Hong Kong Chief Executive Delivers 2009-10 Policy Address

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October 14, 2009 - Delivering his 2009-10 Policy Address to the Legislative Council, Chief Executive Donald Tsang today set out strategies for Hong Kong to break new ground in economic development and sustainable growth.

Mr. Tsang said the global economic crisis had underscored the need for Hong Kong to diversify its economic base in areas that complemented the traditional pillar industries of financial services, tourism, trade and logistics and professionals services.

He announced new initiatives to develop six industries where Hong Kong enjoyed clear advantages: education services, medical services, testing and certification services, environmental industries, innovation and technology, and cultural and creative industries.

"With appropriate policies to remove obstacles to their development, the six industries will enter a new phase of development, propelling Hong Kong towards a knowledge-based economy," Mr. Tsang said.

To support the development of the six industries, the government proposes optimizing land use by releasing the potential of over 1,000 older industrial buildings through policies that encourage the redevelopment or conversion of the buildings.

Specific initiatives are as follows:

Education Services
Four greenfield sites have been allocated for international school development while two sites have been reserved for operators providing self-financing degree programs.

Medical Services
Four sites have been reserved for private hospital development.

Testing and Certification Services
The Hong Kong Council for Testing and Certification will draw up a three-year development plan for the industry, including promoting the development of Chinese medicine.

Environmental Industries
Working toward the goal of improving air quality and reducing carbon emissions, the government has committed to reducing the energy intensity of Hong Kong by at least 25 percent by 2030, compared to 2005 levels. To help achieve this goal, Mr. Tsang said the government would continue to focus on promoting the use of cleaner fuel and improved energy efficiency.

In addition, the government would expand its green procurement list and actively apply green specifications in procurement procedures.

Innovation and Technology
Allocate about US$25.6 million to launch an R&D cash rebate initiative to encourage enterprises to invest in research and development and forge partnerships with research institutions.

Cultural and Creative Industries
Support local cultural and creative industries to further develop the Mainland of China market through the Closer Economic Partnership Arrangement (CEPA), Hong Kong’s free trade agreement with the Mainland of China.

Mr. Tsang identified several new challenges for Hong Kong including promoting stronger regional cooperation and maintaining Hong Kong’s status as a global financial center. He said Hong Kong should collaborate with Shanghai in developing the country’s financial services industry, adding that competition between the two cities was not a “zero-sum game.”

“As a prime global financial center in the Asian time zone, Hong Kong enjoys many advantages, including a highly open and internationalized market, a regulatory regime aligned with major overseas markets, the rule of law, and the free flow of information and capital,” Mr. Tsang said.

On democratic reform, Mr. Tsang said that next month the Hong Kong government would begin an extensive public consultation on amending the electoral methods for electing the Chief Executive and forming the Legislative Council in 2012 with a view to further democratize the election systems.

The moves would pave the way for the election of the Chief Executive in 2017 and the formation of the Legislative Council in 2020 by universal suffrage.

2009-2010 Policy Address: http://www.policyaddress.gov.hk