Boosting economic development, strengthening support for families and intensifing efforts to protect the environment will top the Hong Kong Special Administrative Region (SAR) Government’s policy agenda in the next year, the Chief Executive, Mr. Donald Tsang, announced in his Policy Address in October.

Delivering his second Policy Address, entitled ‘Proactive, Pragmatic, Always People First’, Mr. Tsang also promised to lead open and inclusive discussions on a roadmap for the further development of a democratic political system in Hong Kong.

On the economic front, Mr. Tsang unveiled initiatives to boost financial services, trade and logistics, information technology, cultural and creative industries, the performing arts and labor rights protection.

To better support families, the Chief Executive announced plans to help parents pay for pre-school education, assist kindergartens upgrade equipment and resources, enhance services for victims of domestic violence and to increase services and facilities in districts where development gaps existed.

On the environment front, Mr. Tsang pledged to provide financial incentives to phase out older diesel vehicles, reduce registration tax for low-emission vehicles, review air quality objectives, to launch a trial scheme on waste charging, and to introduce a Product Eco-responsibility Bill to control waste at source.

The Chief Executive said Hong Kong needed to consolidate its position as an international financial center in Asia, which was in line with the interests of both the country and the region.

He said further liberalization was needed to broaden the source of well-qualified foreign enterprises seeking to list in Hong Kong and urged amendments to listing rules to make this happen.

Mr. Tsang said the State Council was actively pursuing the expansion of Renminbi (RMB) business in Hong Kong, including the settlement in RMB of direct imports from the Mainland and the issuance of RMB financial bonds.

To boost the trade and logistics sectors, the Government would seek to enter into more economic and trade arrangements with trading partners to enhance overseas market access for Hong Kong’s goods and services.

To enhance efficiency, streamline application procedures and lower permit fees, the law will be changed to allow multiple entry permits for the river trade vessels that ferry large volumes of cargo from within the Pearl River Delta to Hong Kong’s port.

The Government had been working with the Dongguan authorities to increase the efficiency of cross-boundary cargo flows, with agreement reached on the introduction of an express clearance system at the Liaobu inland control point at Dongguan when it comes into operation later this year.

Mr. Tsang said the Government had the responsibility to create favorable conditions for the development of information technology, technology and design as well as cultural and creative industries.

In response to the convergence of telephony, broadcasting and the Internet, legislation would be introduced to form a new Communications Authority (merging the functions of the Broadcasting Authority and the Office of the Telecommunications Authority) and to introduce a regulatory framework to promote innovation and competition on par with advanced international standards.

A public consultation will be launched by the end of the year on radio spectrum management, with a view to ensuring a more flexible and effective utilization of the spectrum as a public resource and to facilitate technological advance and evolution of new business models.

The Government will also earmark US$12.82 million (HK$100 million) over five years for the Hong Kong Design Centre to help trades and industries to improve designs and build their brand names.

The film industry will receive a boost with the establishment of a Hong Kong Film Development Council to rationalize the existing government and public organization framework of support for film industry development. About US$5 million (HK$40 million) will be injected into the Arts and Sport Development Fund to buttress support for cultural sector.

As there are still diverse views in the community on whether to legislate for a minimum wage and standard working hours, the Government will work with the business community and the labor sector to launch a Wage Protection Movement to better protect employees in the cleansing and guarding services sectors. A review will be conducted two years after the implementation. If the results are not satisfactory, legislation for a minimum wage in the two sectors will be the next step.

Mr. Tsang said that cherishing the family was a core value of the community and that family harmony was the foundation of social harmony. “Our social policies will continue to be geared towards supporting and consolidating the family, and fostering the well-being of family members,” he said.

The Government will seriously consider whether to establish an integrated, holistic and high-level Family Commission responsible for policies and initiatives relating to family support. The Commission will bring under one roof the various commissions and committees currently responsible for handling issues regarding different age groups and genders.

Mr. Tsang announced two new initiatives to help families with early childhood education, including a US$8.97 million (HK$70 million) grant in the current school year for kindergartens to improve facilities, resources, teaching aids and the provision of books, computers and equipment. An ‘education voucher’ system will also be introduced from the 2007-08 school year to provide fee relief for pre-school students aged between 3 and 6.

The Government will also support the establishment of an Academy for Gifted Education to nurture students aged 10 to 18 who are excellent academic achievers or distinguished performers in specific areas.

Mr. Tsang said Hong Kong deserved and could afford a better living environment. “There exists a strong community consensus on the pressing need to take decisive measures to improve air quality and our environment generally,” he said.

In this regard, Mr. Tsang said the Government would:

• Ensure the environment is the focus of negotiations with power companies on new Schemes of Control agreements, with the permitted rate of return linked to achievement of emission caps;
• Review air quality objectives in light of new World Health Organization guidelines;
• Earmark US$410.26 million (HK$3.2 billion) over three years to incentivise owners of 74,000 older diesel vehicles to replace them with new models meeting Euro IV emission standards;
• Reduce first registration tax by 30%, or up to US$6,410 (HK$50,000) for low-emission, high fuel-efficient vehicles;
• Launch a trial scheme on waste charging at the end of the year;
• Introduce a Product Eco-responsibility Bill to control waste at source.

Mr. Tsang said that he would continue to lead discussions on political development in a positive and responsible manner during the rest of his term.

The Commission on Strategic Development was studying all issues relating to the future development of the political system with a view to sum up their findings in 2007.

“We have made, and will continue to make, strenuous efforts to draw up a blueprint for the future development of our political system, covering 2012 and beyond,” said Mr. Tsang.

“I firmly believe that this is the most practicable way in our quest to realize universal suffrage for the election of the Chief Executive and the Legislative Council.”

Looking ahead, the Chief Executive said political development was among three major challenges facing the third SAR Government, along with sustaining economic development and building a harmonious society.

“These are the thorny issues we need to consider, to tackle and to solve in the days ahead,” he said. “An optimist sees every challenge as an opportunity; a pessimist only sees trouble in every opportunity. I am an optimist and I believe most of us in Hong Kong are, too,” said Mr. Tsang.

The full text of the Policy Address can be found on the Web site:
http://www.policyaddress.gov.hk/06-07/eng/policy.html