18 AUG 2011

Category One Country Two Systems Principle
Issue Vice-Premier Li’s visit to Hong Kong
News Content Visiting Vice-Premier Li KeQiang announced a package for more than 30 measures to boost the local economy by strengthening Hong Kong’s role in the internationalization of the Yuan. One of the key measures is to support the stock market by allowing mainland investors to invest in Hong Kong stocks by launching the index-tracking Exchange Traded Fund backed by a portfolio of Hong Kong stocks. Andrew Fung, the head of treasury and investment at HS Bank, quoted by SCMP, said: ‘China is speeding up its pace of internationalizing the currency by these new measures.’ Johnny Lau, the current affairs commentator familiar with China politics, said Beijing is of the view that if economic issues are not handled properly, they would escalate into political problems.
Questions The key measure announced by Li is yet to solve the city’s deep-rooted conflicts. Without a sound economic and social change, the measure itself only helps widen the rich-poor gap.