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  • Introduction:Poverty in a Rich Society—The Case of Hong Kong
  • Maggie Lau (bio)

Hong Kong has remained a wealthy financial hub despite its export-oriented economy being adversely interrupted by the challenging global economic uncertainties and vulnerabilities that have occurred since the late 1990s. Severely hit by the Asian financial turmoil, Gross Domestic Product (GDP) growth significantly decreased from 11.2% in 1997 to −4.7% in 1998. There has been sharply slower economic growth in 2001 (−1.2%), in 2003 (−3.1%) and in 2009 (−2.8%), following the recession after the global economic slowdown in 2001, the prevalence of the Severe Acute Respiratory Syndrome in 2003 and the global financial crisis in 2008 respectively.1 The Hong Kong economy has begun to run into difficulties partly as a result of the financial crises and partly as a result of increased competition from other cities in Mainland China and other neighbouring countries. Even so, Hong Kong’s economy has emerged from the financial crises in a relatively better shape than most of the economies of the Organization for Economic Co-operation and Development.2 Over the last decade, the Hong Kong economy has grown by about 50%. Hong Kong’s per capita GDP rose to US$38,100 in 2013 (GDP at current market prices).

Yet, Hong Kong’s income inequality is greater than that in any developed economy.3 The growing unequal income distribution and poverty in Hong Kong have aroused public concern. Global processes of economic change have contributed to the growth of the service sector [End Page 1] accompanied by an increasing number of professional and managerial jobs, and the decline in the traditional manufacturing industry has resulted in the growth of precarious employment with inadequate stable income and limited coverage of social security benefits.4 As a result, this has further intensified income disparities in Hong Kong over the last decade. The income share earned by the lowest 20% of income households decreased from 3.2% in 2001, to 2.7% in 2011, whereas the income share earned by the highest 20% of income households increased from 56.5% to 57.1%.5

Numerous studies have shown the plight of low-skilled workers,6 single parents and immigrant families with dependent children,7 and older people8 in the midst of the global economic restructuring and uncertainties. There is increasing concern about low remuneration and benefits for people engaged in informal employment (e.g. exclusion from social protection), intergenerational mobility and equality of opportunity, and dignified care and support for the older people. Demographic shifts in family structure imply that there will be fewer younger people available to provide financial and caring support for their family members in the future. The rising number of divorce and separation cases, together with small families and the increasing nuclearisation of families, have undoubtedly weakened the traditional support mechanisms and led to growing demand for formal systems.9

Poverty and social exclusion have become recognised as one of the pressing social issues to be addressed by the Hong Kong Special Administrative Region (HKSAR). Over the years, there have been debates about how to use our fiscal reserves better (which stood at HK$733.9 billion as on 31st March 2013) to support the needy.10 The re-establishment of the Commission on Poverty set the first official poverty line at 50% of the median monthly household income in Hong Kong. As stated by Report on the Poverty Situation in Hong Kong 2012, it is an “unprecedented move [that] demonstrates the Government’s commitment to poverty alleviation.”11 2014 Policy Address initiated several new poverty alleviation measures addressing working poverty (e.g. the Low-income Working Family Allowance), intergenerational poverty (e.g. Support for the School-based After-school Learning and Support Programme), and old-age poverty (e.g. increasing the annual voucher amount under the Elderly Health Care Voucher Scheme; consideration of expanding the scope of the existing Elderly Dental Assistance Programme).12 [End Page 2]

This special issue is a timely and important opportunity to advance the theory and practice of poverty and social exclusion measurement, and to conduct policy relevant analyses in Hong Kong. To...


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