General Information of Hong Kong Special Administrative Region (SAR)

Hong Kong, described as a 'barren rock' over 150 years ago, has become a world-class financial, trading and business centre and, indeed, a great world city.
Hong Kong has no natural resources, except one of the finest deep-water ports in the world. A hardworking, adaptable and well-educated workforce of about 3.5 million, coupled with entrepreneurial flair, is the bedrock of Hong Kong's productivity and creativity.

Hong Kong became a Special Administrative Region (SAR) of the People's Republic of China on July 1, 1997, after a century and a half of British administration. Under Hong Kong's constitutional document, the Basic Law, the existing economic, legal and social system will be maintained for 50 years. The SAR enjoys a high degree of autonomy except in defence and foreign affairs.

Location: Eastern Asia, bordering the South China Sea

Area: 1,092 sq km

Climate: tropical monsoon; cool and humid in winter, hot and rainy from spring through summer, warm and sunny in fall

Terrain: hilly to mountainous with steep slopes; lowlands in north

Population: 6.78 millions

Religions: eclectic mixture of local religions 90%, Christian 10%

Languages: Chinese (Cantonese), English Literacy: definition

GDP

Over the past two decades, the Hong Kong economy has almost tripled, with GDP growing at an average annual rate of 5.1 per cent in real terms. This means Hong Kong has outperformed the growth of the world economy as well as that of the Organisation for Economic Co-operation and Development economies. Per capita GDP in Hong Kong has more than doubled over the same period, equivalent to an average annual growth rate of about 3.8 per cent in real terms. In 2002, it reached US$24,014, second only to Japan in Asia and higher than many Western countries.

Economy

Hong Kong is characterised by its high degree of internationalisation, business-friendly environment, rule of law, free trade and free flow of information, open and fair competition, well-established and comprehensive financial networks, superb transport and communications infrastructure, sophisticated support services, and a well-educated workforce complemented by a pool of efficient and energetic entrepreneurs. Added to these are substantial fiscal reserves and foreign exchange reserves, a fully convertible and stable currency, and a simple tax system with low tax rates.

Tax System

Hong Kong's tax system is one of the most business-friendly in the world - simple and low. Taxes are levied on three types of income only - on profits, salaries and property. There is no value-added or sales tax or capital gains tax. Only income sourced in Hong Kong is taxable.

Profits Tax:  Profits are taxed if they arise in or are derived from Hong Kong as a result of a trade, profession or business. The tax rate in 2002 is 16 per cent for corporations and 15 per cent for other businesses.

Salaries Tax:  Everyone with a Hong Kong income arising from any office, employment or pension is liable to salaries tax. In 2002, the rate of tax after deductions and allowances is applied on a graduated scale, but the total salaries tax charged will not exceed 15 per cent of a person's total assessable income.

Property Tax:  Owners of land and/or buildings in Hong Kong are charged property tax, which is based on the property's rental income. In 2002, the rate of tax is 15 per cent on the annual rent receivable less a statutory deduction of 20 per cent for repairs and outgoings.

Transportation:

Hong Kong is a highly mobile city, with 12 million passenger trips made daily on an efficient and multi-mode public transport system which includes railways, trams, buses, public light buses, taxis and ferries. The public transport services offer commuters a good choice of different transport modes at reasonable fares and different levels of comfort, speed and convenience. Public transport services are provided by private operators or public corporations without direct subsidy from the Government.

Railways: Railways form an important part of the public transport system. They account for some 30 per cent of the total daily public transport volume. The Kowloon-Canton Railway (East Rail) runs from Hung Hom in Kowloon to the Mainland boundary at Lo Wu. There are 13 stations along the 34-kilometre route and the railway carries an average of 810 000 passengers daily.

The Mass Transit Railway System is an underground railway network, consisting of five lines and the dedicated Airport Express. The route length is 87.7 kilometres with a total of 49 stations. The number of passengers averages over 2.3 million per weekday.

The Light Rail System serves the new towns in the northwest New Territories. The system comprises 31.75 kilometres of double track, 119 single-deck light rail vehicles and 57 stops. About 314 000 passengers travel daily on the system.

Electric trams have been running on Hong Kong Island since 1904. A total of 164 trams make up the only all double-decker tram fleet in the world and handle about 240 000 passenger trips daily.

A cable-hauled funicular tramway runs between Central and the Peak. The 1.4-kilometre line began operation in 1889, climbing 373 metres on a gradient as steep as one-in-two. The line carries about 10 000 passengers a day, mainly tourists and local sightseers.

Buses: Franchised buses are the largest carrier and account for 39 per cent of the total daily public transport volume. There are about 600 bus routes operated by five franchised bus companies. The total licensed fleet of 6 378 buses, mostly air-conditioned double-deckers, carries an average of 4.3 million passengers daily. Public light buses are minibuses with not more than 16 seats. Their number is 4 346 vehicles. The public light buses carry about 1.6 million passengers daily. Hong Kong's 18 138 taxis carry a daily average of 1.6 million passengers.

Ferries: Ferries provide an essential mode of transport for the outlying islands. In the inner harbour and the new towns, ferries offer a supplementary mode of transport to the buses and the railways. About 150 700 passengers use the ferry services daily.

Road Network: At the end of 2002, Hong Kong had 1 924 kilometres of roads and 1 044 road structures, three immersed-tube cross-harbour tunnels, nine road tunnels through the hills and three bridges built high above sea level. These facilities provide a comprehensive road network.

There were 525 551 licensed vehicles, including 340 855 private cars. Hong Kong's traffic density of 273 vehicles per kilometre of road is among the highest in the world. Despite this, traffic usually flows smoothly even in peak hours.

Editor: Donald