Hong Kong

Hong Kong (香港, see Name section) is one of the two Special Administrative Regions of the People's Republic of China, the other being Macau. It is situated on China's south coast and, enclosed by the Pearl River Delta and South China Sea, it is known for its expansive skyline and deep natural harbour. With a land mass of 1104 km2 and a population of seven million people, Hong Kong is one of the most densely populated areas in the world. Hong Kong's population is 93.6% ethnic Chinese and 6.4% from other groups. Hong Kong's Cantonese-speaking majority originate mainly from the neighbouring Canton (now Guangdong) province, from which many of them fled to escape wars and Communist rule in the 1930s to the 1960s.

Hong Kong became a colony of the British Empire after the First Opium War (1839–42). The Hong Kong Island was first ceded to the UK in perpetuity, followed by Kowloon Peninsula in 1860 and then the New Territories was put under lease in 1898. It was occupied by Japan during the Pacific War (1941–45), after which the British resumed control until 1997, when China resumed sovereignty. The region espoused minimum government intervention under the ethos of positive non-interventionism during the colonial era. The time period greatly influenced the current culture of Hong Kong, often described as "East meets West", and the educational system, which used to loosely follow the system in England until reforms implemented in 2009.

Under the principle of "one country, two systems", Hong Kong has a different political system from mainland China. Hong Kong's independent judiciary functions under the common law framework. Hong Kong Basic Law, its constitutional document, which stipulates that Hong Kong shall have a "high degree of autonomy" in all matters except foreign relations and military defence, governs its political system. Although it has a burgeoning multi-party system, a small-circle electorate controls half of its legislature. The head of the government, the Chief Executive of Hong Kong, is chosen by an Election Committee of 400 to 1,200 members, a situation that will be in effect during the first 20 years of Chinese rule.

As one of the world's leading international financial centres, Hong Kong has a major capitalist service economy characterised by low taxation and free trade, and the currency, Hong Kong dollar, is the eighth most traded currency in the world. The lack of space caused demand for denser constructions, which developed the city to a centre for modern architecture and the world's most vertical city. Hong Kong has one of the highest per capita incomes in the world. The dense space also led to a highly developed transportation network with the public transport travelling rate exceeding 90 percent, the highest in the world. Hong Kong has numerous high international rankings in various aspects. For instance, its economic freedom, financial and economic competitiveness, quality of life, corruption perception, Human Development Index are all ranked highly. According to estimates from both UN and WHO, Hong Kong had the longest life expectancy of any region in the world in 2012. An academic study has also concluded that Hong Kong has the highest average IQ scores among the 108 countries examined, with an average IQ of 107. Research date was on April 28, 2013.

Name
The name "Hong Kong" is an approximate phonetic rendering of the pronunciation of the spoken Cantonese or Hakka name 香港, meaning "fragrant harbour". Before 1842, the name referred to a small inlet — now Aberdeen Harbour or 香港仔 hoeng1 gong2 zai2 "Little Hong Kong" — between Aberdeen Island and the south side of Hong Kong Island, which was one of the first points of contact between British sailors and local fishermen.

The reference to fragrance may refer to the harbour waters sweetened by the fresh water estuarine influx of the Pearl River, or to the incense from factories lining the coast to the north of Kowloon, which was stored around Aberdeen Harbour for export before the development of Victoria Harbour. In 1842, the Treaty of Nanking was signed, and the name Hong Kong was first recorded on official documents to encompass the entirety of the island.

The name was often written as the single word Hongkong until the government adopted the current form in 1926. Nevertheless, some century-old organisations still use the single-word form, such as the Hongkong Post, Hongkong Electric and the Hongkong and Shanghai Banking Corporation.

The Mandarin Chinese pronunciation of the name 香港 is represented in pinyin as Xiānggǎng. Unlike place names in Mainland China, which are now mostly romanised into English using (Mandarin-based) pinyin spelling, the official English name in this case remains the traditional Hong Kong.

