Hong Kong well placed to let the poor get richer

PUBLISHED : Thursday, 18 October, 2007, 12:00am
UPDATED : Thursday, 18 October, 2007, 12:00am

When we think of wealth in Hong Kong, a handful of tycoons and conglomerates come to mind. It is easy among the welter of 'rich lists' and the companies with billion-dollar turnovers to forget that there are many residents with lesser fortunes who can nonetheless count themselves members of an internationally recognised club of financial plenty: that of the US dollar millionaire.

As we report today, an annual study by the American financial services company Merrill Lynch has determined that there are 87,000 people in Hong Kong with liquid assets of US$1 million or more. The figure is 12.2 per cent higher than last year.

This is a number to be celebrated. It proves beyond doubt that the free-market principles, which have stood our city in good stead for so long, continue to work in our favour.

The statistic says that a large and growing proportion of society is doing well. Precisely who they are is not divulged by the survey; what we do know, though, is that they now account for an estimated one in every 80 of our population.

Such at-hand wealth is good for Hong Kong. Through consumerism, investment strategies and charity, a large proportion will find its way back into the community.

The policies of levying low personal taxes and providing an investment-friendly environment, solid legal system and sound infrastructure mean that the number of millionaires and their riches are likely to grow. Hong Kong is consequently well placed to thrive.

That we have so many millionaires does not mean our system is perfect, though - no government anywhere in the world can make such a claim. The gap between the wealthy and the poor is widening and bridging it poses a serious challenge for authorities.

A rapidly ageing population poses another threat to Hong Kong's viability, as does environmental degradation. Our leaders are aware of these problems, but further progress needs to be made in efforts to tackle them.

While these are problems that need to be dealt with as we move forward, whatever approaches are adopted should not prevent citizens improving their financial status. Rather, the policies should even the playing field, opening as many wealth-making opportunities as possible for all people.

The Merrill Lynch study suggests that we are on the right track.