology industries. On
the other hand, 300,000 people in Shenzhen worked in the agricultural sector,
which mainly included chicken farms, fisheries and other forms of agriculture.
Agricultural development in Shenzhen could solve the food supply problem in
Hong Kong and was crucial to the economy of both Hong Kong and Shenzhen.19
It was thus necessary for the Hong Kong government to maintain close linkages
with the southern China region and international business institutions.20
To strengthen linkages between Hong Kong and the Pearl River Delta, the
government planned to improve transportation between China and Hong
Kong. On the air transport aspect, flights between Hong Kong and Guangzhou
Baiyun International Airport were launched in 1979, and more routes connect-
ing China were added. At the same time, future development of the new airport
in Hong Kong took into account the air cargo services between China and Hong
Kong.21
For maritime transport, freight transport between Hong Kong and China
increased from 4.8 million tons in 1977 to 8 million tons in 1980, a growth rate
of 67 per cent. Net tonnage of registered ocean-going vessels increased from
717,000 tons in 1975 to 3.276 million tons in 1980; net tonnage of registered
river vessels increased from 2 million tons in 1975 to 2.2 million tons in 1980. It
was estimated that maritime transport between Hong Kong and China would
grow by 6–10 per cent per annum over the following five years; the improve-
ment of the navigation channel of Ma Wan Channel in Hong Kong was thus
planned to facilitate navigation of large trade vessels from Pearl River, and
the addition of port facilities was planned.22 In 1979, ferry services between
Hong Kong and Guangzhou were relaunched, and a service from Hong Kong
19
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.10.
20
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.12.
21
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.18.
22
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, pp.18–19.
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228 · MAKING HONG KONG
to Qingdao was provided.23 Maritime transport from Hong Kong to the Pearl
River Delta was developed, while sea access between Deep Bay and Shekou
opened.
For land transport, the Kowloon–Canton Railway carried 500,000 passen-
gers between Guangdong and Hong Kong every year. There was also a growth
in cargo transportation from 1.5 million tons in 1975 to 1.9 million tons in 1980.
According to the Territorial Development Strategy, demand for railway-based
passenger and cargo transport on the railway was expected to increase owing to
the industrial modernisation in China.24 The Kowloon–Canton Railway had to
implement electrification and conversion to a dual-track system so as to meet
such an increase in demand.25 (See Figure 5.1.)
Before the late 1970s, goods transported to China by highway were far less
significant than those transported by railway. Goods transported to China via
Man Kam To increased from 68,500 tons to 309,100 tons in 1980. The cargo
volume increased to 5 million tons in 1985; there were thus plans to construct
control points at Sha Tau Kok and Man Kam To in the north-eastern New
Territories and at Lok Ma Chau in the north-western New Territories.26 It was
also expected that highways connecting Hong Kong and Guangzhou would be
completed by the late 1980s. By then, the daily volume of cross-boundary vehi-
cles would have grown to 8,000 as economic activities in Guangdong Province,
particularly Shenzhen Special Economic Zone, increased.27 To strengthen
Hong Kong’s role in entrepôt trades, the government actively developed trans-
portation facilities at ports, and airport and feeder services for connection with
China,28 such as container terminals, the airport, road links between major
industrial districts, and business and hotel hubs. Meanwhile, Pearl River trans-
shipment and passenger transit facilities were also enhanced to fulfil the ever
growing demand. (See Tables 5.5 and 5.6.)
Development of transport between Hong Kong and China not only facili-
tated development of the region, but also was beneficial to the development of
23
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.19.
24
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.19.
25
In 1974, the Kowloon–Canton Railway introduced a ten-year project, with the work involving dou-
ble-tracking and electrification of the section from Hung Hom to Lo Wu. Simultaneously, other works
began, including the construction of the second Beacon Hill tunnel, the construction of new stations, and
reconstruction of existing stations and facilities. The first phase of the project was completed in 1982;
the electrification and double-tracking work between Hung Hom and Shatin stations was completed in
May. On 16 July 1983, full double-tracking and electrification between Hung Hom and Lo Wu stations
was completed, and diesel-hauled passenger trains ceased to run. The diesel locomotives were retained
only to haul freight. Kowloon–Canton Railway Corporation website, www.kcrc.com/tc/engtxt/corpo-
rate_profile/history.html.
26
Territorial Development Strategy, Volume 4: A Review of Current Development Programmes, Final, May
1983, Hong Kong, Strategic Planning Unit, 1983, pp.4/10–4/11.
27
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.20.
28
Territorial Development Strategy, Volume 5: Derivation and Evaluation of Alternative Strategies, May 1983,
Hong Kong, Strategic Planning Unit, 1983.
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M4593-HO_9781788117944_t.indd 229
Source: Hong Kong Planning Department, Territorial Development Strategy Review – Development Options, Hong Kong, Planning Department, 1993, p.15.
