Clear The Air News Blog Rotating Header Image

June, 2011:

Hong Kong losing its lustre?

17 June 2011

SINGAPORE: More senior-level professionals in Hong Kong are eyeing Singapore as their preferred work destination, according to global recruitment agency Ambition.

During the first five months of the year, it came across about 320 candidates “expressing interest in relocating to Singapore from Hong Kong” – a 58-per-cent increase from about 200 candidates in the same period last year.

Most of these candidates have, on average, about five to six years of work experience and are at director level.

Adding that these candidates “aren’t just seeking a better job”, Ambition Singapore managing director Paul Endacott said: “The people we are talking to are citing a growing range of negative issues in Hong Kong, including the lack of places in international schools.”

He added: “Pollution is constantly on their growing list of concerns but they also have issues with the cost of living – specifically associated with accommodation – the size of the accommodation they can typically afford and quality of life, particularly for families.”

CIMB-GK regional economist Song Seng Wun noted that senior professionals with families would prefer Singapore as it is “more family-friendly”.

Said Mr Song: “But the opportunities for banking and finance in Hong Kong are much bigger … young professionals starting out may not mind a lower quality of living in order to reap these opportunities.”

In the first three months of this year, Singapore’s gross domestic product overtook Hong Kong’s – a trend that the Bank of America Merrill Lynch had said last month would continue for the rest of the year, helped by strong gains in the Singapore dollar against the greenback, to which the Hong Kong dollar is pegged.

Mr Song noted the region’s pull factor as well: Economies in South-east Asia are expanding rapidly, creating plenty of job openings in Singapore.

Concurring, DBS economist Irvin Seah said: “Singapore is smack in the middle of South-east Asia … This has led to an increase in jobs here, which is a very attractive proposition coupled with the stable geopolitical environment and social stability here.”

However, Mr Seah noted that the tightening of Singapore’s immigration policy “could pose a challenge for international talent looking to relocate to Singapore”.

While Mr Song felt that Hong Kong’s proximity to China meant that it will remain an attractive economy, Mr Seah said this was a double-edged sword.

Said Mr Seah: “There are several up-and-coming Chinese cities which are very competitive and pose a challenge to Hong Kong as a gateway to the China market.” – TODAY


Download PDF : CTACountryComparAQO

Handy Comparison Charts Note absence of lethal PM2.5 standard

Emissions Reference site Th esignificance of Euro5 is Particulate Matter stringent rules PM2.5 is the roadside killer

Summary of worldwide diesel emission standards is presented in cooperation withDiesel Progress Magazine.

  • Euro I standards were introduced in 1992, followed by the introduction of Euro II regulations in 1996. These standards applied to both truck engines and urban buses, the urban bus standards, however, were voluntary.
  • In 1999, the EU adopted Directive 1999/96/EC, which introduced Euro III standards (2000), as well as Euro IV/V standards (2005/2008). This rule also set voluntary, stricter emission limits for extra low emission vehicles, known as “enhanced environmentally friendly vehicles” or EEVs.
  • In 2001, the European Commission adopted Directive 2001/27/EC which prohibits the use of emission “defeat devices” and “irrational” emission control strategies, which would be reducing the efficiency of emission control systems when vehicles operate under normal driving conditions to levels below those determined during the emission testing procedure.
  • Directive 2005/55/EC adopted by the EU Parliament in 2005 introduced durability and OBD requirements, as well as re-stated the emission limits for Euro IV and Euro V which were originally published in 1999/96/EC. In a “split-level” regulatory approach, the technical requirements pertaining to durability and OBD—including provisions for emission systems that use consumable reagents—have been described by the Commission inDirective 2005/78/EC.
  • Euro VI emission standards were introduced by Regulation 595/2009published on 18 July 2009 (with a Corrigenda of 31 July 2009). The new emission limits, comparable in stringency to the US 2010 standards,become effective from 2013 (new type approvals) and 2014 (all registrations). In the “split-level” approach, a number of technical details will be specified in the implementing regulation (‘comitology’) which should be adopted by the end of 2010.

New body proposed to oversee charities

RTHK 16-06-2011
The Law Reform Commission has proposed the creation of a new body to take charge of the registration and regulation of charities. Under the proposal, a new Charities Commission would have the power to look into cases of mismanagement and to remove certain trustees and senior officials.

