Is Hong Kong Lurching Toward An Industrial Policy?
May 4, 1999
Hong Kong leaped forward and flourished by adhering to laissez- faire economics. But a recent government decision to subsidize an industrial park there has many questioning whether the former British colony is succumbing to industrial policy temptations.
- The government has announced it will award land worth $777 million to a private company to develop the high-tech industrial park, known as Cyberport.
- Led by Chief Executive Tung Chee Hwa, supporters claim to want to position Hong Kong as a high-tech industrial hub for Asia, and warn that "rigid" adherence to laissez-faire economics would force Hong Kong to fall behind its neighbors in the technology race.
- The cost of the project is estimated at $1.7 billion to $2.6 billion.
- Opponents point out that the facilities the park would provide are already available in Hong Kong's central district to tenants willing to pay the price.
The centrally-directed nature of the project shows through in the words of a Cyberport spokesman who says that in choosing tenants for the project, the government will "focus on companies which apply the most advanced information technology, and only the leading-edge companies would be admitted into the Cyberport."
In other such projects in many lands, governments have had very poor track records when it came to doing the choosing.
Source: Bretigne Shaffer (Asian Wall Street Journal), "Et Tu, Hong Kong?" Wall Street Journal, May 4, 1999.
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