Generation 40s – 四十世代

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Hong Kong education reform continues, but Beijing’s role presents new challenges

South China Morning Post
CommentInsight & Opinion

Katherine Forestier

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From start-ups to big guns: can more Hong Kong entrepreneurs make it big in mainland China?

NewsHong KongEconomy
One stumbling block is the issue of identity. Many young Hongkongers cringe at any sort of ties to mainlanders, but for savvy entrepreneurs who have crossed the border, gunning for their pot of gold has included playing down their connection to the city

As the wealthy mainland investor was about to speak, aspiring Hong Kong entrepreneur Vincent Wong had the sinking feeling that his hopes of securing a cash injection for his start-up had been dashed.

This scene took place in Beijing two years ago when Wong, then aged 30, was anxiously trying to raise funds for his no-frills quick haircut business, Xingkeduo.

“We sat down and the first question he asked was, did I think Hong Kong entrepreneurs could succeed on the mainland? I just knew that the meeting was over,” Wong recalled with a laugh.

Meanwhile, things have looked up for Wong, who now boasts 90 salons across the country delivering more than 100,000 haircuts a month.

But Wong’s story highlights the obstacles facing Hongkongers who want to leave their comfort zone and step outside the nine-to-five work culture to be their own boss.

In 2009, only 7.3 per cent of about 2,000 adults surveyed in Hong Kong had ever considered starting their own business in the city, according to a large-scale study jointly conducted by three universities in Hong Kong, the Shenzhen Academy of Social Science and the Savantas Policy Research Institute, a think tank. By 2016 the figure had expanded to nearly one in five.

But only 3.6 per cent turned their intention into reality in 2009, with the figure rising correspondingly to 9.4 per cent in 2016.

The study also compared the trends for 2016 in other places: the percentage of respondents who had started their business was 16 per cent in Shenzhen, 10.3 per cent in the mainland as a whole, 12.6 per cent in the United States, 8.8 per cent in Britain, 8.2 per cent in Taiwan and 6.7 per cent in South Korea.

What the survey did not measure was the number of Hongkongers who crossed the border to follow their dreams. The size of this group is unknown but officials have previously estimated that about 300,000 – or 8 per cent of the city’s working population – work on the mainland.

The challenges of crossing the border

Recent news that Hongkongers on the mainland will get to access more perks – such as studying in public schools, receiving an employment report certificate to facilitate their job hunt after graduating from a mainland university, and the opportunity to contribute to a fund to help them own property – might encourage more people to move across the border.

But two issues then come into play.

First, the angst-fraught question of identity. Hong Kong has been back in China’s fold for almost 21 years but many young Hongkongers remain uncomfortable with any sort of connection to mainlanders.

A recent survey by the University of Hong Kong asked 1,034 respondents to choose their identity from the following options: “Hongkonger”, “Hongkonger in China”, “Chinese” and “Chinese in Hong Kong”. Only 0.3 per cent in the 18-29 age group picked “Chinese”, compared with 69.7 per cent for “Hongkonger”.

Under the “one country, two systems” principle in place since 1997, Beijing allows Hong Kong a high degree of autonomy and free speech, although recent incidents – such as the mysterious disappearance of booksellers who later turned up on the mainland – have raised questions about Beijing’s commitment to those rights.

Efforts to better integrate Hong Kong with the rest of China – such as the Greater Bay Area initiative that aims to unite Hong Kong, Macau and nine Pearl River Delta cities into an integrated economic powerhouse – are only just starting to gain traction, and what effect that will have on cultural identity remains to be seen.

Second, the difference in business culture. A lack of transparency in the mainland government’s policymaking process means that business activities considered legal one day can suddenly find themselves on the wrong side of the law the next day.

Given the importance of  guanxi – or personal connections – to the smooth conduct of business, Hongkongers with paltry ties may struggle.

Many Hong Kong entrepreneurs also have had to deal with a common perception among mainlanders that Hongkongers do not understand guoqing, or how things work in China.