But political parties would not be subject to the new regulation. The chairman of the commission’s Charities Sub-committee, Bernard Chan, said internet fund raising would also be excluded from the new law.

Authority defends impact study decision on runway

Hong Kong Standard – 15 June 2011

The Airport Authority has defended its decision not to commission an environmental impact study on the third runway before seeking the views of the public.

Authority chief executive Stanley Hui Hon-chung said yesterday a detailed assessment will only be carried out once the public has agreed to give the controversial project the go-ahead.

The government-owned authority has put forward two options for the public to consider.

One is to build a third, parallel 3,800-meter runway north of the existing two at an estimated cost of HK$136.2 billion, with inflation factored in.

It will be Hong Kong’s costliest single infrastructure project and requires reclamation of 650 hectares, the second- largest in local history.

The other is an expansion of the two- runway airport, costing up to HK$42.5 billion, including inflation.

In an interview with The Standard, Hui said: “We don’t know which option will win the hearts of Hong Kong people in the end.

“It may need more than HK$100 million to conduct an environmental impact assessment.

“If we did it now, some might question the rationality of only carrying out an impact study on [the third-runway option but not the other].”

He said environmental protection and economic development are not necessarily mutually exclusive.

The aviation industry currently accounts for more than 2 percent of global carbon dioxide.

Hui said the authority has presented to the public both “very comprehensive” and “credible” information provided by its consultants.

“If you find our information incorrect, you may seek views from your own experts,” he said.

On the possibility of enhancing collaboration with mainland and Macau airports, Hui was more guarded.

He said this matter has to be handled carefully so as to abide by the principle of one country, two systems.

After all, mainland cities and Macau may wonder why they should cooperate with Hong Kong International Airport just to benefit the territory.

In response to concerns over the HK$136.2 billion price tag, Hui said on the grounds of reclamation alone, costs should not be directly compared with those of new runways overseas.

They’ve all got to come down

South China Morning Post – 14 June 2011

Development secretary Carrie Lam meets the Heung Yee Kuk and says that extra storeys added illegally to village houses will have to be demolished

Extra storeys added illegally to village houses in the New Territories must come down, the government said yesterday.

After a meeting with powerful rural affairs body the Heung Yee Kuk, Carrie Lam Cheng Yuet-ngor, the secretary for development, said immediate enforecement action would be taken against serious breaches.

She announced the decision following negotiations with more than 30 kuk representatives.

The meeting came weeks after the Ombudsman criticised the government for enforcing the law more vigorously in urban areas than in rural ones.

“We will take immediate enforcement action on village houses with serious breaches, such as those with one, two or even three extra storeys … This means the extra storeys will have to be demolished,” the minister said. The kuk said that glasshouses covering more than half a rooftop would fall into this category.

“Our proposal is in no way an amnesty, or allowing cash payment in place of law enforcement,” she said — a direct response to previous suggestions by some kuk members.

Kuk chairman Lau Wong-fat, for the first time, agreed to a crackdown on extra storeys, which are commonplace across the New Territories. But he was quick to raise a condition: that only the 36,000 so-called small houses built after 1972 should be covered. “Village houses built on land under the Block Government Leases involve complicated legal and personal considerations and needs a further study,” Lau said.

He was referring to plots of land surveyed by the British government in 1905 after it occupied the New Territories. Officials mapped all the lots and reflected the land use at that time, such as for housing or for agriculture. The findings were attached to a Block Government Lease. House lots of such leases apply to 10 to 20 per cent of village houses, according to Raymond Chan Yuk-ming, a spokesman for the Institute of Surveyors.

Lau argued that the century-old lease of “house lots” had stipulated no height limits for buildings, and that neither the small-house law nor the urban building regulation should apply. However, the small-house policy, enacted in 1972 to compensate villagers who gave up their land to new-town development, has required all village houses to be limited to three storeys built on a plot no larger than 700 square feet in order to be exempt from urban building regulations, which require work and occupation permits.

“We don’t expect an across-the-board prosecution,” Lau said, “and we hope there will be a legal clarification.” But Lam said the government disagreed with the kuk. “Before the clarification, we stand firm that [all village houses] are subject to control.”

