Face Off: Should Hong Kong scrap the 'two-can' export limit?

Face Off: Should Hong Kong scrap the 'two-can' export limit?

Each week, our two teenagers will debate a hot topic. This week ...
Kate Ng Yu-yan, 18, The University of Hong Kong (Negative)

The two-can limit on infant-formula milk-powder exports was announced in February and introduced the following month. It was important to make sure local families and their babies had access to milk powder to cover their needs.

The huge demand from mainland families for our milk powder meant lots of people were coming here and buying huge quantities. Then they sent them across the border and sold them for a huge profit.

Many of the traders buying the milk powder didn't want it for their own family. They were simply using it to make money. It meant stocks of infant-formula milk powder often sold out, so local families were left struggling to buy it for their own babies. The two-can limit helped with the situation.

Some economists have argued that this restriction on buying milk powder interfered with the city's free-market system. The debate is still going on.

If the restriction is lifted, we need to be sure the problem does not simply return again. The two-can restriction has successfully stopped infant-formula milk powder from being sold out. It is right that local mothers and their babies are protected by the Hong Kong government - and that the interests of local people come first.

Hong Kong has gained an international reputation for being one of the freest economies in the world. But the government has a duty to ensure local resources are not being abused by people outside Hong Kong. So it is necessary for the government to sacrifice some market freedom for the sake of its people.

Before the limit is lifted, Beijing must solve the problem of the mainland's poor food safety record.

Once confidence in the mainland's food-manufacturing industry has been restored - so mothers there can buy infant formula without worrying about its safety - that will be the right time to remove the restriction.

Cathy Chan Chi-man, 19, Baptist University (Affirmative)

The limiting in March of exports of baby formula milk from Hong Kong has caused great controversy, both here and on the mainland.

Supporters of the rule complain that mainland traders buying too much led to shortages in Hong Kong. They say the government should keep the limit to ensure there are enough for supplies for locals.

However, in the interests of boosting the local economy and improving relations with the mainland, I believe it is time to lift the restriction. Keeping the limit in place will damage the principles of free trade that Hong Kong is built on. Hong Kong is a member of the World Trade Organisation's General Agreement on Tariffs and Trade. The agreement means Hong Kong should not "institute or maintain any prohibition or restrictions, other than duties, taxes or other charges, on the export of any products".

This rule can be used to stop critical shortages of foods, or other important products. But the milk-powder limit no longer satisfies this requirement: the infant-formula supply is now stable.

Even during October's "Golden Week" holiday period, the supply of infant formula was stable, including that of popular brands that were hard to find before the limit; in some cases, there was even a surplus.

Now that the situation is back to normal, we should end the limit to maintain our reputation as a free port. Keeping the limit will increase friction with mainlanders. The restriction is clearly targeted at mainland traders; many buy milk powder, which is in demand, and sell it at a higher price over the border.

However, what about those mainlanders who want to buy it for personal use? What do they think about such a policy? Yes, they see it as discrimination.

The reason mainlanders want our infant-formula milk powder is a lack of confidence in mainland brands since the 2008 food safety scandal. Melamine, a chemical harmful, was used at the time to increase protein levels in the milk.

The central government should review its quality checks, and milk powder companies should improve their products to help rebuild public confidence. Then the limit won't even be necessary.


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