To blend in, be humble

Despite Wong’s painful rejection two years ago, he went on to raise about 200 million yuan (US$31 million) for Xingkeduo and is considering taking it public.

Wong has learned to navigate the mainland business environment with a touch of calculated humility.

“When I introduce myself now, I say that I’m from a small Chinese suburb called Hong Kong,” he said.

“It’s challenging to build a big business in China if you can’t blend in with the people and understand them. You may build a business, but it won’t be a big one.

“It’s not unlike, say, trying to do business in the United States with a limited grasp of English. Investors won’t discriminate against you but you might run into some challenges making friends with these people, getting business connections,” he added.

Wong grew up in Hong Kong but attended university in the US. After graduating in 2007, he joined HSBC Banking Group in its Shanghai and Mexico offices.

“When I went to Shanghai in 2008, almost nobody wanted to go there. People were asking, why should they go to the mainland? But after I started working there, I realised that every city has its own type of energy.”

In 2012, he left his job and started a software company, renting a small flat and looking for customers via Taobao, the online shopping platform owned by Alibaba Group Holding, which also owns the South China Morning Post.

In 2015, he merged his software company with Xingkeduo and became its chief operating officer. He revamped the brand, raised the price of a haircut from 15 to 58 yuan and improved its appointment service, allowing customers to make bookings through WeChat, a mainland messaging app.

Hong Kong entrepreneur Terence Lin Chiu-fai has also become savvy in dealing with mainlanders.

Lin, who co-founded MICHE to sell used cars online and through its 105 outlets, tells investors he is from his family’s home province of Fujian instead of mentioning Hong Kong.

“Mainland investors sometimes feel that Hong Kong people don’t understand the mainland market.

“[But] a lot of Hongkongers also turn up on the mainland with an attitude that they are superior to local people,” Lin said.

He started MICHE in Xiamen three years ago as he saw the potential for the used car business, after Beijing began restricting new car ownership due to traffic congestion and air pollution.

Lin now has a staff of 1,000 and also heads a think tank set up by Hongkongers and Macanese who graduated from mainland universities.

To secure benefits, embrace the risks

Met Li Hing-lung is a young Hongkonger with dreams of building robots to replace delivery workers in China.

The mainland is an ideal place to pursue his idea, given that nearly 21 billion deliveries – for food and other goods – are made each year, according to his own research.

In 2016, Li co-founded ZhenRobotics, which produces metre-high six-wheel robotic AI delivery vehicles.

“Sometimes you see packages lying around delivery vehicles on the streets. That’s not the future. The future of delivery lies in artificial intelligence,” he told the Post from his office in Zhongguancun, Beijing’s Silicon Valley. Each robot is equipped with sensors and CCTV cameras and costs about 100,000 yuan to build.

Since last October, his robots have been making about 2,000 deliveries a day across 20 universities to solve the “last-mile” conundrum.

It works this way: delivery workers send online orders made by students to storage facilities on campus as they are not allowed to enter the dormitories due to safety concerns. Instead of students walking to the store room and back to pick up their parcels, they can now use ZhenRobotics’ WeChat account and request that their items be delivered for a fee of 2 yuan.

But recently, Li was caught off guard when some universities told him he could no longer charge his robots’ batteries on campus. This happened after a few incidents of electric scooters catching fire due to problems with their batteries, Li said.

“In the past, we could charge our robots as many times as we wanted. Now we have to charge the batteries once a day off campus,” he added.

Similarly, Sampson Ho, co-founder of China’s leading co-working space company WEPLUS, had to go back to the drawing board when mainland authorities recently banned the practice of multiple companies registering themselves under one business address.

This affects small start-ups who do not want to invest in an office but prefer using a co-working space to minimise costs.

“We’re still figuring out how to deal with that,” the Hong Kong entrepreneur said. “Some people are saying that because of the new policy, they won’t be using our spaces.”

The Federation of Hong Kong Industries recently said that the city’s business sector wanted mainland authorities to seek their views first before implementing policies that could affect them.

Despite this, for Hongkongers with dreams of building business empires, the mainland is still the place to be.

