The price of farmland in rural areas is likely to surge, as the government may soon begin to assemble land for the establishment of an agricultural park, the Hong Kong Economic Journal reported Tuesday.
Market observers said the plan may give a big boost to the farmland premium for the third time, after the government’s efforts in the past to assemble land for the construction of the high-speed rail link and for the development of new towns in the northeastern New Territories.
At present, developers or individual buyers are paying HK$500 (US$64.50) to HK$600 per square foot for farmland with direct road access to downtown. Farmland in remote areas fetches about HK$180 per sq ft.
The government has been paying HK$969.60 per sq ft for land it has been accumulating for the construction of major infrastructure or new downtown developments.
Otherwise, the compensation would be discounted from the base rate of HK$808 per sq ft.
As part of its efforts to boost agribusiness, the government unveiled proposals Monday to build an agricultural park 70-80 hectares in size.
The site will probably in the Kwu Tung North new development area, in the northeast New Territories, covering Yin Kong, Long Yuen and Ho Sheung Heung, the newspaper quoted an unnamed source as saying.
Agribusiness in Hong Kong has been declining over the past few decades. Only 16 percent of the 4,523 hectares of farmland is used routinely for farming.
About 4,400 people continue to earn their living from farming, official figures show.
Dr. Ko Wing-man, the secretary for food and health, said his bureau expects the plan to bring HK$200 million in annual revenue to the agricultural industry.
However, Ko said, it may take a few years to complete the establishment of the park.
The government also proposed setting up a Sustainable Agricultural Development Fund to provide financial support for research and development in applied technology for agricultural production, enhance manpower training and improve the agricultural infrastructure.
A consultation on the government’s proposals will last until the end of March.
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