Barrister and Civic Party lawmaker Ronny Tong Ka-wah said he saw no grounds for a particular category of village houses to escape control, noting that the small-house law had been tailor-made to respect villagers’ lifestyles.

The government said less serious violations would be set aside for a later date because there were so many of them. Lam did not give details, but the kuk expected that glasshouses occupying less than half the rooftop area should fall into this category. It said enforcement should be deferred for 10 years and come with a registration system. Both sides agreed that environmentally friendly additions and amenities, such as a solar-powered water heater, a rooftop security gate and a small canopy over the main door, would be allowed in existing and future houses.

Top government officials – including Chief Executive Donald Tsang Yam-kuen – have been accused of having illegal extensions at their properties.

Watchdog proposed to check charities

South China Morning Post – 13 June 2011

The Law Reform Commission suggests a new group be created to oversee NGOs amid concerns the lack of a governing body could lead to abuse of donations

The Law Reform Commission this week will recommend a law to establish a Charities Commission to take charge of the registration and regulation of charitable organisations in Hong Kong.

This comes in response to widespread concerns about the lack of oversight of charities and the ease with which they can be set up and acquire tax-free status.

A person close to the Law Reform Commission subcommittee on charities said the proposal would be based on a similar body in Britain.

Under the proposed law all charities would have to register with the commission, open their accounts and be transparent in their activities and operations.

Registered groups would be given a licence number and be allowed to use the term “charity” in their operations, while the commission would monitor their work and make sure their operation fitted their mission.

“For example, a charity serving local communities should not invest in overseas properties,” the person said.

The commission would not, however, evaluate or regulate the effectiveness of their activities and campaigns, or issues such as their administration costs. “There are 7,000 NGOs in Hong Kong and to monitor them closely would be a huge task,” he said.

“The performance of a charitable organisation in promoting its cause should be decided by its donors and stakeholders,” he said.

“This new commission could become another Securities and Futures Commission if it had to work as a full regulator.” Britain’s Charities Act of 2006 defines a charity as a body or trust that performs one or more of 13 specified purposes that benefit the public. These include poverty relief and the advancement of education, health or religion.

The commission regulates the charities and has the power to check whether organisations are “fit and proper” to carry out public fund-raising, which must be licensed.

The proposed law for Hong Kong would adopt most of these rules, the person said. Groups calling themselves charities can apply to the Inland Revenue Department for tax exemption on charitable grounds. Last year the 6,380 registered groups raised HK$5.01 billion.

No single law governs charitable organisations and the use of the donations. There is also no law to regulate online fund-raising. The Social Welfare Department regulates flag selling, the Television and Entertainment Licensing Authority regulates raffles, and the Food and Environmental Hygiene Department regulates other sales.

Tik Chi-yuen, a seasoned social worker and former executive director of the Society for the Aged, said the current arrangement opened the charitable institution status to abuse. Although the commission should not intervene in charities’ operations, it should compile a code of practice, such as for the composition of the board of directors, for them to follow.

“There should be some sort of standard on governance, so the public will know how well the charities are operating. It will make public monitoring more effective,” Tik said.

Peter Cheung Kwok-che, the social workers’ representative in the Legislative Council, welcomed the commission’s decision to leave monitoring of the charities to the public.

“The most important thing is transparency. As long as the charities show the public how they spend their money, we don’t need government regulation,” Cheung said.

In 2007, the chief justice and secretary for justice asked the Law Reform Commission to study whether a law governing charities was needed.

The Independent Commission Against Corruption, in 2009, announced guidelines for charities on how to plug fund-raising loopholes that could lead to corruption. These focus on how charities manage their accounts and encourage them to keep donors informed.

Poll in SCMP Magazine today

South China Morning Post — 12 June 2011

Do you think the HK Government will ever solve the city’s worsening air pollution problem?


Hong Kong Airport 3rd Runway debate

Airport upgrade warrants more options

By Song Sio-Chong (HK Edition)

Updated: 2011-06-11 07:43

On June 2 the Airport Authority (AA) released its “Hong Kong International Airport Master Plan 2030”. One option outlined is a plan to upgrade the two existing runways at a cost of HK$23.4 billion with HK$432 billion of economic benefits. The other option is to build a third runway with an investment of HK$86.2 billion, accruing HK$912 billion of economic benefits over 50 years.