Aware that competitors are entering the market, Li is gunning for his robots to hit the streets in five years and to be the biggest supplier of delivery robots.

His company has received 300,000 yuan in subsidies from the mainland government, which is encouraging innovation and technology.

“The scale of fundraising in the mainland is so much different from that in Hong Kong.” Li said

“In Beijing, it is not us reaching out to the investors, but the investors who come to us.

“How many investors could you possibly find in Hong Kong? You can count them all on the fingers of both hands.”

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Switch off the smartphones, to save children from tech addiction

CommentInsight & Opinion

Robert Badal says social media and smartphone technology are inherently addictive, and e-learning might do more harm than good. Parents and teachers need to lead by example in the fight against device overuse


January 2: the World Health Organisation listed “gaming disorder” as a mental health condition under its International Classification of Diseases.

January 6: the California State Teacher’s Retirement System wrote to Apple demanding restrictions to children’s smartphone access and support for research, citing a range of serious mental health issues connected to smartphone use supported by clinical studies.

Soon after, former Apple executive Tony Fadell, “the father of the iPod”, slammed internet and social media companies for creating widespread addiction that Steve Jobs would have opposed.

Massachusetts Institute of Technology professor Dr Sherry Turkle called this rising storm “a bottom-up backlash”. She wrote a prophetic book in 2011 Alone Together: Why We Expect More from Technology and Less from Each Other, warning of the psychological and societal damage that is omnipresent now.

It is the nature of the beast. One of my students, Hoi Yan Shek, a Columbia University economics major, nailed it: “The key performance indicator of tech firms is the amount of time users spend and their engagement. This directly affects a company’s stock price. Tech firms must be dedicated to getting users addicted.”

And we have all been fatalistically complaisant. I was a California public school teacher when president George W. Bush’s No Child Left Behind Act mandated classroom technology utilisation. Companies churned out e-learning gizmos that we had to deploy in our lessons. Later, as a university professor in Japan, great fanfare accompanied the new computer room’s unveiling: row after row of boxy, now obsolete, desktops. Core skills – reading comprehension or writing – were never the rationale. The pitch was some variation of the need to “expose students to technology”.

Students use iPads during a lesson at the United Christian College (Kowloon East), in Hong Kong. Photo: Thomas YauPart of this was to address poorer students’ unequal access to technology. But this argument is outdated. Now anyone can step into a shop and walk out holding a more powerful device than that entire roomful of desktops.

Ironically, the impetus propelling educational technology today is the opposite of altruism. E-learning is designed either to sell gizmos or replace paid teachers because it can be mass duplicated: cheap economies-of-scale “education”.

A newer argument for technology in schools is that students love smartphones, so they belong in the classroom – again, with no objective studies about consequences.

How many other “tech advances” with questionable effects have we unquestioningly swallowed?

The cause of tech addiction is its intrinsic addictiveness and the unhesitating belief in technology’s benefits. The standard response to the problems is to rhapsodise about the amazing “possibilities” of tech and recite “all we need is education in its proper use”. Really?

There has never been anything to match the intimate, innately addictive nature of this new technology – or anything with such profound effects that was embraced so recklessly on such a mass scale.

PostComparing it to the appearance of television is absurd: families used to watch programmes together. They didn’t take their TV to school or work. The old flip phones were pocketed until calls came in. Now, addicts compulsively clutch their devices, shutting out their surroundings. Their flashing smartphones usually ruin my Hong Kong cinema experience, despite the theatre’s on-screen “education” to switch off.

The oft-chanted reply with regards to children is that “parents are responsible”. True, but this is also another form of shifting the blame, exactly what the US gun lobby does after mass shootings. Product package warnings is another suggestion, but every cigarette pack now has gruesome warning images, yet Hong Kong is still choked with second-hand smoke.

Social media and smartphone technologies are carefully-crafted, always-with-you addictions. Founders of tech companies restrict their children’s access because they know how effective that built-in addictiveness is. A nine-year old with a smartphone won’t choose to read instead of play games or watch videos.

