ANALYSIS by Vaudine England, BBC News, Hong
Transcript of ANALYSIS by Vaudine England, BBC News, Hong
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ANALYSIS
By Vaudine England, BBC News, Hong Kong
Two things have made global financial meltdown obvious in
Hong Kong: daily protests by people who bought what they thought were
safe bonds but turned out to be worthless when Lehman Brothers
collapsed, and the seemingly permanent sales in the malls.
The larger-than-usual number of ships moored in waters south of Hong
Kong, or travelling light in and out of southern China's factory zones, has
been another clue, as has the growing numbers of homeless and
unemployed, some of them returning from jobs on the mainland.
But for the majority still in jobs, and without negative equity given the
continued buoyancy of Hong Kong's property market, there has not been
an obvious recessionary feeling.
A recent survey suggested Hong Kongers were spending - and saving - as
much as usual. Hong Kong has always had an optimistic feeling about it.
Economic Recession, Government Policy and Workers' Welfare
S. H. Tang
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Introduction
Business cycle is a basic characteristic of capitalism. The Hong Kong economy is of no
exception. The present economic recession, unfortunately, is the worst one in Hong Kong
since the 1960s. With negative GDP growth in the first half of 1998 and unemployment rate
reaching 4.8% for the May-July period, it may take a long time for the economy to ride out
the tough of the cycle.
With massive lay-off and pay-cut, and without a mandatory unemployment compensation
fund, Hong Kong workers are hardest hit in this recession. Triggered by the Asian currency
turmoil in last October, the economic recession in Hong Kong has been dampened by short-
sighted economic policies since the 1980s. The labor unions have long been arguing that
labour welfare has been ignored under the prevailing economic policies even without this
recession. They also express grave concern that workers?welfare would further deteriorate
after the economic recovery.
Conflict of interest between workers and capitalists is an inherent nature of capitalism. The
collective strength of labor unions is an effective and powerful weapon to safeguard the
workers?welfare. But the divergent and competitive political affiliations of labor unions in
Hong Kong deter them from forming a common front to deal with employers. The Hong
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Kong government is supposed to look after the welfare of all sectors, including workers. But
in reality it gives more weight to the wealthier. There are no laws on collective bargaining and
on minimum wages in Hong Kong. Having less political and market powers, the workers are
in a disadvantaged position in protecting their welfare and entitlements.
Prevailing Economic Policies: Positive Non-interventionism and Workers' Welfare
The Hong Kong government is noted for its economic philosophy of positive non-
interventionism. The main thrust of this philosophy, simply put, is to rely heavily on the
market mechanism to allocate and distribute resources and outputs. The government's role is
to safeguard the rule of law, to protect property rights, and to provide infrastructure. The
government would intervene in the market only after careful examination of the costs and
benefits of its actions. In most cases, the government would not intervene, even if the short-
term results of intervention are desirable. The government also relies on low tax rates and a
simple tax system to attract foreign investments. Financial stability is more important than
economic stability. Thus the guiding principle of fiscal policy is to pursue "living within our
means". Keynesian countercyclical policy is considered by the government to be
inappropriate for Hong Kong. The very objective of economic policy is to generate rather
than to redistribute wealth. The government avoids addressing income disparity, arguing that
the fruit of economic growth is trickled down to workers through creating more jobs and
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paying higher wages, means which are more desirable than political struggle. Unfortunately,
the worsening income disparity since the 1980s has proved that the "trickle-down theory" has
not really worked in Hong Kong.
Without a mandatory unemployment compensation fund, workers face an even harsher
situation during the economic recession. Workers could only hope that the government could
stimulate the economy so as to create more jobs. However, this approach would imply having
budget deficits potentially, which the government wants to avoid. A classic example is the
government's position on a motion debate in the Legislative Council in 1995 when the
economy could not reach the estimated 5% growth target. The motion requested the
government to adopt appropriate policies so as to ensure the 5% target be reached. The
government refused to endorse the motion, arguing that the estimated 5% GDP growth rate
was arrived at after taking into account the overseas and local economic conditions, including
the government's budget drafted under the guiding principle of "living with our means". Thus
it should be seen as a result of market operations, rather than a government target. The
Councillors were even warned that it would be unwise and dangerous to push the government
to stimulate the economy because this would disturb the proper functioning of the market, and
would move Hong Kong into a planned economy.
