Canada Prosperity and Parochialism

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Set like a jewel between snow-covered mountains and deep Pacific Ocean inlets, Vancouver, Canada's third largest city and site of the 1986 world's fair, has inspired great pride among its residents. Unfortunately, intense pride sometimes degenerates into parochialism -- or worse. A city alderman intervened recently to stop local merchants from selling T shirts with the slogan HONGCOUVER, B.C. '89. "When I go out I'm absolutely surrounded by Asiatics," complained longtime Vancouver resident John Smythe at a public hearing on immigration last month. "If the doors are wide open, what's going to happen to the Caucasians?"

Fueling the racist rhetoric is the fact that Vancouver's prosperity has been boosted by the heightened inflow of immigrants and money from Hong Kong. Encouraged by Canada's relatively liberal immigration policies, more and more Hong Kong Chinese are arriving in Vancouver to put down roots before 1997, when the British colony reverts to Chinese sovereignty. That does not please some of greater Vancouver's 1.4 million residents, who see the influx -- 5,000 Hong Kong immigrants came to the region last year -- as a threat to their life-style. Critics grouse about an "Asian invasion" that has sent housing costs skyrocketing 50% in the past year, making Vancouver the hottest real estate market in Canada.

Hong Kong accounted for more than 22% of the 22,765 immigrants who arrived in British Columbia last year, and a major portion of the foreign investment. Just over 2,000 Hong Kong families brought more than $689 million with them, mostly to Vancouver. Other Hong Kong investors have poured millions into the city, a surge that was dramatized a year ago, when the choice 204-acre site of Expo 86 was sold for $260 million to Li Ka-shing, patriarch of one of Hong Kong's biggest trading families.

Local real estate analysts estimate that Hong Kong investors are involved in 60% of new condominium construction and 25% of all apartment-building sales this year. Asians purchased more than $420 million worth of commercial real estate alone last year. Total Vancouver real estate holdings of Hong Kong Chinese: $2.1 billion.

For old-time residents, the problem seems to be less the buying binge than the perception that their neighborhoods are being offered on international markets far removed from local buyers. The unease crested last December, when condominium units developed in Vancouver by Li were snapped up in Hong Kong within 2 1/2 hours of the offering -- before they were even put up for sale in Canada. Says Susan Alexander, a member of a local group that is demanding stiffer government controls on foreign real estate buyers: "Our housing is being treated like a commodity on the stock exchange." Alexander is being evicted from a three-story, 20-unit apartment complex that will be replaced by a twelve-story, twelve-unit luxury condominium development.