It would not be possible for a new firm producing the same services to join this market as there is no room in the underground to build a new set of railway tracks for another company. MTR, despite being a monopoly, is highly backed by the government it is able to achieve economies of scale and purchase and maintain trains cheaply. This is reflected on the relatively cheap prices of tickets to the general public. It would be impossible for a new firm to join the market as not only would there be high costs and time needed to start the construction, but because the government would undoubtedly intervene. In addition, MTR is a member of the Association for Sustainable and Responsible Investment in Asia (ASRIA), which meant that one of its aims is to contribute towards a sustainable environment. In 2004, MTR was named "the first 'Best Sustainability Report' in recognition of its efforts" (ASRIA. 2004). It would be implausible for another company to build another set of railway lines as it would not be environmentally friendly and it would not have the price advantage that MTR has because of the government's majority stake in it.
