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Hong Kong Hong Kong

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Hong Kong

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EconomicPoliticalStructural

Hong Kong – Quick View
ECR score84.84 (Mar 2011)
ECR rank12 (Mar 2011)
Economic
GDP (2010)USD 210,086.58 million
GNI per capita PPP (2008)USD 44,340
FDI inflow (2009)USD 48.4 billion
Inflation (2009)0.55%
Central bank assets (2010)USD 301,816.15 million
Unemployment rate (2010)4.4%
Government surplus (2009-2010)USD 10,471.26 million
Tax revenue (2009-2010)USD 26,803.54 million
Political
Government typeLimited Democracy
Recent political crisisNA
Economic freedom score (2011)1st
Freedom of information score (2010)34th
Corruption perception index (2010)13th
Structural
Birth rate (2009)11.7 per '000
Population balance (mid-2010)Under 14 years - 12.14%
Population balance (mid-2010)Above 60 years - 18.18%
Life expectancy years (2009)Male - 79.8 years
Life expectancy years (2009)Female - 86.1 years
Mortality rate (2009)5.9 per '000
Literacy rate (2009)94.6%
Internet access (2010)69.2%

[Top] Economic Overview

Gross Domestic Product (GDP)

 

In 2010, the preliminary GDP of Hong Kong was HKD 1,748,090 million, growing 7.8% from 2009.

 

(Source: CSD)

 

Hong Kong GDP and growth rate

(Source: CSD)

 

Gross National Income (GNI)

 

In 2010, GNI per capita at PPP was USD 45,090, compared to USD 38,675 in 2005.

 

Hong Kong GNI per capita

(Source:UNDP )

 

Income tax rate

 

Income tax rates for an individual vary from 2% to 17% based on the income slabs.

 

Following are the income tax rates and the corresponding income levels:

 

Income tax rates

Individual Income (HKD)

Rate (%)

1 – 40,000

2

40,001 – 80,000

7

80,001 – 1,20,000

12

1,20,000 and above

17

 

(Source: Gov.hk)

 

Inflation rate

 

In 2009, the government of Hong Kong introduced temporary waivers and subsidies in electricity services, decreasing the inflation rate to 0.55%. In 1991, the country recorded its highest inflation rate, 11.26%.

 

Hong Kong inflation rate

(Source: World Bank)

 

Foreign Direct Investment (FDI)

 

In foreign investment inflows, the country is ranked 4th by the United Nations. FDI inflow stood at USD 48.4 billion in 2009, decreasing 19% compared to 2008.

 

(Source: China Business News)

 

Central bank assets

 

Central Bank Assets as at 31st December (HKD million)

Assets

2010

2009

Cash and money at call

48,911

17,658

Placements with banks and other financial institutions

149,478

108,636

Derivative financial instruments

1,902

4,247

Financial assets designated at fair value

2,104,562

1,995,464

Available-for-sale securities

493

493

Gold

732

572

Other assets

18,770

14,007

Investments in subsidiaries

16,828

4,947

Property, plant and equipment

3,308

3,374

Total Assets

2,344,984

2,149,398

 

(Source: HKMA)

[Top] Financial Indicators & Government Financial

Consumer Price Index (CPI)

 

The country reported composite CPI was 114.4 in December 2010.

 

The following table shows CPI during 2009 and 2010:

 

Month

CPI

2009

December

114.4

November

113.8

October

113.3

September

110.9

August

110.6

July

110.7

June

112.2

May

112.0

April

112.2

March

111.7

February

112.2

January

111.1

2010

December

111.0

November

110.6

October

110.5

September

108.2

 

(Source: CSD)

 

Interest rates

 

Interest rates for both time and saving deposits showed a decline of CAGR 49.23% from 2000 to 2009.

 

Hong Kong interest rate

(Source: CSD)

 

Money supply

 

Hong Kong has a 3-level money supply arrangement: M1, M2 and M3.

 

M1 includes the total legal notes & coins and demand deposits with licensed banks.

M2 is the total of M1, savings and time deposits with licensed banks and bank-issued negotiable certificates of deposits (NCDs) to the non-authorized institutions.

