Hong Kong is grappling with a stark demographic transformation, posing serious trouble to its status as “Asia’s World City”. Once a beacon of international businesses, foreign corporations, tourists and expatriates alike, the city has lost its appeal.
Hong Kong suffered the largest-ever annual population drop as the exodus reached 291,000 residents until mid-August 2023. The salience of exits came about with the stringent Covid measures. However, even before Covid, many Hong Kong residents decided to leave because of China’s stronger grip over the territory.
When Beijing imposed a controversial national security law over the territory, which seemed overarching in its definition of crimes and scope, international companies also started to reconsider their operations in Hong Kong.
Meanwhile, Hong Kong is not only struggling with the mass exodus of professionals but faces alarmingly low birth rates. The latter plunged to 0.8, one of the weakest in the developed world.
For these reasons, Hong Kong has been putting measures and incentives into force for some time, such as investment migrant schemes, new tax concessions for investors, and visas to attract top talents.
Recently, Hong Kong authorities also announced a new initiative to hand out K$ 20,000 ($2,556) to the parents of each baby born until 2026 to address the city’s “persistently low birth rate”.
However, such an incentive did not have the demographic improvement that was hoped. The public considered the sum of HK$20,000 ridiculously low to woo people outside of the working class. Even if some would consider this financial carrot “better than nothing”, this sum is far from expectations.
The rise in female workforce engagement is another fact. Women find it hard to reconcile economic and domestic roles. They have to work hard outside and still bear the brunt of household chores and care of children. Extended working hours have also been identified as a factor hampering fertility rates.
However, the most pressing concern points to the ever-high living costs. The costs of childcare, housing, and education have become so high that they are off-limits for most households.
While current measures are inadequate and fall short of expectations, other countries have adopted different strategies to encourage childbirth.
South Korea and Singapore have adopted much more generous financial stimuli to boost natality. However, these measures were successful in rekindling women’s motivation. Authorities discovered that redressing birth rates needed more holistic approaches including in terms of lifestyle.
Hence, Hong Kong authorities are not only late in the game, but their piecemeal approach has taken away any momentum or responsiveness from the public. Predictably, they hardly changed the public perceptions towards birth.
Urgent transformations are imperative at this juncture, and these should not solely rely on financial changes. Encouraging women to marry and do so at a younger age could have a substantial influence on boosting the fertility level, as it is easier to promote fertility among married couples. Nevertheless, the relative volume of efforts to fertility would be high, and the fertility rate could only increase in the long run if there is a significant shift in reproductive behaviours and marriage habits.
The current urgency calls for a bottom-up revolution in how the people of Hong Kong perceive the interplay between family and work. Traditional Confucian teachings still wield influence over the domestic division of labour and the dynamics of men and women in marriage and child-rearing, which perpetuates the gender equity gap where males hold dominance within the family. Government should be proactive in improving the environment to narrow the gender equity gap in institutional and family settings.
It is suggested that the “use-it-or-lose-it principle” that has been adopted in Norway by mandating a 2-week paternity leave can promote the participation of fathers at the early stage of childcare. Under this scheme, if the father of a newborn does not take paternity leave, he loses the reserved day-off quota.
Institutional support should encompass not only parental leave but also the implementation of flexible working arrangements. While access to excellent childcare services and domestic helpers may help, they cannot be a substitute for parents dedicating quality time to their children. The reality is that nurturing human capital comes at a cost. There is a significant correlation between better-faring children and energy and the ability of parents to invest in them, and many prioritise educational or career success due to the prevailing achievement-oriented culture. This, in turn, necessitates promoting healthy cultural attitudes and social cohesion, which can’t be addressed through pronatalist policies alone but also require deep shifts in the collective mindset.
Given the grim picture, a pertinent question arises: why has the low fertility issue come under the government’s radar only recently? This issue has been observed over many decades now. Why was there little to no official action? It took a significant population outflow to spur the Hong Kong government into action. Does this mean that Hong Kong wants to retain its status as a financial and business hub in Asia?
Meanwhile, China’s crackdown on Hong Kong makes things more problematic. In the past, Hong Kong circumvented the ageing population problem by tapping into immigration, taking advantage of its special status. However, given the loss of attractiveness due to Chinese interference, even the short-term immigration panacea could not cure the long-term ills.
Unless the Hong Kong authorities make dramatic socio-structural and institutional changes that truly make a difference and affect perceptions, “Asia’s World City” will only become a shadow of its former self.
