ASIAN AFFAIRS ANALYSIS ON HONG KONG THE RULES OF WORL CITY Plentiful historical data from former world-cities uncovered three rules to apply to them. Are they still in force in Hong Kong? We shall see that they are not. Rule one is that if the boundaries of a world-economy change slowly, they do change. ‘The limits on one world-economy, Fernand Braudel wrote, can be thought of as lying where those of another similar one begin: they mark a line, or rather a zone which it is only worth crossing, economically speaking, in exceptional circumstances.’ In his 2003 Policy address, C.H. Tung, outlining that the future of Hong Kong lies in the Pearl River Delta, acknowledged such a fact. His declaration was an unmistakable admission that the boundaries of Hong Kong have shifted. The admission is all the more significant that in 2002, not only didn't he mention it at all, but his own administration was objecting to a critical connection to the Pearl River Delta, a bridge between Lantau (Hong Kong) and Zhuhai and Macao across the estuary of the river. The Secretary for Transport went as far as saying that such a bridge would not be needed before 2020. Less than twelve months later, C.H. Tung stated the reverse, saying it was an urgent necessity (2). As a general rule, the frontiers of a world-economy have always been quiet zones, ‘the scene of little activity’. It was within the limits imposed by such difficulties that world-economies became established, grew, survived, and developed. For a long period of time, the Hong Kong’s economic frontier was the scene of little activity. From the 1950's, to roughly the end of the century, the colony was the last frontier beyond which started a despised economic no man’s land: China. Of course, in those days, Shenzhen did not exist and Guangzhou was in the doldrums (3). The second rule of a world-economy is that it always has an urban center of gravity, a city, as the logistic heart of its activity. News, merchandise, capital, credit, people, instructions, and correspondence all flow in and out of that center. What better description of Hong Kong could we have? Indeed its vibrant financial center, its modern telecommunication facilities at a time where one Chinese out of one hundred was lucky to have a telephone line, its airport, the only international one within a thousand miles, its deep-water port, the only one of the South China coast, its multinational environment, its banking system and stock market, its bilingualism, made it indispensable. In those days, where else would one go anyway? China was still a forgotten country. Fernand Braudel noted that powerful merchants have invariably controlled world-cities. In the process, they were always becoming extraordinarily wealthy while laying down the law without bothering to assume the direct management of the city. Again here, the description fits very well Hong Kong, whose powerful elite, in the 1970's embodied by Y.K. Pao the shipping magnate, nowadays by Li Ka-shing, never held any official responsibilities in the city, leaving such menial tasks to their underlings. World-cities are never isolated. They do not function in a vacuum. Generally there are other cities playing the role of associate or accomplice, generally resigned (for a while) to their second-class role. Hong Kong’s reach went as far as Taiwan and even Singapore. The activities of those associates were subordinated to those of the metropolis: at the onset they directed the flow of business toward it, redistributed or passed on the goods it sent them, used its credit, benefited from its services and wealth. Later in the process, they invariably tend to adjust to tailor their activities according to the standard of the center. Such a process is actually the first sign by which a world-city is recognized. Thus the loss of its retinue of assistants and subordinates is a sure sign of change in its status. As it is, Hong Kong has witnessed such a loss which is expressed by the vagueness of the Guangzhou officials and the stern attitude of the Shenzhen municipality (4), when dealing with cross-border issues and planning their future, towards Hong Kong's officials. Perhaps the most distinctive characteristic of all the world-cities was their pronounced social diversification. They all had a proletariat, a bourgeoisie, and a patriciate, the later controlling all wealth and power and so self confident that it did not need to deal in politics. Eventually the elite and the proletariat grow further apart, as the rich became richer and the poor even poorer. Nowadays, Hong Kong’s poor are increasing as we shall see, and the divide between the rich and the poor has never been so wide. It has political implications in the long term that might affect adversely the stability of the city, as was the case with its predecessors on the world stage. A sure sign of success of the world-cities was their constant high cost of living, their permanent inflation resulting from the intrinsic nature of the higher urban functions whose destiny was to dominate adjacent economies. Notwithstanding, economic life flowed spontaneously towards their high prices. In the heyday of London, or Amsterdam, Venice, Antwerp to name a few past world-cities, the cost of living sometimes reached an intolerable level, just as New York today is losing its Fortune 500 companies and many other businesses, leaving the city to escape the huge costs of local rates and taxes. And yet, these great urban centers appeal too strongly to interest and imagination not to be heard, as if the people from all walks of life, poor and rich alike hope to grab part of its wealth. An important lesson coming from historical data is that no world-city has ever been cheap. To be a world-city means to be expensive, as if wealth breeds wealth. And whenever a world-city becomes a cheap place, it is the sign that it has lost its attraction and is therefore no longer what it was. Cities become world-cities not because they are competitive, but because they assume an economic function with unparalleled mastery. Therefore, the prolonged deflation surrounding the economic activities of Hong Kong, while being presented as a positive sign, should be considered as a negative one that underlines its fall. Why should Hong Kong be over-worried by such a loss of status? It is only a matter of perception, as the lesson of history is that dominant cities do not dominate forever. Nevertheless, is it the end of the world when it happens? Not all the time although some may suffer more than others. Amsterdam and London have survived very well and if we look at their inhabitants, they are certainly better off today than they were in the heyday of the city, so we should not confuse two issues (5). Notwithstanding, when one world-city replaces another, as was the case in about 1929 when New York upstaged London, it is always the sign of a massive historical shift of forces, revealing the precariousness of the previous equilibrium and the strengths of the one replacing it. In Asia, there is an interesting precedent in China. When in 1421 the Ming rulers left Nanjing for Beijing, the massive world-economy of China turned its back to an economy based on ease of access to seaborne trade to a landlocked trade. Beijing was deep in the interior and started to draw everything towards it. The choice, whether consciously made or not, was decisive. China was turning its back to the world. The third rule of a world-economy is that there is always a hierarchy of zones within. While the different zones within it face towards the center of gravity, they combine in many ways to form a whole. Once such connections were established, they lasted. The zones circle the center of gravity in concentric circles of activities of unequal exchange. This inequality has its origin and its genesis. But any alteration of its pattern directly affects its center. Economic forces move like typhoons do. The eye keeps being at the center. A shift of the forces will result in a shift of the center. And today there is no doubt that the breadth and the depth of the economic development in China has definitely alter the previous pattern upon which Hong Kong built up its reputation. Of course, world-cities may vary in more than one aspect. Historical data provide the clues to their development and their differences. They might be more or less firmly controlled and endowed with variable value of the weapons of domination: shipping, trade, industry, credit, as well as political power. But all share the same history and an identical fate. (The notes are at the end of Chapter one - see Notes Chapter One) | |||
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