Social inclusion key to economic progress, Lam says in Davos

January 24, 2019 16:40
Hong Kong’s leader Carrie Lam speaks at an event at the World Economic Forum in Davos on Wednesday. Credit: World Economic Forum

Given its open economy, Hong Kong is inevitably affected by external factors, but the territory is well placed to ride out the challenges, Chief Executive Carrie Lam said on Wednesday.

During a panel discussion at the World Economic Forum (WEF) in Davos, Switzerland, Lam said Hong Kong is positioning itself to take advantage of opportunities in mainland China and elsewhere in Asia.

Hong Kong is proactively participating in China's Belt and Road Initiative, Lam said, outlining the importance of greater international cooperation. 

The Hong Kong government is willing to strengthen ties with emerging economies to help them develop, she added.

“We should take this opportunity to improve governance, to focus more on trade rules, more regulatory collaboration and to put in policies to deal with poverty and income disparity,” Lam said.

Talking about emerging economies, Hong Kong's leader stressed the importance of sustainable and inclusive development.

"If economic growth, especially in the emerging economies, does not meet this requirement of inclusiveness, we may end up with some of the problems that mature economies are now facing."

Wealth inequality has become a big problem in the world today, and governments cannot afford to ignore the issue of social welfare, Lam said. 

"People are very aggrieved, there is unequal distribution of resources, and young people do not have enough opportunities. So some very strange things will happen when you turn to the people for a decision if they are so unhappy, as we have seen from some election results and also some referendums."

During the forum, Lam boasted that Hong Kong has got its policy priorities right, devoting lot of resources to social welfare and spending on the poor population.

“In the case of Hong Kong, we are a small economy, our public sector accounts for only 20 percent of GDP. But we spend 60 percent of that 20 percent of GDP on social services," Lam said, RTHK noted.

Among other topics, Lam touched on the US-China trade war during her WEF media interactions.

Asked in an interview as to whether she thinks China and the United States can move toward a deal following their 90-day trade war truce, Lam didn't seem very optimistic.

Judging from discussions with US officials and business representatives, it appears the world's top two economies need to address some fundamental problems beyond the US trade deficit, Lam said.

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