This ultra fiscal conservatism does not only rule out the role of short-term fine-tuning
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functional finance, but also ignores the adverse impact on the long-term growth potential of
the economy. The Hong Kong government spends less than 6% of its total expenditure on
economic affairs, including industrial programmes. With total public spending accounting for
less than 20% of GDP, the amount spent on industrial programmes is too small for any
meaningful long-term development. In fact, there was no subsidy given to encourage R&D of
manufacturing industries in the 1980s. The Applied Research Fund, set up in 1992, attaches
many conditions which discourage rather than promote applications. Tax incentives are
virtually nonexistent for industrial development and promotion. Under this passive industrial
policy, the contribution from the manufacturing sector to the economy has declined from
23.7% in 1980 to just 7.2% in 1996. Manufacturing employment has dropped from close to
one million in 1980 to just 309,000 in 1997. The growth potential of the economy has reduced
to 5% in the 1990s due to inadequate spending on domestic fixed capital formation.
Alarmed by the declining share of the manufacturing sector, a prominent business group
commissioned a consultancy study in 1989 on economic strategy for Hong Kong's future.
Two of its recommendations relate to industrial R&D and training: (1) total public and private
spending on R&D and on industrial training should target at 1% of GDP respectively; (2) the
above cost should be shared equally by the government and the private sector. The other three
newly industrialized economies (NIEs) in Asia have already passed this 1% critical mark.
These recommendations, if accepted, would exert significant impact on economic
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restructuring and job creation for the 1990s. They would also enhance the capacity of the
economy to absorb external shocks.
Unfortunately these recommendations were not endorsed by the government which argued
that increased spending commitment would violate the guideline that expenditure growth
should not exceed the trend assumption as to the growth in GDP. When the other NIEs such
as South Korea, Taiwan and Singapore have already injected over 1% of their respective GDP
to R&D, it is no wonder why Hongkong's manufacturing industries have lost their
competitive edge to these NIEs in high-technology content products, and to Mainland China
in labor-intensive low-technology content products. The decline in manufacturing share in
GDP translates into a loss of over half a million manufacturing jobs. The Employee
Retraining Programme, set up in 1992, only provides retraining opportunities to those
displaced manufacturing unskilled workers to seek low-paid employment in the services
sector, not to retrain them to move to high-tech industries. Promoting services industries as
the main source of economic growth in Hong Kong is the theme of the 1996-97 Budget. But
the initial injection to the Services Support Fund is only HK$50 million, and there has been
no significant change in the share of government spending on economic affairs. Simply put,
the Hong Kong government has not provided enough resources for economic restructuring
and labor retraining.
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Human resource development policy is an integral part of economic restructuring. In Hong
Kong, the largest share of government expenditure goes to education. Paradoxically, the
education policy and programmes could not accommodate economic development and
restructuring in Hong Kong. Three major problems have become prominent in the 1990s: (1)
the education and training programmes could not produce graduates with knowledge and
skills specific to high-tech industries; (2) the standards of language (i.e. English, Putonghua)
proficiency of our graduates are declining; (3) the teaching and quality of information
technology are lagging behind other NIEs substantially. The lack of coordination between
economic and education policy bureaus on developmental strategy is the root cause of this
poor performance.
Hong Kong may be the only place where the government does not publish any white paper
on short-term and long-term economic development strategy and plan. The is because the
research culture is underdeveloped within the government. The Economic and Financial
Services Bureaus are the only governmental agencies that have a research unit equipped with
a few professional economists. Economic policies are seldom discussed publicly. Co-
ordination between economic policy and other policies is viewed mainly as a technical issue
of secondary importance. This explains why the above mentioned deficiencies has prolonged
and deteriorated throughout the 1990s. Improving these deficiencies must involve substantial
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resources. But money is not forthcoming. Because of the small size of the public sector,
spending on education accounts for less than 4% of GDP in Hong Kong. This ratio is even
smaller than many developing economies. Inadequate resources on formal and informal
education and training could not produce and maintain a high quality and competitive labor
force which is so crucial for sustaining economic growth and job creation. Ironically, neither
the Secretary for Education and Manpower nor the Financial Secretary has aimed at a higher
target for education spending.
An imbalanced economic structure, a less competitive labor force, and the guiding principle
of fiscal conservatism are long-term factors that have reinforced the recessionary forces
generated by the recent Asian currency turmoil. It is expected that the economic situation in
the second half of this year will be even worse, due to the new airport crisis in the July-
August period.
