Welcome to The Club, Hong Kong

A sociologist wanting to observe the Hong Kong expatriate in his native environment could do worse than
to ride the Discovery Bay ferry at rush hour. The boat connects the office towers of Hong Kong's main
island with Discovery Bay, a bedroom community (population 15,000) on the bucolic island of Lantau that
has long been a nesting area for foreigners who prefer to maintain some distance between their families
and the tumult and congestion of the city's core. Ten years ago, a trip on the ferry would have placed you in
the company of three principal foreign species: Brits, Americans and Canadians. These days, the ferry
crowd is a very different mix. At 7 a.m. on a recent spring day, many passengers are pecking at BlackBerries
and talking on mobile phones, but eavesdropping is practically impossible because too many languages are
in play. Cantonese and English may be Hong Kong's primary tongues, but on this 30-minute trip to Central,
you'd be just as well off knowing Hindi, Mandarin, Malay or Spanish.Maoshan
Or, if you happen to sit behind Dagmar Hartley, best to try Czech. Hartley, 45, escaped Czechoslovakia in
the 1980s and fled to Canada, where she met and married a shoe distributor whose business shuttled the
couple between Canada and Europe for most of the 1990s. Three years ago, Hartley accepted a position
managing a supply-chain operation in Hong Kong, and with two kids in tow, the family moved to the SAR.
"I've always followed opportunity," Hartley says, "and there's no smarter place to be than Hong Kong right
now. It's the gateway to China."

