In the decades to come, Hong Kong’s physical and economic landscape will undergo a transformation. The Northern Metropolis will provide a new commercial centre for the city with technology parks, infrastructure and thousands of new jobs and homes. It will strengthen our links with the Greater Bay Area (GBA) and provide a physical and sectoral counterbalance to our current finance-driven CBD around Victoria Harbour.
Chief Executive Carrie Lam announced the Northern Metropolis Development Strategy in her Policy Address on 6 October. In her speech, she said: “the Northern Metropolis will be the most important area in Hong Kong that facilitates our development integration with Shenzhen and connection with the GBA.”
Under this ambitious plan, around 30,000 hectares – more than a quarter of Hong Kong’s total land mass – will be redeveloped to create this new urban area.
Augustine Wong, Executive Director of Henderson Land Development, explained that some of this land had already been identified for potential development by the Government.
“The Northern Metropolis area, from the planning point of view, is bringing these plans together in one metropolis, instead of three or four new towns.”
One aim of the plan is to help ease the city’s housing shortage. When the development is completed, it will be home to around 2.5 million people, up from 1 million today. There will likely be a mix of affordable housing and homes for the middle class, including the science and technology professionals who will be working there.
But the Northern Metropolis is not just about housing, and also includes plans for major commercial development. “It is about enterprises and technology, especially the innovative and creative industries,” Wong said. “I think what the Government wants to achieve with the Northern Metropolis is a self-sustaining new town.”
He explained how the new Northern Metropolis plan is quite different to the new towns that were built in Hong Kong, particularly from the 1960s to the 1980s. The first generation, such as the development of Tsuen Wan, was based on the need for more land for manufacturing. This was followed by more public housing, then a third generation of dormitory-style new towns.
However, one downside of these new towns is that many Hong Kong residents now travel from the New Territories towards Central to get to work, creating crowded trains and roads heading south every morning and spare capacity in the other direction. The Northern Metropolis will help address this issue by providing around 650,000 jobs in total. This will even out the imbalance in traffic flow while also making use of the transport infrastructure that is already in place.
Change in outlook
While creating new rail and road links, building more homes and offering new jobs are important proposals, the Northern Metropolis plan also points to much deeper connections with the Mainland GBA cities.
“I think this is a very important proposal that could reshape the path of Hong Kong’s economic development,” said Dong Tao, Vice Chairman, Greater China, Private Banking Asia Pacific at Credit Suisse.
“The significance is not about increasing housing units, it’s not about creating a new CBD, and it’s not about finding a few new pillar industries for Hong Kong.”
As Tao sees it, the Northern Metropolis reflects a sea change in the city’s economic thinking. Since Hong Kong returned to China 24 years ago, there has been relatively little integration with the Mainland.
“If you stand on the banks of Shenzhen river, you would be stunned by the contrast of modern buildings and active commerce on the northern side of the Shenzhen river, while on the south bank, you see green unmanaged land and container storage,” he said.
The newly announced strategy – in particular the size and scope of the Northern Metropolis – shows that Hong Kong is now actively seeking engagement with Shenzhen and the Greater Bay Area.
Another main reason why the Northern Metropolis plan is so groundbreaking is that it signifies a major shift in the city’s economic balance.
“The old Hong Kong development model is running out of steam,” Tao said. “In the 1980s, Hong Kong had four pillar industries – now it has only one left.”
And while the finance sector remains strong, it relies on projects and clients in the Mainland, he added.
Rents in Hong Kong – particularly in our traditional CBD – are too high for many industries, including some of the rising technology industries that will be key to the city’s continued prosperity.
“Hong Kong needs to find a new way to be competitive, to create wealth and benefit the general public,” Tao said.
Wong from Henderson Land agreed that the Northern Metropolis proposal was a logical development, given the huge opportunities across the border and the rapid growth of the GBA.
“Hong Kong and Shenzhen should not be considered as two different or totally separated entities,” he said. “Given the macroeconomic situation and the latest political situation, it makes sense to have a plan for Hong Kong that coordinates with our neighbour.”
Besides a number of current and proposed new towns, land under the Northern Metropolis also takes in wetlands and fishing ponds, mountains and coastal areas. Wong anticipates that the Government will take a more active role in managing the wetland areas to better protect the birds and other wildlife there, therefore enabling a small proportion of the fishing ponds to be reclaimed without damaging the environment overall.
“The proposed policy is a compromise by the Government,” he said. “On the one hand, some of the fishing ponds will be used for development, but on the other hand, more money will be provided to actively protect and enhance the remaining ponds.”
Indeed, environmental protection and developing eco-tourism are key parts of the plan, which aims to enhance conservation efforts while enabling more people to access areas including the Hong Kong Geopark and the Mirs Bay in the east.
Long-term plan for prosperity
Douglas Woo, Chairman and Managing Director of Wheelock and Company, said: “Land supply is a ‘Team Hong Kong’ issue.”
He welcomed the proposed Northern Metropolis as a plan that will not only help solve our housing issues, but also provide an opportunity for Hong Kong businesses and the community to work together to deliver the project.
“A new, 30,000-plus hectare land supply initiative, along with short- and medium-term housing initiatives, have been added to the table,” Woo said. “This seems to be an opportunity to think big and think positive. With a constructive mindset, there is very little we can’t do.”
The Northern Metropolis is clearly a long-term project. It is likely that it will take place in several phases, and the plans may evolve over time in response to the changing local and global environment. Wong from Henderson Land suggested it could be compared to Shanghai’s Pudong New Area, which has been built gradually since the 1990s, with the plans changing as the Chinese economy grew rapidly during this period.
There is no doubt that building more and closer links with the GBA will be of tremendous benefit to companies in Hong Kong. A substantial new business hub to allow more innovative companies to flourish, that is geographically close to the dynamic tech hub of Shenzhen, will be crucial if Hong Kong is to continue to prosper.
“There is no guarantee the Northern Metropolis will succeed,” Tao from Credit Suisse said. “But there is a guarantee that if it does not happen, Hong Kong will continue to struggle – economically, politically and socially.”
Facts and Figures
The Northern Metropolis includes the mature new towns in Tin Shui Wai, Yuen Long, Fanling and Sheung Shui, as well as six new development areas: Kwu Tung North and Fanling North, Hung Shui Kiu and Ha Tsuen, Yuen Long South, San Tin and Lok Ma Chau, Man Kam To and the New Territories North new town.
Plans to encourage innovative industries include the “San Tin Technopole” which includes the Hong Kong-Shenzhen Innovation and Technology Park and the areas around Lok Ma Chau. This aims to be a rival to Silicon Valley, and is more than 16 times bigger than the Hong Kong Science Park.
In terms of housing, the strategy will provide at least 165,000 residential units – equivalent to around 13 to 14 Taikoo Shings –providing homes for 2.5 million people in total.
The plan includes considerable investment in transport infrastructure, with new road and rail crossings, including a rail link between Hung Shui Kiu and Qianhai in Shenzhen’s Nanshan district, and extending the planned Northern Link northwards to connect to the new Huanggang Port.
The Northern Metropolis will support 650,000 jobs, including 150,000 in the I&T sector, up from around 116,000 jobs at present.