A New Paradigm Shift?
Contrary to the outright rejection of the Legislative Council's recommendations to
stimulate the economy during the 1995 mild recession period, the Hong Kong government
introduced a Mini-Budget in June 1998, which converts the original $10.7 billion 1998-99
budget surplus into a $21.4 billion deficit. The Mini-Budget contains new initiatives such as
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increasing spending, offering tax/fee reductions, and freezing land sales, etc. Although this is
the largest deficit budget in the public finance history in Hong Kong, its expansionary effect
is uncertain because the projected deficit arises mainly from revenue loss from freezing land
sales, rather than from massive tax reductions and rebates or spending increase. Thus it does
not reflect a genuine shift of the fiscal paradigm of the government.
Having no unemployment compensation fund, the Hong Kong fiscal system does not
possess any built-in stabilizer to automatically fine-tune aggregate demand. Although the
Comprehensive Social Security Assistance (CSSA) Scheme does allow unemployed workers
to apply for assistance but its severe eligibility conditions limit the number of successful
applicants, rendering it as only a partial and somewhat ineffective tool of built-in stabilizer.
When CSSA spending rose suddenly above the budgeted level due to the unexpected
worsening economic situation in the first half of 1998, the Director of Social Welfare
expressed concern that the CSSA may have been abused by unemployed workers, and pointed
out that a review of the CSSA would be held in due course to close the loopholes. In fact,
none of the 9 measures of the 1998-99 Mini-Budget has relaxed the stringent eligibility
conditions for applying CSSA, nor raised the CSSA level. The Financial Secretary did
propose to set up a special $2 billion fund to assist small and medium size enterprises to
obtain bank credit, but there was no corresponding proposal to help unemployed workers
financially.
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It could be argued that the short-term fiscal measures of the 1998-99 Mini-Budget should
not be interpreted from a long-term perspective. One has to wait for more evidence and
concrete examples before tentative conclusions could be drawn. One possible outcome is that
the forthcoming 1999-2000 Budget would introduce new concepts and measures to deal with
long-term economic issues. For example, the First Report of the Innovation and Technology
Commission, to be released soon, may recommend massive subsidy to the extent of 1% or
more of GDP to support manufacturing R&D and training. The government's response to such
recommendations would indicate whether and to what extent it would shoulder an
institutional responsibility to finance proactively economic restructuring in general and
industrial development in particular.
The Hong Kong government is noted for its success and expertise in crisis management. It
has been quite successful in handling banking and currency crises before the sovereignty
transfer. One of the conditions for such success is the support from the private sector. It is
ironic that the opportunity cost of reform is relatively smaller during the crisis period.
Resistance from the private sector on policy reform would be nominal. However, this is not
the case for the 1998 recession. The government and the private sector have divergent views
on the root cause of the recession, and hence do not seem to see eye to eye on remedial
actions. Massive tax rebates and a proactive industrial policy advocated by some businessmen
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and industrialists are rejected by the government. On the contrary, the government depends
very much on the downward adjusting forces in the asset and labor markets to reduce the
rental and production costs so as to regain competitiveness for the economy. The government
argues that providing unduly public funding assistance would distort the proper function of
the market and would delay the recovery of the economy. It seems unlikely, therefore, that the
Hong Kong government is contemplating any major paradigm shift because added spending
commitment may lead to deficit budgets which would exert a destabilizing effect on the
linked exchange rate, and may even be in breach of the budgetary principles of the Basic Law
(i.e. Article 107).
Concluding Remarks
For political and historical reasons, workers have the least bargaining power in Hongkong's
capitalist economic system. In the previous studies on economic development strategy
completed by various business groups, labor unions were not consulted. As a matter of fact,
workers?welfare had never been a focal point in such studies. It is no wonder that the labor
unions have to resort to political forces in the Legislature Council to fight for their fair share
of economic output and wealth through engineering more favourable labor laws. But these
laws could neither create jobs nor guarantee job security. The recent drive by some labor
unions and political activists to push for passing a minimum wage ordinance reflects their
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complete loss of confidence in the existing distributional policy and institutions.
Obviously the chance of passing a minimum wage law in Hong Kong in the near future is
slim. The real purpose of this political move may be just to voice out grievances that the
workers?welfare is being sacrificed and exploited in the current recession. It could be argued
that one positive outcome of this recession is to demonstrate that the prevailing economic
policies of the government have achieved neither economic prosperity nor social stability.
