Wednesday, October 13, 2010

HK economy to grow by 5-6%

Hong Kong Chief Executive Donald Tsang holds his policy address in the Legislative Council in Hong Kong. -- PHOTO: AP

HONG KONG - HONG Kong's leader said on Wednesday the southern Chinese financial hub's economy is expected to grow 5 to 6 per cent this year as it completes its recovery from the global financial crisis.

Donald Tsang said in his annual policy speech that the Hong Kong economy expanded by 7.2 per cent in the first half, lifted by exports and local demand, and that the latest unemployment rate is 4.2 per cent - the lowest since January 2009.

But the Hong Kong chief executive warned that the exports- and services-driven economy was still vulnerable to external shocks.

'We need to guard against greater downside risks in the global economy and increased risks of asset-price bubbles in Asia resulting from the fragile recovery of the US economy and the lingering sovereign debt crisis in Europe,' Mr Tsang told legislators.

Mr Tsang also said he will tackle the city's rich-poor gap - one of the worst in the developed world - and expensive property prices.

This wealthy city of 7 million is home to some of the priciest real estate in the world. The leader said his administration will set up a 10 billion Hong Kong dollar (S$1.7 billion) 'Community Care Fund' to provide assistance in areas not covered by the existing welfare system. -- AP

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