Hong Kong has built its reputation as a free-wheeling, innovative and sophisticated city. Just like New York, it is known globally as a vibrant metropolis, which never sleeps and where money still talks.

But is this view outdated, a facade constructed more from fantasy than reality? Certainly, business professionals, analysts and academics, who talked to Asia Times, are starting to voice serious concerns.

They point to a myriad of problems, which are buried beneath the surface, such as monopolies in an array of sectors from transport to supermarkets.

Underlining fears that “the rule of law” has been eroded by the “One Country, Two Systems” policy after Hong Kong was handed back to China by Britain in 1997 also loom large in the background.

“In Western countries, the rule of law is a core value. But it is different in Hong Kong as it belongs to China,” Andy Kwan Cheuk-chiu, who runs ACE Center for Business and Economic Research, a Hong Kong think tank, told Asia Times.

“Beijing’s reinterpretation of the Basic Law of Hong Kong might create certain political issues but it will not worry businesses as long as they make money,” Kwan, a former associate economics professor at the Chinese University, added.

In the 2018 Economic Freedom Index rolled out by the Heritage Foundation, a conservative public policy think tank based in Washington, Hong Kong retained its No. 1 position.

Yet even in a sanguine review, there was a caveat inserted into the section governing the “Rule of Law”, casting a shadow over the independence of the judiciary in the Special Administrative Region.

“An exceptionally competitive financial and business hub, Hong Kong remains one of the world’s most resilient economies,” the Heritage Foundation study stated. “A high-quality legal framework provides effective protection of property rights and strongly supports the rule of law. There is little tolerance for corruption and a high degree of transparency.

“The judiciary is independent, but Beijing reserves the right to make final constitutional interpretations, effectively limiting the power of Hong Kong’s Court of Final Appeal. Although the corruption rate is low, it is perceived as rising,” it added.

With such a multi-layered society, perception is a crucial part of everyday life for the 7.4 million people who live in an area of 106 square kilometers or 41 square miles.  Alongside a dense population, property prices have soared at breakneck speed, leaving many unable to afford a home of their own.

A report released in January by Demographia, entitled the International Housing Affordability Survey, showed Hong Kong was still the world’s “least affordable city” – a title it has held for seven straight years.

The United States-based consultancy reported that prices were more than 18 times the median annual pretax household income. A score of more than five times is considered “severely unaffordable,” according to its website.

“Hong Kong is like a confectioner’s jelly, it looks great from the outside but internally it is melting,” Neville Sarony, a practicing QC in Hong Kong and a former Professor of Law at the City University of Hong Kong, told Asia Times.

“As I see it, there are two overarching but interconnected problems: 20 years of increasingly dysfunctional government and the paralyzing greed of the property developers,” he added.

Similar concerns exist in the retail and transport sectors, which could squeeze growth and strangle competition.

Despite what many consider a world-class metro system, road congestion and inadequate transportation in new towns have left parts of Hong Kong with a major gridlock headache, adding to the city’s pollution problems.

Quentin Cheng has been an outspoken critic of Hong Kong’s transport policy and is convinced a lack of serious competition needs to be addressed.

“Our town planning does not adopt a holistic approach, and only focuses on small areas of land. The Development Bureau just generates slogans and does not carry out the concepts. What we need is competition [in the industry],” Cheng, who is co-founder and spokesman for the Public Transport Research Team, told Asia Times.

“Hong Kong’s rail networks are too small and inadequate. [They do] not cover a lot of areas, compared to other developed [cities and districts]. They should build more direct rail routes connecting different districts together,” he added.

As for the highly vaunted retail industry, its veneer of choice has been peeled away to reveal a sector controlled by two supermarket chains.

In a study compiled by Euromonitor, retail sales of food and beverages in Hong Kong reached US$11.9 billion “with supermarkets accounting for 55%” of the market.

Two grocery groups, Dairy Farm International’s Wellcome brand and AS Watsons’ ParknShop, dominated the scene, accounting for about 75% of the revenue.

“There is a monopoly in Hong Kong’s supermarket sector with Park’n Shop and Wellcome, [while] most of our pharmacies belong to Watsons and Mannings,” Ho Hei-wah, a veteran social activist and director of the Society for Community Organisation, a rights group for the disadvantaged, told Asia Times.

“The elements of a monopoly exist in different industries [which means] small and medium-sized enterprises cannot bid [for] government projects because they haven’t worked on [them] before,” Ho, who is known as the “voice of the poor” in Hong Kong circles, added.

“Monopoly” is a word that crops up often in a city which is not only struggling to retain its identity but its unique competitive spirit.