M3 includes M2, customer deposits and NCDs with the restricted licence banks and deposit-taking companies.

 

Month

M1

M2

M3

2010 (Till Q3)

1,075,764

6,989,183

7,010,353

2009

901,819

6,602,310

6,626,843

2008

645,833

6,268,058

6,300,751

2007

616,709

6,106,348

6,139,758

2006

491,648

5,054,332

5,089,741

2005

434,684

4,379,057

4,407,188

2004

484,494

4,166,706

4,189,544

2003

413,423

3,813,442

3,858,044

2002

295,650

3,518,326

3,561,852

2001

258,056

3,550,060

3,594,130

 

(Source: CSD)

 

Currency in circulation

 

Total currency in circulation (notes and coins), was reported at HKD 214,666 million in 2010 (till Q3).

 

Hong Kong currency in circulation

(Source: CSD)

 

Government expenditure

 

In 2010, total Government expenditure was accounted at HKD 237,295 million, decreasing 9.01% over 2009.

                                                                                                                           

(Source: CSD)

 

Official exchange rate

 

The official exchange rate for HKD in 2010 was 7.78 for US Dollars (USD) and 10.40 for Euro (EUR).

 

(Source: CSD)

 

The average exchange rates (yearly) of HKD from 2001 to 2010 were:

 

Year

USD

EUR

2010

7.78

10.40

2009

7.75

10.82

2008

7.79

11.45

2007

7.80

10.70

2006

7.77

9.77

2005

7.78

9.68

2004

7.79

9.69

2003

7.79

8.81

2002

7.80

7.38

2001

7.80

6.99

 

(Source: CSD)

 

Government finances

 

Fiscal balance

 

During 2009-2010 year, the general government account reported a fiscal surplus of HKD 21,364 million.

 

Hong Kong fiscal balance

p=preliminary

 

(Source: CSD)

 

Total revenue

 

The government recorded a revenue of HKD 318,442 million during the 2009-2010 year, which includes total operating revenue of HKD 262,860 million and total capital revenue of HKD 55,582 million.

 

(Source: CSD)

 

Hong Kong sources of revenue

(Source: CSD)

 

Hong Kong government revenue

(Source: CSD)

 

Tax revenue

 

Total revenue from taxes was recorded at HKD 207,865 million in 2010, reflecting a decline of 4.83% from 2009.

 

Hong Kong tax revenue

(Source: CSD)

 

Current account balance

 

In 2010, the preliminary current account balance of Hong Kong was recorded at HKD 114,980 million.

 

Hong Kong current account balance

p=preliminary

(Source: CSD)

 

Balance of payments

 

In 2010, the preliminary overall balance of payments was registered at HKD 71,086 million and the current account balance for the same period is recorded at HKD 114,980 million.

 

Balance of Payments

Year

Current Account Balance

Net Change in Financial Non-reserve Assets

Overall Balance of Payments

(HKD million)

As a Ratio to GDP (%)

(HKD million)

As a Ratio to GDP (%)

(HKD million)

As a Ratio to GDP (%)

2010p

114,980

6.6

-106,971

-6.1

71,086

4.1

2009

135,027

8.3

357,680

21.9

549,262

33.6

2008

228,125

13.6

16,314

1.0

263,869

15.8

2007

199,160

12.3

-155,086

-9.6

114,498

7.1

2006

178,166

12.1

-160,300

-10.9

46,735

3.2

p=preliminary

(Source: CSD)

[Top] Labour Force and Employment Overview

Hong Kong employs a total labour force of around 3,700,000 people as of December 2010, increasing 1.3% from the previous year.

 

(Source: CSD)

 

Labour participation rate (LPR) till October 2010 was 68.9% amongst males and 52.2% among females. 

 

(Source: CSD)

 

Unemployment rate

 

Hong Kong had registered a decline in the unemployment rate from 2003 to 2008. However, due to the global recession it increased in 2009, but it further decreased in 2010.

 

(Source: CSD)

 

Wage structure

 

The average monthly wage rate for employees (up to the Supervisory Level) under all sectors was HKD 11,688 as of June 2010. 

