20 April 2018
A poster on the internet mocks CY Leung for aiming to 'liberate' Hong Kong with his comrades. Meanwhile, Link REIT merely follows the rules of capitalism. Photos: internet, HKEJ
A poster on the internet mocks CY Leung for aiming to 'liberate' Hong Kong with his comrades. Meanwhile, Link REIT merely follows the rules of capitalism. Photos: internet, HKEJ

Mr. Leung discovers how capitalism works … or does he?

He’s just like the son who pleads for clemency after killing his parents, on grounds that he is now an orphan.

The he is, of course, Chief Executive Leung Chun-ying, who has the cheek to criticise Link REIT for behaving just like a commercial company that does not pay sufficient attention to its social responsibilities.

How on earth did he think that Link would behave after the government gave it most of Hong Kong’s publicly owned markets and adjacent properties to manage?

What is it that Mr. Leung, who has spent most of his life working in the property sector, does not understand about how the industry works?

Maybe this sudden concern about Link’s activities comes as Mr. Leung contemplates what he can do about his unpopularity. A populist gesture might just be the fix he seeks.

It is hard to think of another explanation for suddenly noticing that Link is behaving just like other commercial companies.

Low-cost individual stores and stalls are being squeezed out of Link properties and replaced by the big chains that charge big prices.

It is not just the small storekeepers who are being forced out but also various service providers who used to be around when these places were under public ownership.

Unsurprisingly this has led to a high volume of complaints, and Mr. Leung has vowed to do … well, what exactly?

He has ruled out taking these premises back into public ownership and does no more than speak vaguely about how he will look more carefully at the company’s operations.

What he will find is what he has already discovered, namely that Link REIT operates like other property managers seeking to maximize profit.

And there really is no need for Mr. Leung to express surprise that the company’s managers are rewarded on the basis of how much money they can screw out of their hapless tenants.

Is he really trying to say he has never come across this in the property business?

Moreover, as Link itself has just pointed out, it is a public company and therefore, in law, has a primary responsibility to its shareholders.

As Hubert Chak, one of the company’s directors, rather bluntly pointed out, there is “a difference between social corporate responsibility and social welfare”.

So the Link can make all the usual blah, blah, blah, noises that other listed companies make when talking about social responsibility, but this is mainly window dressing — what happens behind the window is what really matters.

All of this begs the question of why the areas under Link control, most of which are in close proximity to low-cost housing, were handed over to the private sector in the first place.

The answer is to be found in the semi-coherent ideology that guides the Hong Kong government. This ideology is semi-coherent because it is so often contradictory.

On the one hand, it lauds the bloated and self-satisfied government bureaucracy, which believes that it generally knows more than anyone else and seeks to regulate and meddle in far too many areas of life.

On the other hand, it follows some of the free-enterprise ideology it espouses, so when it comes to things that would actually require the bureaucrats to manage and improve facilities, they are quite happy to have someone else do it.

They can then hold up transfers of public property and resources to the private sector as an example of why Hong Kong (don’t laugh) has the “world’s freest economy”.

There is a particular carelessness in these matters when it comes to facilities that serve the less well off members of the community.

Thus not only were the markets handed over to the private sector, but other commercial facilities, previously run by the Housing Authority, were also transferred to the private sector.

Private companies have also been engaged to handle matters such as security and cleaning of public buildings.

Maybe these mundane tasks are seen as being below the dignity of the fine bureaucrats who are busy focusing on other things, such as sorting paper clips.

Next we will discover that CY Leung is appalled to learn that some of the private company security guards stationed in public buildings are not in the first flush of youth but are there because they cost less.

– Contact us at [email protected]


Hong Kong-based journalist, broadcaster and book author

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