Hong Kong continues to provide quality medical and health care services. During the 2014-2015 fiscal year, the HKSAR government's budget for expenditure on medical and health care is HK$52.4 billion, accounting for 17 percent of the government's recurrent expenditure. All Hong Kong residents enjoy equal access to affordable public medical services. By the end of 2012, Hong Kong had more than 35,500 beds in various medical institutions. The infant mortality rate dropped from 4 per thousand in 1997 to 1.6 per thousand in 2013, which is among the world's lowest. In 2013, the life expectancy of Hong Kong's male and female residents was 80.9 years and 86.6 years, respectively, which are among the world's highest.
Cultural and sports activities are flourishing in Hong Kong, where the Chinese and foreign cultures intermingle. The HKSAR government encourages the diverse development of Hong Kong's culture and promotes cultural exchanges. Four unique Hong Kong cultural events were added to the third batch of the State-level Non-material Cultural Heritage List, namely, Yu Lan Ghost Festival, Tai Hang fire dragon dance, Tai O dragon boat parade, and Cheung Chau Jiao Festival. Hong Kong hosted the equestrian events of the Beijing 2008 Olympic Games, and the fifth East Asian Games in 2009. Hong Kong athletes have excelled themselves in events such as windsurfing, table tennis, cycling and martial arts during the Olympics, World Championships and Asian Championships.
Hong Kong's social security service has been continuously improved. During the fiscal year 2014-2015 the HKSAR government's budget for social welfare reached HK$61.9 billion, 3.03 times as compared with the HK$20.4 billion during the fiscal year 1997-1998. Hong Kong has put in place a multilayer and diversified social security and welfare service system. Hong Kong has more than 400 social service agencies, and the number of registered social workers has increased from 8,300 at the end of 1998 to more than 18,000 today. The HKSAR government actively promotes the construction of public housing, moves low-wage residents into public housing, and provides financial aid to those who purchase housing units. Around half of Hong Kong's residents live in housing provided or funded by the government. Among them, more than 2 million live in rented public housing, and over 1 million have purchased housing units with government financial aid.
-Hong Kong's international exchanges and its international influence have further expanded. Hong Kong's international exchanges have been broadened. By June 2013, Hong Kong, as a member of a Chinese government delegation or in other appropriate capacities, had participated in 41 events held by inter-governmental international organizations, and joined 37 inter-governmental international organizations whose membership is not limited to sovereign states. As a member of a Chinese government delegation or in other appropriate capacities, Hong Kong has attended more than 1,400 international meetings; using the name of "Hong Kong, China" it has attended more than 20,000 international meetings not limited to states. It has also hosted or co-hosted more than 1,000 international meetings. The HKSAR has visa waiver agreements with 42 countries, and 150 countries or regions provide visa-free entry or grant visas upon arrival to HKSAR passports holders. Hong Kong has civil air transport agreements, agreements on avoidance of double taxation, agreements on investment promotion and protection, and agreements on criminal justice assistance with many countries. The HKSAR government has economic and trade offices in 11 places, such as Geneva, London, Tokyo, New York and Berlin. Six international organizations, including the European Commission, have representative offices in Hong Kong.
Outstanding Hong Kong professionals have taken important positions in international organizations. Supported by the central government, Chan Fung Fu-chun, former director of health of the HKSAR, was elected director-general of the World Health Organization (WHO) in November 2006, and was reelected in May 2012. She is the first Chinese to head an inter-government international organization since the founding of the United Nations. Shun Chi-ming, director of the Hong Kong Observatory, was elected president of the Commission for Aeronautical Meteorology of the World Meteorological Organization in February 2010.
IV. Efforts Made by the Central Government to Ensure the Prosperity and Development of the HKSAR
The central government has always given high priority to Hong Kong's economic development and improvement of its people's livelihood, and fully supported it in meeting various difficulties and challenges. It gives full play to its role in adopting and executing the national development strategy, and actively promotes exchanges and cooperation between Hong Kong and the mainland, thus providing solid backing for Hong Kong's prosperity and stability.
1. Supporting the HKSAR in Defusing Risks and Meeting Challenges
-Supporting Hong Kong in the fight against the Asian financial crisis. In 1997, the Asian financial crisis broke out, and spread rapidly around the region. Hong Kong was attacked by international speculative forces, its financial market was volatile, its dollar pegged exchange rate system came under attack, and its financial system faced a grave threat. Given these circumstances, the central government solemnly announced that it would safeguard the stability and prosperity of the HKSAR at all costs, strongly support the HKSAR government in protecting the pegged exchange rate system, and not depreciate the RMB. With this support from the central government, the HKSAR government took swift measures that ensured the stability of its financial system and the Hong Kong society.
