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Highest inequality in decades underpins Hong Kong protests

Pro-democracy protestors filled Hong Kong streets in 2014, demanding universal suffrage, but fueled by the city's growing inequality. The "occupation" has since ceased, but the social tension and discontent never abated. (Credit: Studio Incendo / Flickr)

Hong Kong will soon mark 20 years since Britain returned the former colony to China and Chinese state media is touting the milestone by promoting the city’s greater prosperity under its “one country, two systems” strategy.

But few Hong Kongers are feeling very prosperous or celebratory given that recent data has revealed the wealth gap is now the widest it’s been since the city began tracking income equality 46 years ago.

Ahead of Chinese President Xi Jinping’s visit on Thursday to celebrate the anniversary of the British handover on July 1, police are locking down the city and already arresting pro-democracy protestors.

“We want to tell Xi Jinping that Hong Kong’s prosperity is just a facade,” one student protest leader Joshua Wong shouted into a microphone, according to Reuters. In 2014, Wong helped lead the Hong Kong “Occupy” protests, which agitated for universal suffrage and, at its core, an end to the inequality fueled by the Chinese mainland’s elite.

Three years later, the wealth gap in this technically (supposedly) autonomous city-state is wider than ever. While the government places much of the blame on an aging population, many, including the pro-democracy protestors, point to the city’s unbearably high cost of living and property prices that benefit only a small minority.

Hong Kong boasts the third largest population of ultra-high net worth individuals worth at least $30 million in a city, after New York and London, according to a wealth report by the property consultancy Knight Frank. And those elite have done well under Chinese rule.

But mainland China has more than three times the number of ultra wealthy as Hong Kong, and the money they are pouring into the city has squeezed Hong Kong’s vulnerable – even average – residents out of an affordable life.

“One of the most urgent things for the new government to do is increase the public rental protection housing in Hong Kong so that poor people can have a decent living,” Kalina Tsang, head of Oxfam’s program in Hong Kong, told Reuters.

In a study on Hong Kong’s income distribution released earlier this month, the Census and Statistics Department reported that Hong Kong’s Gini coefficient – on scale of zero to one, where zero represents equality – was 0.539 for 2016. That’s places Hong Kong between New York, which is more unequal, and Washington, D.C., which is slightly less unequal, the report said.

Still, Hong Kong’s inequality index is one of the highest among developed economies, according to Oxfam. Using census data, Oxfam calculated that the richest 10 percent of the city’s households earn almost 44 times what the poorest 10 percent makes, which is on average about HK$2,560 ($328.20) a month.

The government noted that taxation and efforts to alleviate poverty through social benefits slowed the increase in inequality compared to previous years. However, Oxfam also noted that lack of labor protection is leaving many workers who are not permanent members of the workforce – more than 80 percent of those interviewed – vulnerable in such an unequal economic climate.

Amending labor laws to protect casual workers “would enable Hong Kong’s labor market to become a human economy that rewards those who work hard,” Tsang said in a press release, because as hard as people are working now, they keep finding themselves pushed to the fringes to make more room for the elite.


About Author

Joanne Lu

Joanne Lu is a South Carolina-based writer and editor dedicated to global development, poverty alleviation and social justice. After a year in Rwanda, she now covers the Asia-Pacific and economics. Find her on Twitter @joannelu or email