Death knell? Hong Kong’s five-year plan is a starting gun

Hong Kong's decision to draft its first five-year plan has sparked controversy, with some fearing the move will burden the city's thriving laissez-faire economy. However, the plan could provide much-needed strategic coherence for Hong Kong's future as a bridge between China and the global economy. Former Yale University professor Stephen Roach warned of "Chinese-style central planning" potentially "over-promise and under-deliver," while in 2024, he suggested Hong Kong had been "shackled by the deadweight of autocracy."

Yet, Hong Kong could benefit from a long-term planning framework that balances practical administration and a clear vision. Deng Xiaoping's 1992 Southern Tour acknowledged that capitalism and communism recognize the need for both practical administration and long-term planning. Yuen Yuen Ang, a scholar at Johns Hopkins University, describes China's planning process as "directed improvisation," with Beijing setting big-picture objectives and local governments improvising to meet local needs.

Hong Kong's old colonial government maintained a Central Policy Unit to answer to the governor on strategic planning, but after 1997, policymaking responsibility devolved to an efficient administration. Hong Kong's past 29 years have shown the consequences of not having a long-term vision. Now, the adoption of a five-year plan may rectify this.

Foremost among the plan's core elements is the development of the Northern Metropolis, estimated to cost at least HK$224 billion (US$28.5 billion), along with modernizing Hong Kong's aging housing stock. The plan also emphasizes new technologies in education, trade, and tourism, and addresses the urgent issue of elderly housing, with over 9,000 high-rises over 50 years old.

The government is considering private-sector-led revitalization proposals, recognizing that public funds may be strained by the Northern Metropolis's ambitious demands.