Such long-term goals could not be achieved through piece-meal policies and temporary
measures. With the exchange rate crisis and economic recession still unfolding, it would be
more productive if workers could join hands with employers, especially of the small and
medium size enterprises, to push the government to conduct a critical and comprehensive
review of the prevailing policies, and to pursue policy reforms. Only through genuine review
and discussion, and with a holistic, balanced and long-term perspective, could proper lessons
be learnt from the recession.
Prof. Shu-hung Tang is a Professor in the Department of Economics, School of Business,
Hong Kong Baptist University.
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Although the data for mainland China is not available there is
data for Hong Kong and the shocking revelation is that the Hong
Kong economy seems to be in a long term recession unrelated to
the current international economy. The Hong Kong economy in
recent quarters went through a boom but this was followed by a
sharp downturn that probably was due to the current global
recession.
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Presentation
Hong-Kong
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Capital: Hong Kong
Local time:
It is 01:13 AM in Hong Kong
Exchange rate on 03/01/2010:
1 HKD = 0.1284 USD, 1 USD = 7.7879 HKD
1 HKD = 0.0892 EUR, 1 EUR = 11.2068 HKD
GDP growth rate: 0.5% in 2010
FDI stock: 1 184 471 million USD in 2007
Country risk:See the country risk analysis from Hong Kong provided by
Ducroire.
Economic freedom:
Score: 90/100
Position: free
http://www.ducroiredelcredere.co.uk/Webduk/WebSite.nsf/AllWeb/Hong+Kong+(China)?OpenDocument&Disp=1http://www.ducroiredelcredere.co.uk/Webduk/WebSite.nsf/AllWeb/Hong+Kong+(China)?OpenDocument&Disp=1http://www.ducroiredelcredere.co.uk/Webduk/WebSite.nsf/AllWeb/Hong+Kong+(China)?OpenDocument&Disp=1http://www.ducroiredelcredere.co.uk/Webduk/WebSite.nsf/AllWeb/Hong+Kong+(China)?OpenDocument&Disp=1http://www.ducroiredelcredere.co.uk/Webduk/WebSite.nsf/AllWeb/Hong+Kong+(China)?OpenDocument&Disp=1 -
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World Rank: 1 out of 179
Regional Rank: 1 out of 42
Distribution of Economic freedom in the world
Source: 2008 Index of Economic freedom, Heritage Foundation
Economic trends
GDP growth reached an average level of 5% during the period of 1989 to 2006. In
2008, the country was extremely affected by the financial crisis owing to its strong
dependence on foreign capital and the strong financialization of its economy. After
four years of maintained growth, the global financial crisis led the Hong Kong
economy into recession during the third quarter of 2008. The deterioration of the
foreign environment, which led to the decrease in Hong Kong's commercial trade,
caused a significant drop in domestic demand. From 2008, private consumption
dropped, a trend which should continue during the next three years. The price
indicator is expected to follow this downward trend. Economic growth had enabled
the noticeable improvement of the employment market. This market deteriorated
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considerably, especially financial services, and recovery is not expected before 2011.
Due to the strong decrease in global and domestic demand, the inflationary pressure
(4.3% in 2008) let up in 2009.
Main branches of industry
Since the agricultural sector is almost non-existent, Hong Kong has to import 80% of
its food supplies. Hong Kong does not have any natural resources and depends
entirely on imports of raw materials and power. Agriculture contributes practically
nothing to the economy.
The manufacturing Industry's contribution to the GDP is very low. The country's main
industrial sectors are textiles, clothing and electronic components.
The tertiary sector, particularly financial services, is the heart of economic activity and
contributes around 90% of the GDP. Hong Kong is a services center for Asian
companies, especially those that trade with China. Additionally, the tourism industry
is booming mainly, due to an exponential increase in the number of visitors from
mainland China.
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International trade
Hong Kong is amongst the world's first fifteen commercial services exporters and the
world's fifteen primary trade economies. Hong Kong's economy is considered as a
model of capitalism because of its dedication to free trade. Foreign trade was
pursued intensively during these past years. Maintained by the strength of trade with
China and the weakness of the dollar, export and import of goods grew by 10%.
However, a decrease in trade was noted in 2009 and Hong Kong's trade deficit
worsened. This trend should continue in 2010.
The island's main trade partners are China, Southeast Asia and Japan.