The full official name is "Hong Kong Special Administrative Region of the People's Republic of China", this being the official convention employed on the Chinese text of the Hong Kong regional emblem, the text of the Hong Kong Basic Law, and the Hong Kong Government website, although "Hong Kong Special Administrative Region" and "Hong Kong" are also accepted. (Chinese versions of the territory's names can be found in the lower box to the right.)

Hong Kong has many nicknames, but the most famous is "Pearl of the orient" (Cantonese: Dong Fong Chi Chu). It was named according to the shiny city lights from both sides of Victoria Harbour and the high rise buildings. In addition, Hong Kong is also named as "Golden Egg", "The World's most vertical City", "The orient Manhattan", "The paradise of shopping", "Food paradise" and "City of life".

Pre-colonial
Archaeological studies support a human presence in the Chek Lap Kok area from 35,000 to 39,000 years ago, and in Sai Kung Peninsula from 6,000 years ago. Wong Tei Tung and Three Fathoms Cove are the two earliest sites of human habitation in the Paleolithic period. It is believed the Three Fathom Cove was a river valley settlement and Wong Tei Tung was a lithic manufacturing site. Excavated Neolithic artifacts suggest cultural differences from the Longshan culture in northern China and settlement by the Che people prior to the migration of the Baiyue. Eight petroglyphs were discovered on surrounding islands, which dated to the Shang Dynasty in China.

In 214 BC, Qin Shi Huang, the first emperor of China, conquered the Baiyue tribes in Jiaozhi (modern Liangguang region) and incorporated the territory into imperial China for the first time. Modern Hong Kong is located in Nanhai commandery (modern Nanhai District) and near the ancient capital city Panyu. The area was consolidated under the kingdom of Nanyue, founded by general Zhao Tuo in 204 BC after the Qin Dynasty collapsed. When the kingdom was conquered by Emperor Wu of Han in 111 BC, the land was assigned to the Jiaozhi commandery under the Han Dynasty. Archaeological evidence indicates the population increased and early salt production flourished in this time period. Lei Cheng Uk Han Tomb in the Kowloon Peninsula is believed to have been built during the Han Dynasty.

During the Tang Dynasty period, the Guangdong region flourished as a regional trading center. In 736, Emperor Xuanzong of Tang established a military town in Tuen Mun to defend the coastal area in the region. The first village school, Li Ying College, was established around 1075 in the New Territories under the Northern Song Dynasty. During the Mongol invasion in 1276, the Southern Song Dynasty court moved to Fujian, then to Lantau Island and later to Sung Wong Toi (modern Kowloon City), but the child Emperor Bing of Song committed suicide by drowning with his officials after being defeated in the Battle of Yamen. Hau Wong, an official of the emperor, is still worshipped in Hong Kong today.

The earliest recorded European visitor was Jorge Álvares, a Portuguese explorer who arrived in 1513. After establishing settlements in the region, Portuguese merchants began trading in southern China. At the same time, they invaded and built up military fortifications in Tuen Mun. Military clashes between China and Portugal led to the expulsion of the Portuguese. In the mid-16th century, the Haijin order banned maritime activities and prevented contact with foreigners; it also restricted local sea activity. In 1661–69, the territory was affected by the Great Clearance ordered by Kangxi Emperor, which required the evacuation of the coastal areas of Guangdong. It is recorded that about 16,000 persons from Xin'an County were driven inland, and 1,648 of those who left are said to have returned when the evacuation was rescinded in 1669. What is now the territory of Hong Kong became largely wasteland during the ban. In 1685, Kangxi became the first emperor to open limited trading with foreigners, which started with the Canton territory. He also imposed strict terms for trades such as requiring foreign traders to live in restricted areas, staying only for the trading seasons, banning firearms, and trading with silver only. The East India Company made the first sea venture to China in 1699, and the region's trade with British merchants developed rapidly soon after. In 1711, the company established its first trading post in Canton. By 1773, the British reached a landmark 1,000 chests of opium in Canton with China consuming 2,000 chests annually by 1799.

