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Promoting a more balanced and inclusive economic development

Hong Kong’s employment market has seen a further improvement. The latest unemployment rate announced last week has declined 0.2 percentage point from 4.7% of the previous period to 4.5% (July to September), which is the lowest point over the past one and a half year. Since this year, the rate has already receded nearly 3 percentage points in total. Nonetheless, the decreasing momentum of the rate has been slowing down in recent months, indicating a weakened driving force of Hong Kong’s economic recovery. For the group aged 15 to 24, although its unemployment rate has receded from the peak of 20.3% in last year, it still stays at the level of 15%, which is much higher than the overall level. When I attended a seminar at the Hong Kong Metropolitan University last week, the students there also shared with me their views on Hong Kong’s prospect and their career aspiration.

I attended a seminar at the Hong Kong Metropolitan University last week and had exchanges with the students.

Despite our continuous economic development, Hong Kong’s pattern of industries and employment have led to our unbalanced economic structure. Over past two decades, the financial service sector has taken up a much more important proportion in our GDP, which has surged from 12.8% to 21%. However, its contribution to the share of our employment only grew from 5.3% to 7.1%, accounting for about 270 000 employed persons. For the trade and logistics sector, the portion it took up of the GDP has dropped from 23.6% to less than 20% over the same period, and its share of the job market declined from 23.8% to 17.5%, but still employing over 670 000 people. For the tourism sector, although it only accounted for 4.5% of our GDP just before the outbreak of the pandemic, it employed 6.6% of our workforce, i.e. about 260 000 people. Under this employment structure, even the financial services sector has enjoyed a robust development, which may also stimulate the demand on our retail, catering, tourism and transport sectors, employees of different sectors are still having an unbalanced share of the fruit of economic development.

On the other hand, the value of assets of different places around the world has kept surging in recent years due to the excessive free capital brought by the quantitative easing policy implemented by many western countries. In Hong Kong’s case, coupled with our long-time shortage of land supply, the price of flats has already far exceeded the affordability of most of our citizens, leading to a high living cost which takes away a big slice of the wages hardly earned by the breadwinners and undermines their actual purchasing power.

To a certain extent, our economic structure has led to a seriously uneven distribution of the fruit of the economic development, and worsen the income and wealth disparity. The growth of people’s income can hardly catch up with the surge in living costs. This becomes the major dilemma of our society, which greatly undermines people’s sense of achievement and satisfaction, and even their sense of belonging to the society.

What are our aspirations for the life living in Hong Kong? Different generations may have different wishes, from more playing spaces, a more diversified platform for career development, to more comfortable living environment and a caring society for the elderly. How should we plan the development of Hong Kong in order to fulfil the different needs of our citizens?

If we see the development of Hong Kong as a robustly growing Banyan tree, what it needs is the participation of all of us to make it grow stronger.

A stable environment is the foundation for development and prosperity, just like the roots of the tree. The “One Country, Two Systems” principle has to be fully implemented and Hong Kong needs to firmly grasp the opportunities brought by the development of our Country. The “One Country, Two Systems” principle is one of the fourteen basic governance principles of the Chinese Communist Party, which is not only a special arrangement for the unification of the Country, but also an institutional strength of our Country. With the governance of Hong Kong being part of the national governance system, we have to fully and comprehensively understand the relations between the Constitution and the Basic Law, the national strategy and plan of economic development and rightly position ourselves. By doing so, we could better take up our roles in the development of our Country, the Guangdong-Hong Kong-Macao Greater Bay Area (GBA), and have a better cooperation with other brother cities in the GBA. We have to perform our strengths to serve the needs of the Country, which is also what Hong Kong needs indeed for its further development.

Our traditional pillar industries, such as financial services, are just like the main trunk of the tree, which we need to make it further stronger. Similar to those freshly grown prop roots which need to anchor to the ground for better development, our emerging industries, such as innovation and technology, also need to connect with the production factors and the market of the Mainland for a robust and speedy growth.

By leveraging the demands and opportunities of the Mainland and the GBA in particular, with our own strengths and the effort of the Government, other sectors of Hong Kong, such as professional services, real estate, catering, retail, art, cultural and performance activities would enjoy a broader space for development. This will create more jobs and opportunities of better career prospect for our citizens, especially our young people. After the implementation of the Hong Kong National Security Law and the enhancement of the electoral system, the executive-led system is back on track and the development of Hong Kong under the new phase will be expedited to show a new landscape.

No matter how the economic development flourishes, the most important thing is that the mass public could share the benefits and the fruit of the economic development to a greater extent. The interests of the people should always be put at the centre of any economic and social development. There are two crucial factors in achieving this goal. First, we have to create an environment conducive to robust economic development and promote the diversified development of our industry, so as to provide more high quality jobs and increase people’s income. Second, we have to substantially increase the supply of land and housing, with a view to realising the ownership-led policy objective so that people can have a decent living environment with a more affordable living cost. By fighting hard along these two directions, we could gradually improve people’s living and make Hong Kong a better living place for all.

October 24, 2021