Tackle The Problem In Hong Kong Economics Essay

In the past decennary, the Hong Kong Special Administrative Region Governments latest nose count shows the wealth spread between the rich and hapless has widened.A It show that the figure of Hong Kong households income less than HK $ 4000 a month or less had increased from 123869 in twelvemonth 1996 to 205515 in twelvemonth 2006 ( from 6.7 per centum to 9.2 per centum ) ; in the same clip, those on more than HK $ 40,000 had increased from 278703 in twelvemonth 1996 to 378473 in twelvemonth 2006 ( from 15 per centum to 17 per centum ) .A The income inequality nose count besides found that the existent mean income of households has fallen 7.8 per centum since 2001.A The state of affairs is besides reflected by the latest Gini coefficient, a step that is used to find the spread between the rich and poor.A Hong Kongs Ginis coefficient had risen from 0.518 to 0.533 over the past 10 years.A Coefficients at or above 0.4 means the society has reached an dismaying degree in wealth gap.A The figure remains among the highest in the developed states, when compared with the latest figures from Canada, Britain, New Zealand and Singapore.

Dividing the population into 10 equal-weighted decile groups, the Census Department found the average monthly family income for the richest 10 per centum of Hong Konger was HK $ 78,000 ( USD10,000 ) in 2006, which is 32.5 times more when compared with HK $ 2400 ( USD308 ) for the poorest 10 percent.A The wealths group of families, or top 10 percent income gaining households, represents 41.4 per centum of money made by the full population last twelvemonth ; while the bottom 10 per centum constitutes 0.8 per centum.

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The displacement of Hong Kongs economic construction from fabricating oriented to knowledge based service industry trust demands higher educated workforce.A A This is the chief ground contributes to the income disparity in Hong Kong.A Many workers with low accomplishment and instruction degree are in the in-between and old-age groups, and among the new migrators from the mainland China.A This group of people is confronting the job of working hapless and many of them are now working in the low-wage and low-skilled sector.A Whereas the higher income group consists of chiefly dual-income families with higher instruction degree, benefited from the metropolis overall economic recovery and restructure.

The broadening of wealth spread has become a critical societal job in Hong Kong.A The metropolis is confronting the societal public assistance challenges of an ageing society, altering demographic composing, and an progressively competitory concern environment.A

The authorities is researching a series of steps to better this situation.A One of the ventures is to present societal endeavors plan, which encourages companies, non-governmental groups and persons to put up concerns in communities with high concentrations of low-income households, to make occupation chances and develop the disadvantaged.A Although societal endeavors may offer a executable solution to make more employment chances, the authorities should pull more companies to put up concerns in Hong Kong.A Education and preparation are important to accomplishing fairer wealth distribution ; raising the instruction degree of the less privileged groups help travel workers up the occupation ladder or into better-paying careers.A Through instruction, the following coevals from disadvantage background could hold better chances to better their life criterions and to cut down the hazard of intergenerational poorness. The authorities had set aside a Child Development Fund of HK $ 300 million for this intent.

Education Void Expands Wealth Gap

National lawgivers and political advisors have strongly warned against turning educational unfairnesss between urbanites and husbandmans, stating the state of affairs may foil the state ‘s attempts to contract the widening national wealth spread.

Given desperate fiscal deficits in the countryside, they are naming on the authorities to set up equity in apportioning educational resources between rural and urban countries.

“ The Southern Cross to the job of the rich-poor spread is that most low-income people have received small or deficient instruction, ” said Hao Ruyu, a National Committee member of the Chinese People ‘s Political Consultative Conference.

“ Merely by supplying them with equal educational chances can they portion more of the fruits of economic development. ”

He stressed that educational equity instead than revenue enhancement accommodations — as proposed by a big figure of economic experts — can function as the most of import tool in contracting the wealth spread.

Mentioning research based on statistics from more than 50 states, Hao said educational disparities and unequal educational chances result in enormous income disparities, both in developed and developing states.

“ That ‘s why the Western states pay great attending to fairness in instruction to guarantee all people enjoy equal chance to accomplish success in life and go rich, ” said Hao, besides vice-president of the Capital University of Economics and Business.

But authoritiess at all degrees in China have neglected the significance of educational equity between urban and rural countries, said Zhou Hongyu, a Hubei deputy to the National People ‘s Congress ( NPC ) .

“ Due to the authorities ‘s unreasonable and unfair educational support mechanisms, most of China ‘s educational resources have been concentrated in metropoliss, ” he said.

Statisticss suggest every bit much as 77 per cent of the state ‘s instruction support went to metropoliss in 2002, while rural countries, with 60 per cent of China ‘s entire population, received merely 23 per cent of the financess.

The shriveling disbursement on rural instruction has led to widespread jobs in pupil registration, school conditions and even rural instructors having their wages.

Dropout rates among rural pupils remain high despite the authorities ‘s heightened attempts to accomplish nine-year compulsory instruction for citizens countrywide.

It is estimated that most of the 1.1 million dropouts in primary schools throughout the state are from rural countries.

As a consequence of hapless instruction, the figure of rural pupils who go to elite universities has been worsening over the past decennary, harmonizing to recent research.

Rural pupils accounted for 17.6 per cent of the sum in esteemed Tsinghua University in 2000, a lessening of 4.1 per cent from 1990, harmonizing to the research.

Meanwhile, the proportion of rural pupils dived to 16.3 per cent in 1999 at Peking University, compared with 18.8 per cent in 1991.