British colonial era
In 1839 the refusal by Qing Dynasty authorities to import opium resulted in the First Opium War between China and Britain. Hong Kong Island was occupied by British forces on 20 January 1841 and was initially ceded under the Convention of Chuenpee as part of a ceasefire agreement between Captain Charles Elliot and Governor Qishan, but the agreement was never ratified due to a dispute between high-ranking officials in both governments. It was not until 29 August 1842 that the island was formally ceded in perpetuity to the United Kingdom under the Treaty of Nanking. The British established a crown colony with the founding of Victoria City the following year.

When the union flag was raised over Possession Point on 26 January 1841, the population of Hong Kong island was about 7,450, mostly Tanka fishermen and Hakka charcoal burners living in a number of coastal villages.In the 1850s large numbers of Chinese would emigrate from China to Hong Kong due to the Taiping Rebellion. Other events such as floods, typhoons and famine in mainland China would also play a role in establishing Hong Kong as a place to escape the mayhem.

The establishment of the free port made Hong Kong a major entrepôt from the start, attracting people from China and Europe alike. The society remained racially segregated and polarised due to British colonial policies and attitudes. Despite the rise of a British-educated Chinese upper class by the late 19th century, race laws such as the Peak Reservation Ordinance prevented Chinese from living in elite areas like Victoria Peak. Politically, the majority Chinese population also had little to no official governmental influence throughout much of the early years. There were, however, a small number of Chinese elites that the British governors relied on, including Sir Kai Ho and Robert Hotung.They accepted their place in the Hong Kong hierarchy, and served as main communicators and mediators between the government and the Chinese population. Sir Kai Ho was an unofficial member of the Legislative Council. Robert Hotung wanted Chinese citizens to recognise Hong Kong as the new home after the fall of China's last dynasty in 1911. As a millionaire with financial influence, he emphasised that no part of the demographics was purely indigenous.

According to the census of 1865, Hong Kong had a population of 125,504, of which some 2,000 were Americans and Europeans. In 1914 despite an exodus of 60,000 Chinese fearing an attack on the colony during World War I, Hong Kong's population continued to increase from 530,000 in 1916 to 725,000 in 1925 and 1.6 million by 1941. In 1860 after China's defeat in the Second Opium War, the Kowloon Peninsula and Stonecutter's Island were ceded in perpetuity to Britain under the Convention of Peking. In 1894 the deadly Third Pandemic of bubonic plague spread from China to Hong Kong, causing 50,000–100,000 deaths.

In 1898 under the terms of the Convention for the Extension of Hong Kong Territory, Britain obtained a 99-year lease of Lantau Island and the adjacent northern lands, which became known as the New Territories. Hong Kong's territory has remained unchanged to the present. During the first half of the 20th century, Hong Kong was a free port, serving as an entrepôt of the British Empire. The British introduced an education system based on their own model, while the local Chinese population had little contact with the European community of wealthy tai-pans settled near Victoria Peak.

Japanese invasion
In conjunction with its military campaign, the Empire of Japan invaded Hong Kong on 8 December 1941. The Battle of Hong Kong ended with British and Canadian defenders surrendering control of the colony to Japan on 25 December. During the Japanese occupation of Hong Kong, civilians suffered widespread food shortages, rationing, and hyper-inflation due to forced exchange of currency for military notes. Through a policy of enforced repatriation of the unemployed to the mainland throughout the period, because of the scarcity of food, the population of Hong Kong had dwindled from 1.6 million in 1941 to 600,000 in 1945, when the United Kingdom resumed control of the colony.

Cold War era
Hong Kong's population recovered quickly as a wave of migrants from China arrived for refuge from the ongoing Chinese Civil War. When the PRC was proclaimed in 1949, more migrants fled to Hong Kong for fear of persecution by the Communist Party. Many corporations in Shanghai and Guangzhou shifted their operations to Hong Kong.