 

 

Average Monthly Wage Rate for different industries (HKD)

Industry

2010

2009

Jun

Mar

Dec

Sep

Jun

Mar

Finance and Insurance

17,519

17,672

17,305

16,936

17,022

16,527

Transportation

14,848

14,702

14,642

14,897

14,679

14,510

Import/Export, Wholesale and Retail

14,232

13,839

14,007

13,917

14,069

13,866

Personal services

12,011

11,932

11,539

11,387

11,593

11,626

Manufacturing

9,299

9,329

8,900

9,373

9,664

9,924

Food & Accommodation

9,266

9,160

8,994

9,007

8,827

8,824

Real estate leasing and maintenance

9,074

8,950

8,907

8,868

8,845

8,839

Professional and business services

7,499

7,415

7,329

7,053

6,951

6,950

 

(Source: CSD)

 

On an average, every male employee works for 48 hours/week and every female employee for 45 hours/week in all industries. Working hours are highest in the retail, food and accommodation industries, where every male employee works an average for 54 hours/week and every female employee works for 50 hours/week.

 

(Source: CSD)

[Top] Political Stability

Hong Kong is an autonomous administrative region of China. Under Hong Kong’s basic law, the country wholly governs defence and foreign affairs.  However, the other sectors are influenced by Chinese administration. This law was adopted on April 4, 1990, but has been in effect from July 1, 1997.

 

The Government is led by the Chief Executive and the Executive Council. The Chief Executive administers: the implementation of the basic law, decision making on policies, signing bills and budgets, and issuing executive orders. Whereas, the Executive Council looks after matters related to policies, introduction of bills to the Legislative Council and drafting of sub-ordinate legislation. The council is comprised of 15 principal officials and 14 non-official members, appointed by Chief Executive.

 

Government structure includes both Legislative and District councils. The Legislative council is responsible for governing and law enforcement.  The council is comprised of 60 members, of which 30 are directly elected by geographical constituencies and the remaining 30 are elected through functional constituencies. The 18 District councils throughout the nation have a total of 102 appointed and 405 elected members. These councils promote recreational, cultural and community activities.

 

(Source: Gov.hk)

 

Regulatory environment

 

Hong Kong is ranked 1st on the 2011 Index of Economic Freedom, with an economic freedom score of 89.7 (out of 100), which has remained unchanged from the previous year.

 

(Source: Heritage.org)

 

(Source: Heritage.org)

 

Corruption perception

 

Hong Kong is ranked 13th on the World’s Corruption Perception Index 2010. Its score is 8.4 (out of 10), making it one of the least corrupt countries in the world.

 

(Source: transperancy.org)

 

Freedom of information

 

Hong Kong is ranked 34th on the Press Freedom Index of 2010.

 

(Source: Rsf.org)

 

Judicial system


The judicial system is an independent division of the Government. It consists of:

 

  • Court of Final Appeal: the highest appellate court
  • Court of Appeal: hears appeals from the Court of First Instance, the District Court, Lands Tribunal and other statutory bodies, on all civil and criminal matters
  • Court of First Instance: hears appeals from Magistrates' Courts, Small Claims Tribunal, Obscene Articles Tribunal, Labour Tribunal and also fromthe  Minor Employment Claims Adjudication Board on civil and criminal matters
  • District Court:hears civil disputes covering values from HKD 50,000 to HKD 1,000,000. It power to imprison is limited to 7 years
  • Family Court: hears appeals on family matters such as welfare of children and divorce cases.
  • Magistrates' Courts: hears cases of indictable and summary offences. It has the power to imprison for a period up to 3 years and fine not more than HKD 5,000,000. There are 7 such courts in Hong Kong
  • Lands Tribunal: hears appeals and disputes related to lands and buildings
  • Labour Tribunal:handles labour disputes where either the claim is of a value above HKD 8,000 or there are more than 10 claimants for the case.
  • Small Claims Tribunal:hears appeals on civil matters, not exceeding value of HKD 50,000.
  • Obscene Articles Tribunal: makes decisions on obscenity or indecency of any publicly displayed article.
  • Coroner's Court: investigates deaths.
  • Juvenile Court:hears charges against people below 16 years of age. Furthermore, it also issues care and protection orders for people up to age of 18.  

