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Hong Kong

Of course, during the process of economic recovery, Hong Kong's economy still faces enormous challenges. The best demonstration is the fluctuation of the world economy in 2000. For instance, beginning from March, the U.S. stock market dipped several times, which caused Hong Kong's Hang Seng Index to fall from a level of more than 18,000 points at the beginning of the year to below 15,000. As a result of the frequent increase of US dollar interest rates, the real interest rates of the HK dollar under the pegged exchange rate system rose to the highest point in nearly 20 years, which aggravated the already sluggish real estate market and difficulties of small and medium-sized businesses. The soaring oil price in the world in the latter half of the year also affected trade and consumption in Hong Kong to some extent. Despite all these unfavorable conditions, however, the region's economy managed to maintain enviable vitality amid fierce international competition thanks to sound economic foundations and business environment, a complete legal system and a highly efficient and orderly management system. In particular, the booming mainland economy and the hard work of people in all walks of life in Hong Kong played a crucially important role.

In addition, since the return of Hong Kong, the SAR has enjoyed a high degree of autonomy in accordance with the Basic Law. It enjoys administrative power, legislative power, independent judicial power and the power of final adjudication. The rights and freedom of residents in the HKSAR have been practically protected. The foundation for the rule of law in Hong Kong has further consolidated.

At the return of Hong Kong, some people had worried that the freedom it enjoyed might be reduced. More than three years have passed and there is sufficient evidence that the society of Hong Kong has undergone no material change. The media still feature the "contention of one hundred schools of thought". Maintaining its high degree of press freedom and information freedom, Hong Kong continues to be a major international media and communications center in Asia. To properly handle problems resulting from the verdict related to the "right of abode in Hong Kong", the SAR government, with the authorization by the Basic Law, submitted a motion to the State Council requiring the NPC Standing Committee to interpret the Basic Law. The move has avoided the flooding of more than 1 million people to Hong Kong and thus maintained the new constitutional government of the SAR under the Basic Law.

Hong Kong governed on the principle of "one country, two systems" enjoys a much higher degree of legal autonomy than under colonial rule. The SAR can legislate on almost all matters within the range of its autonomy. It also enjoys a high degree of autonomy in administrative aspects. The SAR government has independently solved many new problems emerging from practice in accordance with the law. They include the status of the temporary Legislative Council, modification plan for legal adaptability, criminal and judicial jurisdiction of mainland courts over cross-border activities, right of abode and protection of the national flag and regional flag. Judges in the SAR, including local Chinese and non-Chinese personages, continue to enjoy high independence in exercising the rule of law. Either as a plaintiff or as a defendant, the government sometimes wins lawsuits and sometimes loses, which fully displays the independent nature of the Hong Kong judiciary. After the return, the Common Law that has been practiced in Hong Kong for a century has been better protected under the Basic Law.

In 2001, although it is hard to achieve the high rate of growth seen in 2000, Hong Kong can still maintain a certain growth rate. Donald Tsang, former financial secretary of the HKSAR government, predicted that Hong Kong might keep its economic growth at a rate of 4-5 percent in 2001. Financial circles also believe that Hong Kong's economy will maintain stability.

It is believed that the industries with slower recovery, such as retail, construction and real estate, will improve in 2001. The unemployment rate is expected to drop from 4.7 percent to 4 percent. Securities circles are generally optimistic about the stock market and some foreign securities institutions in Hong Kong have raised their rating of Hong Kong stocks. So long as the U.S. economy does not experience a major slump, insiders say that the Hong Kong stock market may hit 20,000 points in 2001.

People from the business community are especially excited about the new opportunities for Hong Kong due to China's forthcoming WTO accession. Driven by the country's WTO entry, Hong Kong will launch its third economic leap. According to Peter Woo, Chairman of the Hong Kong Trade Development Council, the third leap will have more far-reaching significance than the previous two, which will gain more room for the development of both Hong Kong and the mainland.

Donald Tsang, now Chief Secretary for Administration of the SAR government, declared: "It may be said that the year 2001 is full of opportunities and challenges. I firmly believe that with the effort of the government and the astuteness and adaptability of the business community, Hong Kong will definitely make the best use of the opportunities and boost the economy together with the entire country's further opening and prosperity."

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