In the 1950s Hong Kong's rapid industrialization was driven by textile exports and other expanded manufacturing industries. As the population grew and labour costs remained low, living standards rose steadily. The construction of Shek Kip Mei Estate in 1953 followed a massive slum fire, and marked the beginning of the public housing estate programme designed to cope with the huge influx of immigrants. Trade in Hong Kong accelerated even further when Shenzhen, immediately north of Hong Kong, became a special economic zone of the PRC, and Hong Kong was established as the main source of foreign investment in China. The manufacturing competitiveness gradually declined in Hong Kong due to the development of the manufacturing industry in southern China beginning in the early 1980s. By contrast, the service industry in Hong Kong experienced high rates of growth in the 1980s and 1990s after absorbing workers released from the manufacturing industry.

Throughout the British colonial era, Hong Kong was industrialized and developed in all aspects from its economy to its health care system. Many health facilities were built for its citizens, such as the Queen Elizabeth Hospital, the Queen Mary Hospital, the Princess Margaret Hospital and the Prince of Wales Hospital. In 1983, when the United Kingdom reclassified Hong Kong from a British crown colony to a dependent territory, the governments of the United Kingdom and China were already discussing the issue of Hong Kong's sovereignty due to the impending expiration (within two decades) of the lease of the New Territories. In 1984 the Sino-British Joint Declaration – an agreement to transfer sovereignty to the People's Republic of China in 1997 – was signed. It stipulated that Hong Kong would be governed as a special administrative region, retaining its laws and a high degree of autonomy for at least 50 years after the transfer. The Hong Kong Basic Law, which is based on English law, would serve as the constitutional document after the transfer. It was ratified in 1990.

Since 1997
On 1 July 1997 the transfer of sovereignty from United Kingdom to the PRC occurred, officially ending 156 years of British colonial rule. Hong Kong became China's first special administrative region, and Tung Chee-Hwa took office as the first Chief Executive of Hong Kong. That same year, Hong Kong suffered an economic double blow from the Asian financial crisis and the H5N1 avian influenza. In 2003 Hong Kong was gravely affected by the outbreak of severe acute respiratory syndrome (SARS). The World Health Organization reported 1,755 infected and 299 deaths in Hong Kong. An estimated 380 million Hong Kong dollars (US$48.9 million) in contracts were lost as a result of the epidemic.

On 10 March 2005 Tung announced his resignation as Chief Executive due to "health problems". Donald Tsang, the Chief Secretary for Administration at the time, entered the 2005 election unopposed and became the second Chief Executive of Hong Kong on 21 June 2005. In 2007 Tsang won the Chief Executive election and continued his second term in office.

In 2009 Hong Kong hosted the fifth East Asian Games, in which nine national teams competed. It was the first and largest international multi-sport event ever held in the territory. Today, Hong Kong continues to serve as an important global financial centre but faces uncertainty over its future due to the growing mainland China economy and its relationship with the PRC government in areas such as democratic reform and universal suffrage.

Governance


Owing to its long history as a colony of the British Empire, Hong Kong is a city-state which continues to enjoy a high degree of autonomy even after its return to China. In accordance with the Sino-British Joint Declaration, and the underlying principle of one country, two systems, Hong Kong has a "high degree of autonomy as a special administrative region in all areas except defence and foreign affairs." The declaration stipulates that the region maintain its capitalist economic system and guarantees the rights and freedoms of its people for at least 50 years beyond the 1997 handover. The guarantees over the territory's autonomy and the individual rights and freedoms are enshrined in a constitution, the Hong Kong Basic Law (which is based on the Common law of England), which outlines the system of governance of the Hong Kong Special Administrative Region, but which is subject to the interpretation of the Standing Committee of the National People's Congress (NPCSC).

