24 April 2019
The government should streamline its current policies to encourage public-private partnerships as a means to boost land supply. Photo: ISD
The government should streamline its current policies to encourage public-private partnerships as a means to boost land supply. Photo: ISD

PPPs present viable means to substantially boost land supply

According to a public consultation paper published by the Task Force on Land Supply, Hong Kong’s land shortage is estimated to reach 815 hectares by 2026 and worsen to 1,200 hectares by 2046.

Even if the government managed to find new sources of land, it would still take at least 11 to 14 years to complete all the planning and procedures required to develop the sites for housing.

In other words, the chances of us being able to meet the estimated demand for land by 2026 are quite remote.

As such, resorting to public-private partnerships (PPPs) appears inevitable as a means to substantially boost the city’s land supply.

In order to address public concern about potential government-business collusion, it is very important for the administration to establish a transparent mechanism to guarantee procedural justice and ensure extensive participation of the private sector.

In particular, the government must enhance oversight of each and every part of any PPP project such as the building of infrastructure, the payment of land premiums, cost control and construction quality.

To do that, the administration can consider setting up a rural housing authority, under which PPP projects will be carried out based on the market model.

On the other hand, another major issue related to land supply is the “Tso and Tong land” (TTL), i.e., land collectively owned by indigenous clansmen in the New Territories.

The TTL is actually a tradition of the old Chinese agrarian society that dates back to ancient times.

Currently, there are a multitude of TTL lots scattered in agricultural land across the New Territories. However, the fact that the sale of TTL lots is strictly regulated has seriously limited the potential for combined development of existing agricultural land and reduced our overall land supply.

In the past, all it took for indigenous clansmen to sell their TTL lots was the green light from their district officer, who would always grant approval as long as there wasn’t much opposition from the clans.

But as our society has become increasingly politicized in recent years, district officers are getting more and more cautious when it comes to approving TTL sales.

In most cases nowadays, district officers require the unanimous decision of all the clansmen who own the land before giving the thumbs up and signing the papers.

The plummeting sales of TTL lots due to red tape have simply exacerbated Hong Kong’s land shortage.

Given that, I believe the government should streamline its current policies on TTL and introduce measures that would facilitate the sale of these land lots in order to fundamentally address the issue of land supply in our city.

This article appeared in the Hong Kong Economic Journal on Sept 1

Translation by Alan Lee

[Chinese version 中文版]

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