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Reports of Hong Kong's 'death' greatly exaggerated

By Xin Dingding in Hong Kong (China Daily)

08:43, June 28, 2012

In 1995, Fortune magazine famously predicted the death of Hong Kong.

"The naked truth about Hong Kong's future can be summed up in two words: It's over," read its cover story by Louis Kraar in June of that year. He concluded by saying the world would soon be "mourning the death of what had once been one of the world's great business cities".

Twelve years later, the magazine, which is based in the United States, admitted that, frankly, it had got it wrong.

Along with many international financial experts, Fortune acknowledged that, after the handover of Hong Kong by the British to the Chinese central government on July 1, 1997, the area not only survived, it thrived.

"Things are even better now," said Peng Qinghua, director of the liaison office of the central government in the Hong Kong Special Administrative Region, in a recent interview ahead of the 15th anniversary of the handover.

He said the progress that has taken place over the past 15 years proves the strong vitality of the "one country, two systems" arrangement.

To maintain Hong Kong's prosperity, the central government has been adhering to the Basic Law, as well as to promises to maintain its social and economic systems, while its legal system has basically remained unchanged, he said.

"Today's economic achievement is the result of Hong Kong people's ability to take opportunities, as well as their flexibility and diligence," Peng said. "However, it couldn't have been done without strong support from the motherland, too."

When the region's economy hit lowest point in 2003, under the influence of the 1997-98 Asian financial crisis and the SARS outbreak, the central government came to the rescue.

The Closer Economic Partnership Arrangement, a free trade agreement, was signed in 2003 to give Hong Kong enterprises greater access and lower tariffs to mainland markets than companies from other regions.

Mainland tourists in a number of cities were also allowed to visit Hong Kong without joining tour groups, which gave the local economy a shot in the arm.

In recent years, the central government also took actions to solidify Hong Kong's status as a world financial center, by encouraging mainland enterprises to list on the Hong Kong Stock Exchange and supporting Hong Kong to develop offshore yuan businesses.

Large transport infrastructure was also extended to the island city, such as the bridge linking Hong Kong, Macao and Zhuhai, and the high-speed railways connecting Guangzhou, Shenzhen and Hong Kong.

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