To turn to the deterioration job, NPC deputy Liu Xiao from Hunan Province urged the authorities to shoulder more duty for escalating rural instruction through sufficient State support.

“ The authorities should increase its fiscal input in rural countries so as to better school conditions at that place, ” he said.

The NPC deputy added that the authorities should besides promote rural teacher-training through particular support and policy inducements in order to better the quality of learning in the countryside.



Education is ever the best method to extinguish poorness because one ‘s academic making is extremely correlated to his/her wage. In the yesteryear, being able to come in university is even tantamount to a warrant of a epicurean life in the hereafter. However, as instruction in Hong Kong has become extremely accessible, the figure of people possessing a grade enormously increases. So it is now more of import to hold practical cognition of a profession than to simply hold a certification. Returning to the point, an academic making of third instruction has hence become much more important. In fact, it is about a basic demand for a stable occupation.


In times of prosperity, making little concern might give you an chance to delve yourself the “ first pail of gold ” . Puting up a concern sometimes does non affect excessively much capital. All you might necessitate are superb thoughts. Therefore, in the recent old ages, many pupils have had their first gustatory sensation of being a bourgeois by making a little concern in a stall in a Lunar New Year carnival. A normal worker can ne’er see the feeling of acquiring net incomes from a concern. But if you do non desire to do attempts in get downing up a concern, another channel of investing is puting on stocks, financess and the similar. These besides allow you to hold a portion in the concerns of the rich. Of class, investing bears risks ; when there are additions, there may be losingss, excessively.


Do n’t acquire it incorrect. This does non intend that you should cleaving onto the rich and pray that you can be married into one of the affluent households. But it is undeniable that there are so many instances of get awaying poorness by matrimony. In fairy narratives, Cinderella and her prince got married and they lived merrily of all time after. In Chinese costume play, a hapless pupil married a princess and so soared to go a prince. From so on, his calling way smoothened. In world, “ to get married a rich adult male ” is the common dream of many people. This is one of the best “ unreal ” ways to get away poorness.


Normally after a piece at a certain place at work, experiences are accumulated, you may acquire promoted and a rise in salary. Through an promotion of accomplishments, the same can be achieved. A publicity at work implies more net incomes, which straight lessen at least a portion of your load. Sometimes a alteration of occupation gives you a higher rise in salary than a publicity does. That is why a big figure of endowments choose to leap ships when the market is comfortable. Recently there has been intelligence about endeavors giving rises to employees in add-on to fillips in order to carry the talented to remain. But for those who have no working experience, analyzing difficult at school is a much more practical option.


Increasing Taxes and Enhancing Welfare

In Europe and the U. S. , authoritiess collect heavy revenue enhancements from the rich and in return, they provide all-around societal public assistance to the hapless. This can be seen as an effort to alleviate, to a certain extent, the wealth spread job in the society. The public assistance that authoritiess supply for the hapless does function to contract down the wealth spread but merely on a short-run footing. In the long tally, nevertheless, it does non truly assist them get away poorness. Besides, in taking to pull international investors to Hong Kong, low revenue enhancement rate is set up and this undercuts the Hong Kong Government ‘s capableness of supplying better societal public assistance for the people. In the hereafter 8 to 10 old ages, Hong Kong ‘s usual pattern of “ large market, little authorities ” will most likely non be abandoned. The policy of increasing revenue enhancements in alleviating the wealth spread job will so most probably non be adopted.

Helping in Employment

To happen a occupation for the people from the lower category has invariably been the way the Hong Kong Government has taken in extinguishing poorness. Productivity is a cardinal status of get awaying poorness. The Government promotes and encourages employment guidance and creates employment chances. Employment reding allows occupation searchers to accommodate to the market demands. By assisting occupation searchers get the right occupation and companies get the right individuals, it becomes easier for the lower category to stand on their ain pess in occupation seeking. The Government used to make legion employment chances by presenting big-scale buildings of substructures, pulling building workers. Now, the Government is be aftering to back endeavors in the hope of constructing a self-sufficing community and, of class, making employment chances.

Minimal Wage

Having a occupation does non needfully connote a worry-free life. For occupations like cleansing, cashier, security and others, the hourly rate may come lower than $ 10. Employees working for occupations of this kind work long hours to be able to feed themselves. Most European states and the U. S. have established a minimal pay to protect laborers who work at this kind of low-skilled places. And last twelvemonth, on the Eve of the proclamation of the Chief Executive ‘s policy reference, there were ardent arguments in the society over the inquiry of puting minimal rewards. Now that the Government does non choose for legalising it, its attack has changed to one of advancing a “ pay protection run ” . This is all to give assurance to endeavors to offer income in the prevailing graduated table.

Solving Cross-generation Poverty

Children Born and turn up in hapless households do non bask the support of sufficient resources ; their societal competency might non be good developed. And when they finally grow up, they end up following the old way of their parents and to go hapless. This is known as “ cross-generation poorness ” . Particularly in a knowledge-based economic system like Hong Kong and wholly with the instead disadvantageous conditions in turning up, the destiny of these kids are impossible to take a turn. The Government has decided to establish the “ Children ‘s Development Fund ” , which makes it possible for the kids from the lower category to hold a certain amount of capital to let them to travel to university, farther their surveies and add values to themselves. Consequently, the opportunity for the following coevals to remain hapless is so appreciably reduced.



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