Welcome to The Club

In a way, Hartley and the ferry's rainbow coalition of arrivistes are not supposed to be here. In 1997, the
conventional wisdom was that post-handover Hong Kong was destined to become "just another Chinese
city," a phrase that was repeated so often some joked it should be made the SAR's official motto. With
Beijing in control, the thinking went, Hong Kong's international and cosmopolitan charms (English spoken
nearly everywhere, trains running on time, good Italian restaurants, etc.) would quickly fade. Foreigners
would depart by the planeload, especially the Anglo-American crowd that dominated politics and business
during British rule.
That assumption has turned out to be partially correct: Westerners have indeed fled in droves. Over the
past decade, economic setbacks like the Asian financial crisis and the SARS scare caused companies to cut
back and sullied Hong Kong's reputation as a land of opportunity in the eyes of many gweilos ("ghostly
men," as Caucasians are called locally). Between 1996 and 2006, according to census data, the number of
British citizens living in Hong Kong plunged 85%, from 175,000 to 25,000. Once Hong Kong's largest
foreign contingent by far, Britons are now vastly outnumbered by the Filipino domestic helpers who once
watched their kids and did their laundry. American and Canadian populations have also declined. Last year
there were 15,000 fewer Americans (down 53%) and 20,000 fewer Canadians (down 63%) calling the SAR
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home than there were in 1996. Overall, there has been a 23% drop in the number of Caucasians, from 47,000 to
36,000, in the past five years alone.
But predictions that "Asia's World City"—the government slogan for Hong Kong—would as a result of this exodus
become more provincial and more like mainland China have not come to pass. The faces may change, but the size
of the international community has remained fairly constant. In 1996, there were 594,000 foreigners in Hong
Kong, or 9.6% of the total population. The proportion dropped to 6.7% in 2001, but the ranks have been rising
since then, to 7.1% in 2006. As the old guard left, they have been replaced by others from developing nations who
are attracted to Hong Kong's booming economy. For example, between 1996 and 2006 there was an influx of
9,000 South Asians (Indians, Pakistanis, Bangladeshis and Sri Lankans), a 43% increase. During the same
period, the number of Indonesians leaped fivefold to 110,000, making them the third-largest group behind
mainland Chinese and Filipinos. Overseas ethnic Chinese are also migrating to Hong Kong. From 1996 to 2006,
their numbers increased 33% to 86,000, making them the fourth largest group.
Today, foreigners from other Asian countries account for nearly 80% of the city's international contingent—and
many say Hong Kong is a more open and equitable place as a result. "Expatriates have changed from being part
of a dominant and privileged clique to a diffuse presence in a cosmopolitan city," local author May Holdsworth
wrote in her 2002 book Foreign Devils: Expatriates in Hong Kong. Says Margaret Shaffer, an American
academic formerly with Hong Kong Baptist University who studies the city's international community: "You
notice more non-Chinese Asians, more Indians, more non-Western Europeans in the workforce than ever before.
Simply put, Hong Kong has become a more diverse place to live."
This diversity is perhaps most apparent at Chungking Mansions, a warrenlike, low-rent residential complex in
the Tsimshatsui district that houses thousands of Hong Kong's foreigners. Gordon Mathews, a professor of
anthropology at the Chinese University of Hong Kong who has been studying the subculture of the area, says he
has identified people from 120 different countries staying there by examining guesthouse logs. Contrary to the
image of the Hong Kong expat as fat cat banker or multinational exec, those who call Chungking Mansions home
hail from Asia's poorer countries such as Nepal and Bangladesh. They have come to Hong Kong hoping to make
money by washing dishes, working in construction or hawking fake Rolexes to tourists. Mathews calls the district
a "center for low-end globalization."
Across the harbor in the commercial high-rises of Hong Kong island, demographics have undergone a similar
diversification. Not long ago, Abdullah Mohamed Hashim might have felt out of place in the city's cubicle culture
because he's Malaysian and a Muslim. But the 28-year-old management trainee at the Dutch bank ABN Amro
says he's had no problem fitting in. "At work, no one pays attention to where you're from, only how hard you're
working," Hashim says. Like many local professionals, he works until 10 p.m. nearly every day. "Growing up in
Malaysia, most of what I knew about Hong Kong came from soap operas," Hashim says. "That I'd come to live
here? It seemed impossible. No one even considered it an option."
It's not impossible nowadays. Major corporations are increasingly seeking out talented, well-educated Asians to
fill the ranks that were once occupied by Western businessmen. "Asians are simply cheaper than traditional
Western expats," explains Vincent Gauthier, general manager of the human-resources consultancy Hewitt
Associates. Westerners tend to expect companies to pay some or all of their housing costs, educational expenses
for their children and other perks to compensate them for the hardship of living overseas. But many Asians see
life in Hong Kong as a step up rather than a hardship, so they are less likely to insist on lavish benefits. Many
multinational companies are phasing out special pay packages for foreigners altogether. "There's little incentive
for companies to pay for [Americans] anymore," says Joe Logudic, head of the human-resources committee for
the Hong Kong branch of the American Chamber of Commerce. "At this point, it's actually the Americans who
are being discriminated against."
Some might say that the habits of long-privileged Caucasians were due for a change. And indeed, the clubby
attitudes that prevailed under British rule are no longer as widespread, a change that reflects the global
economic ascendance of developing countries such as China and India. "Indians are held in higher regard now,"
says Nisha Israni, a flight attendant who moved to Hong Kong from Mumbai (formerly Bombay) 10 years ago.
Israni's husband, Jaideep Malhotra, an executive at a U.S. technology-services company, explains that despite
Hong Kong's long-established and vibrant Indian community, his compatriots only recently began seeking out
white-collar jobs. "Twenty or 30 years ago, Indians only came to Hong Kong to be low-skilled workers," Malhotra
says. "Now we're accepted as professional peers."
Malhotra and Israni met in Hong Kong and married seven years ago. They have made numerous friends in their
Kowloon neighborhood and through their membership at the Kowloon Cricket Club. They say they intend to
stay—and that attitude, too, is something that's different about Hong Kong's new breed of foreigner. Prior to the
handover, those who worked in Hong Kong tended to view the city as a stepping-stone along a career path that
ultimately led back home. In 1996, nearly half of all expats left within three years; today, less than a third do.
"Now, foreigners come to Hong Kong to build a life," says Paul Yip, a demographer at the University of Hong
Kong. "They've seen all of Hong Kong's flaws, they know the risks, and they're prepared to stay."
Not all of them, of course. For some foreigners, Hong Kong's choking air pollution is a deal breaker. A survey of
140 foreign executives conducted last year by the American Chamber of Commerce found that 39% struggled to
recruit talent due to the poor air quality. Another 55% of those who responded said they had heard of
professionals unwilling to move to Hong Kong for that reason, and 78% said they knew of foreign workers who
were considering leaving the city to escape the smog. Israni says it's the one thing that could drive them away.
The persistent haze that envelops Hong Kong harbor aggravates her 4-year-old daughter's allergies. "We're at the
doctor several times a month," Israni, 33, says. "It's very distressing."
But for the fastest-growing group of folks from outside Hong Kong moving into the territory, air quality may not
matter so much. Cathy Guo and Jeff Hong, a couple from the Chinese mainland, guess that the air is actually
cleaner in the Hong Kong suburb of Hang Hau than it is in their hometown in Anhui province. Guo, 29, and
Hong, 31, moved to Hong Kong in July 2004 from Chicago, where Hong earned his doctorate in industrial
engineering, which he now teaches at the Hong Kong University of Science and Technology. It's a tenure-track
position that matches any opportunity he would have had in the U.S., he says. "Here we can be near our
families," Hong says, "but the pay and lifestyle are still much nicer than Shanghai or Beijing."
Hong reckons some 40% of his colleagues are also originally from China's mainland—which is not surprising
since at any given time, tens of thousands of mainlanders are waiting for their applications to reside in the SAR
to be approved, a process that can take up to three years. The Hong Kong government restricts immigration by
mainland Chinese to about 55,000 new residents a year to prevent them from flooding the city. That cap is easily
reached most years; since 1996, nearly 580,000 have been issued Hong Kong residence permits, which makes
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the mainland overwhelmingly the largest source of Hong Kong immigration since the handover. Last year, there
were 217,000 mainlanders (3% of the population) living in Hong Kong, making them the largest foreign group.
Indeed, due to a low birthrate among citizens, Hong Kong's population would hardly grow at all if it wasn't for
the steady, strong stream of migrants from the motherland. After all, Hong Kong has always been a Chinese city,
and that it will remain. But 10 years after the handover, its rich and richly muddled heritage continues to attract
people from all over the world. "Just another Chinese city?" Not even close.

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