Which one do you choose? As the first upgrading option will still see saturation of airport capacity by 2017, then the obvious answer is the second option judging by its face value. I will certainly vote for option two if there is no third option on the table. But are there in fact any more viable alternatives?

I believe other related factors should be considered before making any decision. The first is about the site area and location of the airport. With two existing runways, the total site area of the airport is about 1,255 hectares. With an additional third runway, the total site area would then be 1,905 hectares. That is to say about 650 hectares of land will have to be reclaimed from the sea for the second option to work. As the reclamation will be carried out at a rather deeper seabed compared with the existing runway, the land reclamation alone will cost HK$38.9 billion plus an additional HK$9 billion to prevent the release of toxic mud.

This cost will be sufficient to build a new airport in the New Territories with one runway (option three). Then the new second airport could cater for another runway and meet needs beyond the 2030s or 2040s. But in the current option two, when all three runways are at full capacity by the 2030s, it will be impossible to build the fourth runway. So what will our options be if other potential locations have already been occupied?

The second factor concerns economic benefit. At first glimpse, one may believe the economic benefits from option two (HK$912 billion) is much better than option one (HK$432 billion), but if the investment between option two (HK$86.2 billion) and option one (HK$23.4 billion) are compared, it appears that option one will produce better benefits in terms of returns in the future, provided that there is another airport development before option one is saturated in 2017. If this is the case, then the combination of option one and option three appears to be better than option two alone.

Both option one and option two have the same capacity of 34 flights per runway per hour, thus the total capacity of option one ( with two runways) will be 68, and option two (with three runways) 102 per hour respectively. My third related issue is with how we can increase this capacity. Technically speaking, the capacity of any runway depends on aircraft types, its taxiway system, air traffic control techniques, and apron capacity, landing aids etc. If all conditions are satisfactory, the world maximum figure could rise to 50 flights per hour under the Visual Flight Rule. I wonder whether the Hong Kong record could be improved from 34 to 40 or 45 flights per hour without sacrificing safety as the first priority. If the capacity for the existing runways to handle flight movement could be substantially expanded, then the time before saturation would be extended.

The fourth factor regards the air traffic forecast. Flight movements at Chek Lap Kok International Airport have risen on average by 6.5 percent per year, and the two existing runways will become saturated by 2017. Although the growth figures may be accurate in retrospect, it may not necessarily have the same accuracy in forecasting the future. The reasons are twofold: one is the competition from adjacent airports, particularly Shenzhen Baoan Airport and Guangzhou Baiyun Airport. As they can build their airports with similar flight capacity at a cost of about 10 percent of that of Hong Kong, they collect much less airport charges than Hong Kong. Notwithstanding that the Hong Kong AA is operating under prudent commercial principles, Hong Kong AA may not compete with its adjacent counterparts respecting airport charges as Hong Kong has a much more expansive airport.

The other reason is the development of the super railway and highway networks on the mainland. In light of China developing the fastest super railway system in the world, a short-haul flight of up to 800 kilometers cannot compete in terms of cost and time, unless Hong Kong can have much shorter check-in time, cheaper tickets and more frequent flights. Medium-haul flights of about 2,000 km may also find it difficult to compete with the super railway network. With a more convenient highway network, Hong Kong residents who live in Kowloon and New Territories (East and North) may also prefer to use Shenzhen Baoan Airport rather than Hong Kong Chek Lap Kok Airport in the future.

Based on this twofold analysis, I believe the forecast of 6.5 percent growth is too optimistic as short distance flights will be reduced, and medium-haul flights may have not grown as expected. If I remember correctly, the government had briefed the Legislative Council on its plan to proceed with the privatization exercise of the airport in February 2004, and the Economic Development and Labour Bureau published a consultation document on Partial Privatization of the AA in November 2004 that showed an unsatisfactory equity return of less than 2 percent in a worst-case scenario. It would be really interesting to note what made the AA take a U-turn on the subject of airport development.

