What if Shenzhen merged with Hong Kong?

This is an old article but I find it a bit interesting.

http://www.hkdf.org/newsarticles.asp...newsarticle=49

What if Shenzhen merged with Hong Kong?


There has been debate on both sides of the border as to what will happen to Shenzhen, China's first experiment with capitalism, when this year China gets Hong Kong, the real thing. Could the two territories be merged?

Shenzhen is a territory of _ _ square miles is twice the size of Hong Kong, with over 4 million people, of whom less than one million are official residents. Although Shenzhen has mountainous, it has much more useable space than Hong Kong. Its people include some of China's best. Young, energetic and entrepreneurial workers flock to Shenzhen from all over China, attracted by the high salaries and relatively greater freedom of the country's most successful economic zone. Turnover on Shenzhen's stock market has recently surpassed that of Hong Kong's own exchange. Shenzhen has port and airport facilities, as well as agricultural land.

There is a high degree of "soft" integration between Shenzhen and Hong Kong. This does not extend to governmental links or more than basic physical infrastructure connections, but at the business unit level there is a high degree of integration with much Shenzhen manufacturing and property development, as well as many service businesses, controlled by Hong Kong principals.

Shenzhen has an outer border marking the boundary between the SEZ and the rest of Guangdong Province. While this border is not very effective, it could be improved. What would happen if the border between Hong Kong and Shenzhen were removed?

For Hong Kong there could be many advantages.

* Hong Kong would reintegrate with much of its former manufacturing base.

* Infrastructure on both sides of the Shenzhen river could be properly coordinated, and the current bottleneck at the Lok Ma Chau crossing eliminated.

* Hong Kong would gain access to new resources of land and labour, thus reducing upward pressure on property prices and wages and helping Hong Kong's competitiveness.

* The Hong Kong economy would become more balanced, with some agriculture, a better supply of water, and generally greater diversity of resources. There would be more scope for locating port and airport facilities. Accommodation needs could be better met without filling in Hong Kong's harbour.

* The greater experience of Shenzhen people and officials in dealing with the China environment would benefit Hong Kong as it becomes part of China.

There could also be very large intangible benefits if the shock of unification with Shenzhen prompted Hong Kong to reexamine some of its basic policies. In housing, welfare, education, allocation of monopoly franchises, Hong Kong is still operating under a policy framework that has hardly changed for decades. Many of these policies would have to be radically reviewed to accomodate 4 million more people. This might be highly beneficial.

The merger might give a boost to the democratisation process in Hong Kong. It is hard to see a quick way of extending Hong Kong's arcane constitutional system, with its bizarre functional constituencies, to Shenzhen. The only efficient way to accomodate millions of new poeple with diverse and as yet unknown views would be hrough democratic representation.

For Shenzhen, merger could also bring many benefits. Shenzhen has come to the end of its rationale as a SEZ. To progress further, it must develop the institutions of a civil society - a proper legal system, the rule of law through representative Government, secure property rights, professions, a culture of civic responsibility, reduction of corruption and crime. It would be a long road for Shenzhen to devlelop these things by itself, or as part of China's national process. So why not just buy into Hong Kong's system?

For both Hong Kong and Shenzhen there could be substantial advantages in merging. However, it would be in the interests of both for the merger to be on Hong Kong's terms. The merged territory should be a Greater Hong Kong, operating in accordance with Hong Kong's system, rather than a Greater Shenzhen. However, Hong Kong could learn a lot from the merger process, not least by being brought face to face with many of its antiquated policy assumptions.>