HK named World’s Freest Economy again!

Big Lychee, Various Sectors

Even by its own embarrassing standards, the Hong Kong government has rarely looked as lame and pitiful as in its attempts to justify the determined criminalization of ride-hailing apps, personified by Uber.

Perhaps Hong Kong’s officials were emboldened by Uber’s mounting reputational problems in the US, from poor treatment of its drivers to a recent sexual harassment scandal. The company’s loss of its cool and trendy innovation/tech appeal represented a perfect opportunity for our bureaucrats to give it a good kicking for willfully ‘breaking the law’ (and ‘undermining our core values’) by operating here.

But the Hong Kong public have not been so easily fooled. As not one but two South China Morning Post columns make clear, the government is simply trying to protect the speculative investments of some (well-connected) rent-seekers who hold the city’s limited number of taxi licences.

The fact that the threat to these vested interests comes from the officially hyped ‘innovation/tech Silicon Valley’ thing is a double embarrassment to the administration, which went to great lengths to establish a whole bureau to promote space-age cyber-info-blah-blah. It is a reminder of the essential principle that the Hong Kong government will favour cartels and cronies over competition and the interests of the overall population and economy. This is hardly news (see housing, supermarkets, construction supplies and dozens of other domestic markets). But in this case, the failure of governance is particularly stark.

Ride-hailing apps have become popular in Hong Kong because they meet a real social need by filling a gap in local transport options. Existing taxi services are fairly cheap but crummy and inflexible, and in practice won’t serve certain types of route.

Looking at the big picture, Hong Kong needs to embrace new approaches to how it uses scarce road space. In urban areas the streets are clogged up with illegally parked or crawling vehicles, at the expense of pedestrians and air quality. At a bare minimum the government should be pedestrianizing and pricing private cars out of the most crowded districts. Ride-hailing aps could help us use space more efficiently (essentially by better utilizing cars and reducing the need for parking space).

Looking further ahead, it will be technologically possible and practical, indeed necessary, in cities to replace single-owner cars and traditional taxis with shared self-driving electronic vehicles, operated by companies that may or may not include Uber. Under just-slightly-visionary leadership, densely developed and economically advanced Hong Kong could be pioneering this sort of change – and selling its know-how to Mainland cities, and probably to all sorts of politically correct Belt and Road markets as well.

Except it won’t because – as we approach the 20th anniversary of the handover, and the last few days of Chief Executive CY Leung – all that matters is protecting some parasites sitting on 1970s-style taxi licenses. Contrived mouth-frothing about Uber as a law-breaker just highlights the fact. And now please all rise and bow to the Chinese Communist Party for so wisely and considerately choosing such high-quality leadership for us.