Why Hong kong is so costly to live, to shop, and for daily necessities?I feel the living standards is so high.

Question

The Oriental Daily News(April 14,2008,Chinese edition)has published article with headlines of: The Agriculture and Fishery conservation Departure is the root cause of major fruit and vegetable prices up 14% more in Hong Kong. Oriental Daily News accused that the A&FCD has raised the rent of the tenants of the wholesale/distributor by 11.4% recently. The food distributors are needed to raise average food prices by average of 10-12% to balnance their budget. The touchy scene is many old aged Hong Kong citizens are picking up the rotten vegetables and sort out small amount of still eatable fruit and vegetable. The wholesales market in Sham Shui Po is filthy, toilets remain uncleaned, rats are all over, and many local food pickers are trying to get some of the rotten surplus in the dump. Hong Kong looks like a third world, many say. I phoned the VOM(Vegetable Market Organization,also a Hong Kong government regarding the rent raise question, they denied it and said that they never know this

Answer 1

First, most agriculture products in Hong Kong are imported from China.  China 2008 first quarter inflation rate is over 8% which affect prices in Hong Kong as well.  Second, Chinese produces such as pork and beef from China are imported through only 1 appointed importer, making it a monopoly, and everyone know what a monopoly can do to prices.  Third, real estate price is very high in Hong Kong, in some areas, it surpassed the 1997 peak prices.  Most retailer have to raise prices to keep up with the rental expense.

Answer 2

I think the highest cost in Hong Kong is the price of housing.  Due to scarcity of land (they build up), flats are very costly.  There's government housing but you have to wait forever to win that lottery.  Price of food is relatively cheap, they do have lots of imports but there's no sales tax on products.  Govt does provide a very small stipend to the elderly but what they're going through is common in lots of places.  There is always a sharp contrast between extreme poverty and excess in all developed countries.

Answer 3

Many, and most of the consumer goods for sale in Hong Kong, are shipped there, which is an expensive procedure, couple that with the "Free market" philosophy the Chinese government has allowed to continue, it is a license to steal for some entrepreneurs.