Sunday Brunch: tales of the unexpected

Sometimes things don't work out as you expect. Even with the best of intentions the complexity and interconnectedness of systems mean that there can sometimes be unintended consequences.

I recently returned from a business trip to Hong Kong. I lived there and worked with a fantastic team at Morgan Stanley from January 2008 until December 2009 establishing the content development team for Asia ex-Japan.

They were... interesting times. I arrived into a bull market, experienced a global financial crisis, MS moved offices from Three Exchange Square to the ICC (half built at that point!) and the recovery and development in China with hope and optimism.

But developing a new function with a blank sheet of paper and working with teams across MS was a wonderful experience and ranks amongst the best times of my career.

So it was great to be able to come back to Hong Kong and meet with former colleagues from MS and see what was the same and what was new. One new thing was the Hong Kong to Zhenzhen high speed rail link.

When first proposed I had thought (along with much of the speculation at the time) that we would see people living in Shenzhen and commuting into Hong Kong (15 mins into Kowloon station and then a hop and a jump on the MTR into Central). However, what seems to have happened is the phenomenon of day tripping and price arbitrage. During 2023, Hong Kong residents made more than 40 million trips via the Shenzhen-Hong Kong port.

For example, they have been heading to Costco in Shenzhen for their big grocery shop

And even going to Shenzhen for a haircut! Really? Let's look at some numbers.

The high speed rail journey from Hong Kong West Kowloon to Futian (the first district you reach in Shenzhen takes 14 minutes and costs HKD 225 in business class for an adult, HKD 112 for a child. That cost drops to as low as HKD 75 and HKD 37 for an adult and child respectively in second class. To put that in perspective, I paid HKD 44 for a regular sized mocha at Starbucks in the IFC Mall in Central.

The average price of a men's haircut in Futian is RMB 88 or about HKD 95.

So that means with return travel included the cost of the haircut in Shenzhen is HKD 245. The average cost of a haircut in Hong Kong is around HKD 250 - 300.

So an unintended consequence of the high speed rail line is that the flow of people is the reverse of what we thought.

The transition to a more sustainable world is a complex process that aims to address pressing environmental, social, and economic challenges. While the overall goal is positive, there could be some unintended consequences that arise during this transition.

Let's look at that and discuss a few examples.

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Sustainability transitions and unintended consequences

Transition requires change. Change is hard and brings positive and negative consequences. For example as we move away from fossil fuel-based industries and towards renewable energy sources, there might be job losses in certain sectors, such as coal mining and oil and gas extraction. This could lead to economic hardship for communities and individuals heavily reliant on these industries, unless proper retraining and alternative employment opportunities are provided.

Adoption of new technologies and products could generate significant amounts of waste, particularly electronic waste (e-waste) and discarded batteries, if not properly recycled or disposed of. Although this is an area which is being addressed, particularly in China.