Hong Kong Special Administrative Region (HKSAR) Chief Executive Donald Tsang set new goals for the coming years in his first Policy Address since reelection, stating that promoting economic development remains the HKSAR government's primary goal.

In his annual televised address titled "A New Direction for Hong Kong" at the Legislative Council on Wednesday morning, Tsang said that he was confident because Hong Kong's economy is back on track, registering rapid growth over the past 15 quarters.

Tsang said Hong Kong has seen an average annual growth of 7.7 percent from 2004 to 2006 with the first half of 2007 seeing further growth of 6.3 percent. He pledged to pay close attention to the implications of inflation on the livelihood of the low-income group.

Tsang said the goals, including sustainable, balanced and diversified development together with social harmony, will ultimately lead Hong Kong to become China's most advanced and harmonious city, as well as a global metropolis offering a high quality of life.

To realize those goals, Tsang proposed plans to promote economic development through infrastructure projects and to push ahead with 10 major infrastructure projects aimed at creating new employment opportunities and increasing wages.

Tsang said the HKSAR government's efforts in promoting infrastructure development over the past decade did not match expectations as overall infrastructure expenditures for this year may well be the lowest in recent years.

The 10 large-scale infrastructure projects Tsang plans to push within his term of office cover transportation, cross-boundary integration and new urban development areas.

According to the HKSAR government's rough estimate, the proposed projects would bring in more than 100 billion HK dollars (US$12.82 billion) annually of added value to Hong Kong's economy and create some 250,000 additional jobs.

In his policy address, Tsang said in parallel with those 10 major infrastructure projects, the HKSAR government will reinforce Hong Kong's position as a global financial center through building a consolidated and diversified financial market.

Tsang said Hong Kong will actively facilitate Chinese mainland enterprises and investors to participate in Hong Kong's stock market through the Qualified Domestic Institutional Investors (QDII) scheme.

While strengthening the financial market linkage and interaction between Hong Kong and the Chinese mainland, Tsang said, the HKSAR government will step up efforts in developing an Islamic bond market in Hong Kong.

"To further consolidate Hong Kong's position as a global financial center, we should actively leverage on this new trend by developing an Islamic financial platform in Hong Kong," Tsang said.

According to Tsang's plan, apart from stepping up our efforts to promote Hong Kong's financial services to major Islamic countries and regions, we will focus on developing an Islamic bond market.

The Hong Kong Monetary Authority, in conjunction with the financial sector, has set up a dedicated team to study related issues and make recommendations for the early introduction of Islamic debt offerings in Hong Kong.

Tsang said the HKSAR government has endeavored to develop Hong Kong into an arbitration center in the Asia-Pacific region since a sound judicial system and comprehensive legal services for dispute resolution are indispensable for an international financial center.

In his Policy Address, Tsang also elaborated on plans concerning cooperation with the Chinese mainland, assistance to Hong Kong's small and medium-sized enterprises in the Chinese mainland.  

Tsang also delivered his tax relief promises during his reelection campaigning, announcing a tax reduction and rates waiving package worth 7.6 billion HK dollars (US$1 billion).

According to the package, the standard rate of salaries tax will be lowered to 15 percent in 2008-09 fiscal year and the profits tax will be cut by one percentage point to 16.5 percent in 2008-09.

Tsang also announced to extend the government's assistance to low-income citizens, saying poverty alleviation remains the HKSAR government's priority in the next five years, offering 12-year free education starting from the 2008-09 school year. Hong Kong has been providing nine-year free education through public primary and secondary schools.

He urged enterprises to look beyond their economic role in society and shoulder social responsibility in areas such as wage protection, environmental protection, heritage conservation and building a caring society.

"For these strategies to succeed, the HKSAR government, enterprises and individual citizens must each play their part," Tsang said.

"When people from different social strata and age groups, and people of different political views, all strive for progress and advancement, we will embark upon a new journey for a golden decade."

(Xinhua News Agency October 10, 2007)