20 January 2019
Mainland parallel traders have been overwhelming the city's bus routes and railway system with their bulky cargoes. Photo: HKEJ
Mainland parallel traders have been overwhelming the city's bus routes and railway system with their bulky cargoes. Photo: HKEJ

Border shopping center: the right solution to parallel trading?

Parallel traders are becoming an increasingly annoying — and, some think, insolvable — problem for Hong Kong.

Chief Executive Leung Chun-ying has revealed government plans to build a shopping center that will mainly serve mainland shoppers. Daily necessities such as diapers, formula milk, Yakult, chocolates and other items will be available in the mall.

According to a government source, the shopping center, covering an area of 400,000 square feet, will be opened near the Lok Ma Chau border this September.

The mall can absorb the usual mainland shopping rush during the national holiday in October, Southern Metropolis Daily reports.

Currently the site is a car park, but the tenancy will expire in May. The government is reportedly still holding talks with the landlords.

Demand for Hong Kong products across the border has remained strong following a series of food safety and product quality scandals on the mainland.

Despite an intensified crackdown by authorities, parallel trading continues to thrive as smugglers are lured by the prospect of huge and easy profits from buying daily necessities in Hong Kong and reselling them in Shenzhen.

The situation is expected to get worse as mainlanders rush in to stock up on goods for the coming Lunar New Year. Just a few days ago, state media even gave tips for mainland shoppers in Hong Kong.

Opening a shopping center near the border can solve much of the problems associated with parallel trading. Mainland traders who overwhelm the city’s bus routes and railway system with their bulky cargoes can now do all their shopping in a centralized location.

The proposed shopping center will work like outlets. Other than foods and necessities, sports brands such as Nike and Puma will have their own stores in the mall.

However, a dilemma exists: if we build a shopping mall especially for mainland shoppers, are we not encouraging them to smuggle and evade taxes, thus breaking mainland laws?

North District Parallel Imports Concern Group’s spokesman Ronald Leung Kam-shing thinks the proposed shopping center will do no good to Hong Kong people.

“It is another way of officially saying that smuggling is acceptable,” Leung said. “The shopping center will attract more parallel traders flooding the city and smuggling products across the border.”

To stem the overwhelming smuggling activities, Fan Ling Court principal magistrate Bernadette Woo Huey-fang sent a parallel trader of infant formula products straight to jail for carrying more than a dozen milk powder cans across the border on Wednesday.

Woo said although she knows that the smuggling activities originated from social problems (the quality control of mainland products is substandard), parallel trading has become rampant and out of control.

That’s why she decided to be stricter on first-time offenders and set an example for others.

But while the courts are becoming stricter and starting to send parallel traders behind bars, the government is planning to build a shopping center to accommodate the parallel traders and encourage them to smuggle. Isn’t that self-contradictory?

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EJ Insight writer

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