The “parents are responsible” slogan is an oversimplification. Their responsibility often translates into simply taking away the child’s phone, which backfires in schools where phones are permitted because there is always one child with the latest model, who immediately becomes “cool” and his or her device the object of envy. France is currently in the process of banning smartphones in primary and middle schools. A good start, but the solution for children is complex.

A child absorbs his or her environment, especially at home. “Educating” children about proper use is hopeless unless their home life reflects the message. Cellphone-addicted parents produce cellphone-addicted children. “Do as I say, don’t do as I do” doesn’t work – especially given the Hong Kong “delegating” parenting style of assigning a helper and tuition schools to be surrogate parents.

Parents must participate in their children’s education. There has been considerable documentation about the benefits of something I grew up with: parents reading with their children.

Parents are busy and may not be great readers, but the skills and attitudes engendered and the parent-child bond created outweigh the challenges. The sad truth of Dr Turkle’s book title, Alone Together, becomes painfully obvious when you see a family having dinner, not speaking, each engrossed in his or her phone.

One of the most damning references in the letter from the California State Teacher’s Retirement System to Apple was a study showing that children in a technology-free environment for five days had greater empathy afterwards. “If you don’t use it, lose it.” If we keep substituting technological experiences for real ones, we will lose everything.

Robert Badal is on Facebook at Ba Lao Shi Perfect English

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Why big data must be shared to realise Hong Kong’s smart city vision

CommentInsight & Opinion

Christine Loh says data transparency across government departments and access to information from private companies providing public services are needed to create a smart, sustainable city

Experts have warned that Hong Kong could slip behind in the use of big data. The challenge requires data sharing across government departments, so they can compare information and assess correlations for Hong Kong to function better across the board. Being a smart, sustainable city is all about maximising efficiency by saving as well as sharing resources.

Managing a city in the age of the internet of things requires governments to have the relevant data in the first place. In some cases, authorities have the data because essential services, such as electricity, water and transport, are provided by the public sector.

There are cases where all or some of those services are in private hands. Unless there are arrangements whereby private operators are required to provide the data to the authorities, accessing it is not easy.

In Hong Kong, electricity data belongs to private companies as power generation and supply are in private hands. While the electricity companies provide excellent services at a reasonable cost to users, they are not obliged to share all their data with the government. Now that energy saving has become a major part of the city’s climate-change efforts and creating a smart city is another policy objective, not having the data is an obvious hindrance.

The new schemes of control reached last year for the two electricity companies are more data transparent than before but there is room for improvement. Data for individual buildings would enable the government to draft sharper policies and help occupants be more energy efficient.

This contrasts with freshwater supply, which is provided by the Water Supplies Department, where the government has the full range of data to consider what it can do to save water. While it uses technology to identify leaks and get public water pipes fixed quickly, the department only stepped up dealing with private water pipe leaks after a highly critical Ombudsman report in 2015.

Another problem is the inability to raise water tariffs. The government is fully aware Hong Kong’s cheap water encourages wastage but fears legislators will object to any increase. So, the challenge in this case has not been the lack of data for analysis but the lack of will to deal with problems.

Mobility data presents other challenges. While the government is the largest shareholder of the MTR Corporation and can presumably access the data it needs, this is not the case for all other trips. Buses, minibuses, taxis and ferries are all operated by private companies. Small providers, such as minibus owners, may only collect minimal data.

Private companies providing public services say they can’t share data because of privacy issues or because it is commercially privileged information. In the case of water supplies, no one has complained about the government knowing how much water users consume or indeed waste. It is hard for the energy companies to make a case on privacy grounds. As regards whether releasing the data would lead to unfair competition between the two electricity providers, there could be arrangements whereby the full data could be given to the government on a confidential basis, which the government could then release publicly in a form that avoids unfair competition.

Transport data is mostly anonymous, although new services such as Uber don’t want anyone to access their personal ride histories. Even here, the companies can provide data without showing details about riders.

Data is king and it is a major policy issue for the government to work out with the private sector.

Christine Loh is chief development strategist and adjunct professor at the Hong Kong University of Science and Technology’s Division of Environment and Sustainability