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I don't think it makes any practical sense. Hong Kong by default is using cremation, unless some rich person have a land for them to keep their body inside a coffin because Chinese tradition prefer keeping the whole body after dead. Even if disposed to sea, they still need to build a grave for them. Cremation only required to have the space of urn to place, and a gravestone. The urn does not take many space. If graveyard is still required to build, it does not save too much space.

The alternative that saving space is just sent them back the urn of ash and people just put the gravestone at home. But putting dead body, even in ash, is taboo in Chinese tradition and nobody would accept it.

It is difficult to execute a policy that opposing the local tradition, and it is not really necessary.