II. Economic Development

19.         Sustained economic growth is a prerequisite for us to tackle housing, poverty, ageing population, and environmental problems. Promoting economic development is therefore the primary goal of the Government. During my term, I am fully committed to the principle of keeping expenditure within the limits of revenues, and to maintaining a business-friendly environment with a simple and low tax regime.

Role of the Government

Appropriately Proactive Governance

20.         To promote economic development, the Government must be "appropriately proactive". The Government should refrain from intervention when the market is functioning efficiently, except to ensure a level playing field. But in cases of market failure, the Government must take appropriate action to address the problem. In the past six months, we have taken such actions in a proactive manner. To address housing shortage, we have introduced and implemented the policy of "Hong Kong property for Hong Kong people" to give priority to the needs of local home buyers over non-Hong Kong residents. We have also introduced the Buyer's Stamp Duty and, through administrative means, disallowed delivery bookings for expectant Mainland mothers with no ties to Hong Kong. These measures are examples of "appropriately proactive" governance. They have received public support and started to deliver results.

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