\
Labour market
The active population in figures| Working conditions | Cost of labor| Social partners
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The active population in figures
Main indicators
Labor force
Labor force (annual growth, %)
Rate of activity (%)
Unemployment rate (%)
Source: Statistics Department
http://www.censtatd.gov.hk/hong_kong_statistics/statistics_by_subject/index.jsp?subjectID=2&charsetID=1&displayMode=Thttp://www.emporikitrade.com/uk/countries-trading-profiles/hong-kong/labour-market#hauthttp://www.censtatd.gov.hk/hong_kong_statistics/statistics_by_subject/index.jsp?subjectID=2&charsetID=1&displayMode=T -
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Working conditions
Legal weekly duration
Between 40 and 48 hours
Retirement age
There is no legal age for retirement, but the average age is around 62 years.
Working contracts
The labor contract is mainly drawn-up by the law. It is completed by collective
negotiations and agreements.
The formalism of the labour contract, hiring conditions and lay-off constraints
are relatively flexible. CDI and the CDD are the two existing types of
contracts.
Cost of labor
Minimum wage
There is no legal minimum wage.
Average wage
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Average monthly gross earnings in Hong Kong is HKD 11.000 (USD 1.400)
Social contributions
Social security contributions paid by employers: 0 %.
Social security contributions paid by employees: 0%
Social partners
Social dialogue and involvement of social partners
Hong Kong Confederation of Trade Unions - (HKCTU) gathers several trade
unions. Their power remains very weak.
Unions
HKCTU
Hong Kong Federation of Trade Unions (HKFTU)
Labor regulation bodies
Labour Department
General Information
http://www.hkctu.org.hk/english/http://www.ftu.org.hk/http://www.info.gov.hk/labourhttp://www.emporikitrade.com/uk/countries-trading-profiles/hong-kong/labour-market#hauthttp://www.hkctu.org.hk/english/http://www.ftu.org.hk/http://www.info.gov.hk/labour -
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Political outline | Living conditions | Useful resources| Communications
Political outline
Executive Power
The territory is governed by a Chief Executive, elected for 5 years by a
college of 800 large voters including parliamentarians, eminent personalities
and representatives of the professional sectors. Mr.Donald Tsang was re-
elected as Chief Executive on 25 March 2007 with 81% votes of large
electors and a strong popular support (nearly 70% favorable opinions). For
the first time, this election was challenged by a candidate of the democtratic
camp Mr. Alan Leong, member of the Civil Party, a favorable sign of the effect
of democratic debate.
The government is responsible only to the Chief Executive and is composed
of 12 ministers (Secretaries) who are assisted by 17 senior functionaries who
hold the title of "Permanent Secretaries". In hierarchical order, the three main
government posts are the Chief Secretary- number 2 in the government, the
Financial Secretary, and the Secretary for Justice. If the Chief Executive is
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unable to conduct his functions temporarily, they will be conducted in this
order of precedence by the title holders of the main posts.
In addition, the Chief Executive is assisted by an Executive Council or Exco
which includes the government ministers and 15 non-official members who
are parliamentarians nominated by the Chief Executive; personalities from the
business world or from civil companies. The Exco serves as the Council of
Ministers by being the venue for formulation of government's policies. This
council is consulted for all important political decisions. It meets once a week,
under the chairmanship of the Chief Executive who should specially justify his
decisions in case of disagrement with the majority of its members.
Legislative Power
The Monocameral legislative power is conferred to a legislative council of 60
members whose appointment is confirmed through a complex poll procedure
which has three distinct colleges :
- 30 members are elected by univeral voting (proportional voting by
geographical district);
- 30 members are elected as part of the districts called "functional", which are
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professional colleges (teachers, banks, real-estate sector...) of very unequal
importance (from several thousands to a few tens).
The council votes for and amends laws and can also introduce any new
proposal. It examines and approves the budget, taxes and public expenditure,
appoints the judges for the Court of Final Appeal and the President of the
High Court. It can even question the responsibility of the Chief Executive and
raise questions to the government about the conduct of its policy, the absence
of political responsibility of the ministers can make the legislative council limit
the control exercised by this assembly on the executive power.
Their mandate is for four years. The government is directly or indirectly
dependent on parliament's support, which is often given through a vote of
confidence. The Chief Executive does not have the power to dissolve the
Parliament. He cannot refuse to sign a bill which has been voted in by 2/3
majority in the parliament. The politicial rights of Hong Kong citizens are very
limited and very elementary.