(Source: Hong Kong Judiciary)

[Top] Demographic Overview

In mid-2010, the population of Hong Kong was 7,067,800, increasing 0.9%from mid-2009. Specifically, females constitute to 53.16% of the entire population.

 

(Source: CSD)

 

(Source: CSD)

 

The average population density is about 6,480 people per sq km. Kwun Tong is most densely populated district of the country, with approximately 53,110 people per sq km. 

 

(Source: CSD,)

 

Between 2005 and 2010, the population of the country witnessed a stable growth rate. 

 

Population statistics (mid-year)

Year

Population

Annual Rate of Increase (%)

Gender Ratio (males per 1,000 females)

2010

7,067,800

0.9

881

2009

7,003,700

0.4

889

2008

6,977,700

0.7

896

2007

6,925,900

1.0

904

2006

6,857,100

0.6

912

2005

6,813,200

0.4

920

 

(Source: CSD)

 

In mid-2010, the majority of the population, about 44.36%, were between 15 and 44 years old and about 43.50% population were over 45.

 

Age and gender classification of population (mid-2010)

Age Group

Males

Females

Total

0-14

443,700

414,300

858,000

15-24

444,300

446,700

891,000

25-34

455,300

629,900

1,085,200

35-44

492,300

666,800

1,159,100

45-54

619,900

678,000

1,297,900

55-64

432,300

432,200

865,000

65 and above

422,700

489,400

912,000

Total

3,310,500

3,757,300

7,067,800

 

(Source: CSD)

 

Birth and death rate

 

The crude birth rate during 2009 was 11.7 live births per 1,000 people, compared to 8.4 live births in 2005, making an increase of 8.64%.

 

(Source: Hong Kong factsheets)

 

In 2009, the death rate was 5.9 deaths per 1,000 people. Recently improved maternal and child health services realized a decrease in infant mortality rate.

 

(Source: Hong Kong factsheets)

 

(Source: Hong Kong factsheets)

 

Life expectancy

 

In 2009, the average life expectancy at birth was 79.8 years for males and 86.1 for females.

 

(Source: Department of Health and Hong Kong factsheets)

 

Infant mortality rate

 

In 2009, the country registered an infant mortality rate of 1.7 deaths per 1,000 live births.

 

(Source: Department of Health and Hong Kong factsheets)

 

Immigration

 

Population in Hong Kong includes foreigners from Indonesia – 147,883 (2.11%), Philippines – 140,708 (2.01%) and Thailand – 28,049 (0.40%).

 

(Source: Department of Health  and Hong Kong factsheets)

 

Human Development Index (HDI)

 

The country is ranked 21st on the HDI 2010, which is based on factors such as life expectancy at birth, mean and expected years of schooling, and gross national per capita income.

 

(Source: HDR UNDP)

[Top] Soft Infrastructure

Literacy rate

 

By 2009: 5.3% people in the working age group (15 and above) were either uneducated or had attained only pre-primary education; 17% people completed primary education, 52.2% received secondary education and 25.4% achieved post-secondary education.

                                                   

(Source: Gov.hk)

 

Education

 

In the academic year 2010-2011, there are 2,116 schools in Hong Kong and 61,354 teachers employed across all levels of education.

 

(Source: Education Bureau)

 

 

Education facilities for the academic year 2010-2011

Facilities

Education type

Kindergarten

Primary

Secondary

Special

No. of schools

950

582

523

61

Student enrolment

140,502

344,748

469,466

8,026

No. of teachers

10,063

20,135

29,710

1,446

Pupil-Teacher ratio

9.6:1

15.7:1

16.0:1

5.6:1

 

(Source: Education Bureau)

 

Healthcare

 

Hong Kong has a well established healthcare system, with 12,424 doctors, 2,126 dentists, and 38,641 nurses. Furthermore, the government’s department of health consists of 5,400 civil servants.

 

(Source: Department of Health)

 

Healthcare facilities (2009)

Facilities

Number

Hospitals under Hospital Authority

38

Private Hospitals

13