I do not mean to discourage Hong Kong airport development. On the contrary, I strongly believe Hong Kong should have a wise strategy for airport development in order to maintain its status as a center of international and regional aviation as required by Article 128 of the Basic Law. More options and deeper study are needed.

The author is a current affairs commentator.

(HK Edition 06/11/2011 page3)

” Sung believes too that what officials fear most is an environmental impact assessment unfavorable to the project.

The airport opened in July 1998. Seventy billion dollars of public and private money went for terminals, runways, taxiways, bays and ancillary facilities.

Another HK$34 billion went into the airport railway, and billions more on bridges, tunnels and expressways to make the Lantau site  accessible.

The all- in cost was HK$155 billion.”

” The diversification of firms such as Foxconn and the consequent drop in air cargo have taken place therefore mainly at the Hong Kong International Airport, and it probably explains the monthly declines in cargo turnover in April and May this year. If this truly is the case and the decline is structural instead of seasonal, one should expect further declines in air cargo shipments in the coming months and perhaps even years.  It may become a long-term declining trend if the metropolitanization process in the PRD region turns it into a service economy instead, thereby forcing most of the manufacturing activities to shift to places further away from the core areas of Guangzhou and Hong Kong. Thus Hong Kong’s airport will lose the local industry’s demand for air cargo freight from the region forever.

Hong Kong has to find new sources of demand to sustain its current operations and the new runway beyond the next 12 years. Even so, the competition will be very acute because of the large increase in capacity in the regional cluster of airports. Thus late expansion of the airport in Hong Kong is running counter to any conventional wisdom.

The author is head of China Business Centre, Hong Kong Polytechnic University. ” Hong Kong  China Daily

More studies demanded on third runway impact By Joseph Li (HK Edition) Updated: 2011-06-18 06:45

“Besides, the report does not take into account carbon emissions by vehicles passing by the airport’s vicinity, including Tung Chung and North Lantau, Choi said.

Samuel Hung, chairman of the Hong Kong Dolphin Conservation Society, said the authority has attempted to dismiss the impacts on the Chinese White Dolphins by modifying the document on dolphin movements that he had prepared for the Agriculture, Fisheries and Conservation Department.  The authority management finally apologized to the green groups. The environment groups responded that the authority should apologize to the public for having misled the people of Hong Kong.  ”

Emissions from aircraft will grow   Letters Page

The 2 per cent aviation emissions figure Cathay Pacific  Mark Watson cites (“Aviation industry is committed to addressing climate change impact”, June 20) in response to my letter (“Emissions accelerating, not declining”, June 13) differ from the 3-3.5 per cent cited by the International Civil Aviation Organisation (ICAO) website.

The ICAO’s projected aircraft emissions growth of 3-4 per cent per year contrasts with Mr Watson’s planned halving of emissions by 2050. In 38 years, a 3.5 per cent exponential growth will quadruple, not halve, current emissions: 628 million tonnes of carbon dioxide (CO2) annually will become 2,512 million tonnes. Because aircraft engines release CO2, nitrogen oxides (NOx) and particulates into the stratosphere, their impact is amplified. Current contrail-generated cirrus clouds insulate the atmosphere adding an independent warming effect greater than all previous aircraft CO2/NOX emissions since we began flying. Also, the 70 per cent of improvement in aircraft fuel efficiency has already been achieved. To “radically reduce” that remaining 30 per cent of emissions is technically increasingly difficult.

Any future efficiency improvements are offset by the doubling of flights projected by the Airport Authority……………… I quote: “HK’s GDP forecast at compound annual growth rate (CAGR) of 3.4 per cent” (GDP doubles in 20 years); “Mainland’s CAGR at 7 per cent” (an unrealistic quadruple GDP increase over 38 years); “Air traffic demand doubling by 2030”, coincidentally, a 3.5 per cent annualised growth in demand. Where is this growth to come from? Cheap extractable oil, without which these growth projections are unfeasible, is almost exhausted.   If the authority’s growth projections are correct, aircraft emissions will rise exponentially, making climate change a major problem – or Peak Oil will terminate the 20th century infinite-economic-growth/business-as-usual model, making flying prohibitively expensive, thereby killing demand. Thus, a third runway either adds to climate change or is redundant.

Richard Fielding, Pok Fu Lam