Main political parties
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Since there is no legislation on political parties in Hong Kong, there is no legal
definition of what is a political party. Most of the political parties or groups are
registered either companies or as Business Corporations. Hong Kong has a
multiparty system. There are several parties and one single party generally
does not have any chance to win power by controlling the Legislative Council.
The main political parties of the country are :
- TheADPL (Association for Democracy and People's livelihood), popular pro-
democracy party
- The Citizens Party, it supports matters regarding minorities and
environmental protection;
- DAB (Democratic Alliance for Betterment and Progress of Hong Kong),
conservative and pro-Beijing party;
- The Democratic Party, pro-democracy and liberal party ;
- TheFrontier Party, radical, pro-democracy, demands that Hong Kong should
have the right to draw-up its own constitution.
Current political leaders
Head of State : President of China - HU Jintao (since March 2003) - Chinese
Communist Party
Chief Executive : Donald TSANG (since June 2005) non-supporter
Next election dates
http://www.adpl.org.hk/http://www.adpl.org.hk/http://www.adpl.org.hk/http://www.citizensparty.org/http://www.dab.org.hk/en/index.jsphttp://www.dphk.org/http://www.frontier.org.hk/http://www.frontier.org.hk/http://www.frontier.org.hk/http://www.adpl.org.hk/http://www.citizensparty.org/http://www.dab.org.hk/en/index.jsphttp://www.dphk.org/http://www.frontier.org.hk/ -
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Legislative Council : in 2012
Why you should choose to invest Hong Kong
Strong points
Hong Kong is an international leader in terms of export and as a services
center. The country is also the bridgehead to one of the largest production
bases in the world, China. Hong Kong has a sound economy and an efficient
financial and banking system.
Favorable tax measures, the transparency of local institutions, political
stability, freedom of information, availability of qualified human resources as
well as its advantageous geographical location in Asia, all constitute to make
Hong-Kong a preferred place for company establishment, as witnessed by the
millions of companies registered on the territory.
Weak points
Hong Kong has few, yet consequential, negative points against setting up:
- High cost of real estate and work space (offices, shops,etc.);
- High cost of salaries, compared to other Asian countries such as Mainland
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China and India;
- The question of Hong Kong's future, especially when the town will be
completely integrated with the People's Republic of China;
- The excessive importance of the financial sector.
Furthermore, on the whole of the 2008-2009 year, the Hong Kong stock
market was highly disturbed. The stock market's main indicator fell by 45%,
the lowest in 34 years.
Government measures to motivate or restrict FDI
Hong Kong is a free territory for investments, which are in fact encouraged by
the government with a favorable taxation policy and light legislation. Foreign
companies can be set up freely, register their brands and the Director of the
company doesn't have to be a citizen nor resident of Hong Kong.
Bilateral investment conventions signed by Hong Kong
Hong Kong has signed bilateral agreements for investments with 15
countries.
To see the list of countries, click here.
To see the agreements, click here.
culture
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The territory's population reached more than 7 million in 2007. Hong Kong
has a fertility rate of 0.95 children per woman, one of the lowest in the
world and far below the 2.1 children per woman required to sustain the
current population. However, the population in Hong Kong continues to
grow due to the influx of immigrants from mainland China, approximating
45,000 per year there exists a daily quota of 150 people from Mainland
China with family ties in Hong Kong are granted a 'one way permit'.
According to a United Nation report, Life expectancy in Hong Kong is 81.8
years as of 2006, the second highest in the world.
Hong Kong is frequently described as a place where East meets west,
reflecting the culture's mix of the territory's Chinese roots with the culture
brought to it during its time as a British colony/territory. Although over a
decade has passed since the handover, Western cultural practices remain,
and coexist with the traditional philosophy and practices of Chinese
culture.
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8/14/2019 ANALYSIS by Vaudine England, BBC News, Hong
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According to Emporis, there are 7,650 skyscrapers in Hong Kong, putting
the city at the top of world rankings. The high density and tall skyline of
Hong Kong's urban area is due to a lack of available sprawl space, with the
average distance from the harbour front to the steep hills of Hong Kong
Island at 1.3 km (0.8 mi), much of it reclaimed land. This lack of space
causing demand for dense, high-rise offices and housing has resulted in 36
of the world's 100 tallest residential buildings being in Hong Kong, and
more people living or working above the 14th floor than anywhere else on
Earth, making it the world's most vertical city.