-Supporting Hong Kong in the fight against SARS. In the first half of 2003, the SARS epidemic hit Hong Kong. It not only posed a threat to the lives and health of the Hong Kong people, but also dealt a blow to Hong Kong's economy that had not recovered from the Asian financial crisis, resulting in deflation, market slump and a high unemployment rate of 8.7 percent. To ensure the safety of life of the Hong Kong people and help the Hong Kong economy climb out of recession, the central government promptly lent a helping hand. Although the mainland also needed medical supplies in the fight against SARS, the central government provided a large quantity of free medical supplies to Hong Kong. The Chinese leaders also went to the hardest-hit areas and hospitals of Hong Kong to inspect local conditions and console victims. On June 29, the mainland and Hong Kong signed the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA), which outlines the steps that the mainland and Hong Kong should take in trade in goods and services, and trade and investment facilitation as well as the goals to be achieved. Later, the Individual Visit Scheme was introduced, allowing mainland residents to visit Hong Kong on their own. These measures helped Hong Kong overcome the SARS attack and boosted its economic growth.
-Supporting Hong Kong in the fight against the international financial crisis. When the international financial crisis broke out in the second half of 2008, the central government was highly concerned about its impact on Hong Kong. In December of that year, it introduced 14 policies to ensure economic and financial stability in Hong Kong. In January 2009, the central government launched more policies, including the signing of a RMB200 billion currency swap agreement by the People's Bank of China with the Hong Kong Monetary Authority. Later, when visiting Hong Kong, the Chinese leaders announced a number of policies to support Hong Kong's economic development, improve the local people's livelihood, and strengthen its exchanges and cooperation with the mainland. All these policies played a positive role in boosting confidence, strengthening capability to defuse risks and stimulating the economic recovery of Hong Kong.
2. Supporting the HKSAR in Reinforcing and Enhancing Its Competitive Strengths
-Supporting Hong Kong as an international center of finance, trade and shipping. The central government supports Hong Kong in launching individual use of RMB, issuing RMB bonds and conducting trials of RMB settlement in cross-border trade, thus consolidating Hong Kong's position as a leading offshore RMB market. It has continued to encourage the listing of mainland enterprises on the stock market in Hong Kong, and introduced other measures to support Hong Kong's financial sector. In 2013, a total of 216 Hong Kong banks joined the RMB clearing platform, and the amount of cross-border RMB settlement in Hong Kong reached RMB3.84 trillion, accounting for 82.9 percent of the total cross-border RMB settlement of China. The balance of Hong Kong's RMB customer deposits and depository receipts reached RMB1 trillion. Hong Kong has become the world's largest offshore RMB trading center. After the signing of the CEPA in 2003 and its coming into force in January 2004, the mainland signed and implemented ten supplementary agreements with Hong Kong. The mainland now gives zero tariff treatment to all products of Hong Kong origin. From that time to the end of 2013, the mainland imported from Hong Kong goods worth US$7.161 billion under the CEPA, with tariff preference of RMB3.983 billion for Hong Kong. The mainland also adopted a total of 403 liberalization measures in respect of trade in services. Based on WTO classification, the mainland has opened to Hong Kong 149 areas of trade in services under the CEPA and its supplementary agreements, accounting for 93.1 percent of the total number of such areas of the mainland. This makes the CEPA the most open agreement on free trade that the mainland has ever signed. In addition, Guangdong Province has adopted 82 pilot measures to open its services industries to Hong Kong. When drawing up the National Plan for the Layout of Coastal Ports, and the 12th Five-Year Plan for the Comprehensive Development of Transportation Systems, the central government took into account the need to consolidate and enhance Hong Kong's position as an international shipping center.
-Supporting Hong Kong in developing its tourism and retail sectors, and Hong Kong-invested companies on the mainland. At the request of the HKSAR government, the central government gradually expanded the Individual Visit Scheme to 49 pilot cities, with a total population of over 300 million. By the end of 2013, some 129 million mainland residents had visited Hong Kong under the Individual Visit Scheme. According to estimate of the HKSAR government, in 2012 alone the Individual Visit Scheme contributed to 1.3 percent increase of Hong Kong's GRP of the year, and it created more than 110,000 jobs, accounting for 3.1 percent of the local employment. To bring more benefits to medium-sized and small businesses and residents in Hong Kong, the central government also allows Hong Kong residents to start individual businesses on the mainland. By the end of 2013, a total of 5,982 individual businesses opened by Hong Kong residents had been registered on the mainland, employing 16,476 people. The central government encourages the development of Hong Kong processing and trading companies on the mainland, and has assisted the transformation and upgrading of Hong Kong-invested companies on the mainland. In 2009, Guangdong Province introduced 30 policies to help companies established with Hong Kong, Macau and Taiwan investment weather the international financial crisis and accelerate their transformation and upgrading. In December 2011, the central government issued the Guidelines on Promoting the Transformation and Upgrading of Processing Trade, and set up demonstration zones and pilot cities for the transformation and upgrading of processing trade in Suzhou and Dongguan, as well as 44 key areas in central and western China to relocate enterprises of processing trade in a phased way.
