Updated at 4.04pm: Almost a decade after the handover, Hong Kong was enjoying strong economic growth and closer relations with the mainland, Financial Secretary Henry Tang Ying-yen told the annual dinner of the Federation of Hong Kong Industries at Island Shangri-La Hotel on Monday evening.
'As we are approaching a milestone in the history of Hong Kong - the 10th anniversary of the establishment of the Hong Kong Special Administrative Region, we are encouraged to see a continuing thriving economy,' Mr Tang said.
Hong Kong was returned to China on July 1, 1997 - during a time of political and economic uncertainty. There were concerns that China, despite having abandoned its Marxist-Leninist economic policies, might interfere with the territory's economic freedoms.
Hong Kong was also rocked by the 1997-98 Asian economic crisis and severe acute respiratory syndrome (Sars) outbreak of early 2003. During this time, it experienced a substantial property crash, rising unemployment and a drop in business confidence.
But today, Hong Kong's economy had recovered and remained one of the freest in the world. It is also benefiting from China's rapid economic growth.
Mr Tang said Hong Kong's economic fundamentals in 2007 were impressive.