Canada Prosperity and Parochialism

By JAMES L. GRAFF VANCOUVER

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.

The business community, on the other hand, contends that Asians are being unfairly singled out. Asian migrants account for about 20% of immigration to Vancouver; most of the remainder are arrivals from other Canadian provinces. Says Michael Goldberg, executive director of Vancouver's International Financial Center: "Without the Hong Kong people coming, we're not going to create jobs, and if our kids don't work, we won't have to worry about them buying houses." Mayor Gordon Campbell, a former real estate developer, agrees. Says he: "The city is starting to get the critical mass it needs for a more robust economy, and foreign investment is a big part of that."

The debate has left the new immigrants baffled and uneasy. Says Tom Chan, 42, a textile manufacturer and retailer who came to Vancouver from Hong Kong with his family a year and a half ago: "I tell my friends not to overreact, but now our people feel they have to be defensive." To mitigate the criticism, Asian developers are volunteering to advertise available housing units in Vancouver before offering them abroad. In a different goodwill gesture, one Hong Kong family anonymously donated $8.43 million to the University of British Columbia for a new international performing-arts center.

Vancouver's 130,000-strong Chinese community, third largest on the west coast of North America, after Los Angeles and San Francisco, has faced worse troubles in the past, including a near total ban on Chinese immigration from 1923 to 1947. Nonetheless, the latest contretemps rankles. Says Hanson Lau, a radio producer and a Vancouver resident for 23 years: "You don't hear anyone talking about the Canadians who sold their houses to the Hong Kong Chinese at a profit. Sooner or later, people are going to have to face the fact that the city is grown up -- whether they like it or not."