Hk Economy Mid-Term - How Did Hong Kong Grow into Such a “powerful” Economy?

HK Economy Mid-term

1. How did Hong Kong grow into such a “powerful” economy?
    There are two major factors to make Hong Kong grow into such a “powerful” economy. Historical Factors and Institutional Factors.

 In aspect of historical factors, first thing is the labour, capital and entrepreneurial skill. Because of those political events such as civil war in China, a huge inflow of labour, capital, and entrepreneurial skill from China to Hong Kong occurred during the period 1948-51. Those taking refuge in Hong Kong included young and energetic people who were intelligent and willing to work hard, alongside people with capital and skilled entrepreneurs. The huge inflow of human and capital resources from China formed the basis of Hong Kong’s industrialization. Also, there was an inflow of capital and entrepreneurial skill from the West and South-East Asia.

  Second thing is the decline in entrepot trade. Hong Kong’s entrepot trade declined after 1951 because of two factors. First was the Communist takeover of China. Because of political reasons, the Communist government traded with Soviet Russia and the Eastern European countries rather than with the west and other parts of Asia. Therefore, Hong Kong lost its importance as an agent of China’s foreign trade. Also, the outbreak of Korean War in 1950 led to the United Nation embargo in 1951.

  In aspect of institutional factors, first thing is the British administration. Because of it, Hong Kong enjoyed the advantages of Commonwealth preference and membership in the sterling area. It made Hong Kong’s products to be more competitive in overseas, also helped to have a stable currency.

Second thing is the practice of Laissez-faire Capitalism. Hong Kong Government has pursued the non-intervention administration, applied all internal and external economic activities. Hong Kong gives freedom and opportunities to business people and industrialists to better themselves and the economy.

1. What are the major core value of the HK people?

  There are three major core values of the Hong Kong people. Opportunities, hard work, and self-help.

  In aspect of opportunities, Hong Kong people has been good at take the chance. Hong Kong people can work with high productivity, cost-effective. Those specialties makes us keep track of the global trend, always able to recognize and take the chance. For example, the Korean Wave. The Korean culture is the strong soft power of Korea and it is very popular in the global in current year. Hong Kong’s business man find out its advantages of it and bring it to local. Food, Film, lots of Korean products can find in Hong Kong. That create a lot of opportunities for business.

  Additionally, one of the core value of Hong Kong people is hard work. As I mentioned before, Hong Kong people always work with high productivity, cost-effective. We have strong sense of time urgency, want to finish two or more works in once time. That how we maintain our competitiveness at global economy.

  On the other hand, self-help is the important core value of Hong Kong people. Hong Kong people have a strong sense of independent. No matter in political, economic, or personal live. We do our job on our own rather than relying on others. For example, when we run a business and try to bring a foreign product into Hong Kong, we choose which products to import by our own decision. Sometimes, we even fly to the place of origin to find the supplier our own. We got a strong belief in ourselves.