Figure 5.1 TDS review of Hong Kong and neighbouring regions (1993)
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230 · MAKING HONG KONG
Table 5.5 Figures on cargo volume of Hong Kong trade with China (1974–1981)
Year By sea By rail By road Total by
land
To China From Total To China From Total To/from (’000
(’000 China (’000 (’000 China (’000 China tonnes)
tonnes) (’000 tonnes) tonnes) (’000 tonnes) (’000
tonnes) tonnes) tonnes)
1974 185 2,256 2,442 1 1,162 1,163 71 1,234
1975 123 2,775 2,898 1 1,481 1,482 69 1,551
1976 75 3,076 3,150 1 1,421 1,422 72 1,494
1977 92 3,160 3,252 1 1,447 1,448 81 1,529
1978 86 3,997 4,083 1 1,832 1,834 71 1,905
1979 215 4,893 5,108 4 1,938 1,942 139 2,081
1980 477 5,673 6,150 7 1,943 1,950 308 2,257
1981 601 6,714 7,315 7 1,773 1,780 525 2,305
Source: Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic Planning
Unit, 1982, p.19.
Table 5.6 Figures on Hong Kong trade with China (1977–1980)
Year Value of Hong Value of Hong Value of Total (1980 prices)
Kong’s exports Kong’s retained re-exports from (HK$ million)
to China imports from China via Hong
(HK$ million) China Kong
(HK$ million) (HK$ million)
1977 31 5,590 2,492 8,113
(11,268)
1978 81 6,891 3,659 10,631
(13,806)
1979 603 9,467 5,633 15,703
(17,236)
1980 1,605 13,554 8,394 23,553
(estimate) (23,553)
1977–1980 +5,077 +142 +237 +190
change (%) (+109)
Source: Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic Planning
Unit, 1982, Table 1.
oil exploration and related industries as well as economic collaborations with
Shenzhen and Zhuhai Special Economic Zones.29
29
Territorial Development Strategy, Volume 1: An Introductory Statement, April 1982, Hong Kong, Strategic
Planning Unit, 1982, p.10.
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Approaching the handover (1979–1997) · 231
Before and after the Sino-British Joint Declaration
While the government was planning to strengthen trading between Hong Kong
and China, China proposed that Hong Kong should be returned to China in
1997. From 22 to 25 September 1982, the British Prime Minister, Margaret
Thatcher, visited Beijing and began to negotiate with the Chinese government
on the issue of Hong Kong sovereignty. On 24 September, the two countries
released a joint declaration; the Xinhua News Agency stated that ‘the Chinese
government’s stance regarding the sovereignty of Hong Kong is clear and uni-
versally known’, while Britain also consented tacitly that the Communist Party
of China held the sovereignty over Hong Kong.30 Before the negotiations,
Thatcher still wished for an exchange of sovereignty for administrative power but
failed to achieve it.. The Sino-British negotiations had significant impacts on the
government’s long-term planning for Hong Kong. The site for the new airport
had been selected, but the plan was scrapped, and later put on the agenda again.
Its eventual implementation was affected by the change in political climate.
Planning of the new airport
In the 1970s, the Hong Kong economy soared as the world economy grew, and air
transport facilities at Kai Tak Airport could no longer cope with the demand. The
idea of constructing a new airport to cope with the growing demand for air trans-
port in Hong Kong emerged as early as 1973. The Civil Aviation Department’s
Governmental Steering Group hired the Ralph M. Parsons Co. to investigate the
long-term development approach for the city’s air transport system, and 26 sites
for the new airport were identified and discussed.31 In January 1975, the Ralph
M. Parsons Co. released the Hong Kong Air Transport System Study on Long Term
Planning. The government soon established the Aviation Advisory Board, which
was responsible for evaluation of the consultants’ suggestions for future air trans-
port development. Focus of the discussion was whether Kai Tak Airport should
be rebuilt or a new site should be sought for a new airport.
In 1975, constructing a new airport became the mainstream proposal to cope
with the growing air transport industry in the future. For site selection, 13 loca-
tions were identified by the Ralph M. Parsons Co. The 13 locations were Ha
Tsuen, Brothers Point (in the north of Lantau Island between Tung Chung and
Tuen Mun), Discovery Bay on Lantau Island, Sunshine Island (between Peng
Chau and Hei Ling Chau), Mang Kung Uk (Clearwater Bay Peninsula), Tide
Cove, Shek Kong, Nim Wan near Deep Bay, San Tin, Tolo Channel, Cheung
Chau, Lamma Island and Chek Lap Kok near Lantau Island. These 13 loca-
tions were compared against four basic criteria to see whether any of them were
suitable:
30
Kung Sheung Daily News (Industrial and Commercial Daily), 25 September 1982, p.1.
31
Hong Kong Annual Departmental Report by the Director of Civil Aviation 1973–74, Hong Kong,
Government Printer, 1974; Hong Kong Air Transport System: Long Term Planning Investigation: Alternative
Systems Study, Hong Kong, Civil Aviation Department, 1975.
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232 · MAKING HONG KONG
1. compliance with international aviation safety regulations, including no
obstructions on the landing and departure flight paths, suitable wind direc-
tions, sufficient space above the flight paths to ensure aviation safety, and
sufficient space to construct runways, aprons, passenger terminals, fuel tank
farms and aircraft maintenance areas;
2. level of engineering difficulties and cost-effectiveness of the projects;
3. transport networks, such as roads and railways, for connection to the airport;
No comments yet.
Private notes are available after approval.