The primary pillars of government are the Executive Council, the civil service, the Legislative Council, and the Judiciary. The Executive Council is headed by the Chief Executive who is elected by the Election Committee and then appointed by the Central People's Government. The civil service is a politically neutral body that implements policies and provides government services, where public servants are appointed based on meritocracy. The Legislative Council has 60 members, half of whom are directly elected by universal suffrage by permanent residents of Hong Kong according to five geographical constituencies. The other half, known as functional constituencies, are directly elected by a smaller electorate, which consists of corporate bodies and persons from various stipulated functional sectors. The entire council is headed by the President of the Legislative Council who serves as the speaker. Judges are appointed by the Chief Executive on the recommendation of an independent commission.

The implementation of the Basic Law, including how and when the universal suffrage promised therein is to be achieved, has been a major issue of political debate since the transfer of sovereignty. In 2002, the government's proposed anti-subversion bill pursuant to Article 23 of the Basic Law, which required the enactment of laws prohibiting acts of treason and subversion against the Chinese government, was met with fierce opposition, and eventually shelved. Debate between pro-Beijing groups, which tend to support the Executive branch, and the Pan-democracy camp characterises Hong Kong's political scene, with the latter supporting a faster pace of democratisation, and the principle of one man, one vote.

In 2004 the government failed to gain pan-democrat support to pass its so-called "district council model" for political reform. In 2009, the government reissued the proposals as the "Consultation Document on the Methods for Selecting the Chief Executive and for Forming the LegCo in 2012". The document proposed the enlargement of the Election Committee, Hong Kong's electoral college, from 800 members to 1,200 in 2012 and expansion of the legislature from 60 to 70 seats. The ten new legislative seats would consist of five geographical constituency seats and five functional constituency seats, to be voted in by elected district council members from among themselves. The proposals were destined for rejection by pan-democrats once again, but a significant breakthrough occurred after the Central People's Government accepted a counter-proposal by the Democratic Party. In particular, the Pan-democracy camp was split when the proposal to directly elect five newly created functional seats was not acceptable to two constituent parties. The Democratic Party sided with the government for the first time since the handover and passed the proposals with a vote of 46–12.

Legal system and judiciary


Hong Kong's legal system is completely independent from the legal system of mainland China. In contrast to mainland China's civil law system, Hong Kong continues to follow the English Common Law tradition established under British rule. The essence of English common law is that it is made by judges sitting in courts, applying legal precedent (stare decisis) to the facts before them. For example, murder is a common law crime rather than one established by an Act of Parliament. Common law can be amended or repealed by Parliament; murder, for example, now carries a mandatory life sentence rather than the death penalty. According to Article 92 of the Basic Law, Hong Kong's courts may refer to decisions rendered by courts of other common law jurisdictions as precedents, and judges from other common law jurisdictions, most commonly England, Canada and Australia, are allowed to sit as non-permanent judges of the Court of Final Appeal.

Structurally, the court system consists of the Court of Final Appeal, the High Court, which is made up of the Court of Appeal and the Court of First Instance, and the District Court, which includes the Family Court. Other adjudicative bodies include the Lands Tribunal, the Magistrates' Courts, the Juvenile Court, the Coroner's Court, the Labour Tribunal, the Small Claims Tribunal, and the Obscene Articles Tribunal. Justices of the Court of Final Appeal are appointed by Hong Kong's Chief Executive. The Court of Final Appeal has the power of final adjudication with respect to the law of Hong Kong as well as the power of final interpretation over local laws including the power to strike down local ordinances on the grounds of inconsistency with the Basic Law

The Department of Justice is responsible for handling legal matters for the government. Its responsibilities include providing legal advice, criminal prosecution, civil representation, legal and policy drafting and reform, and international legal cooperation between different jurisdictions. Apart from prosecuting criminal cases, lawyers of the Department of Justice act on behalf of the government in all civil and administrative lawsuits against the government. As protector of the public interest, the department may apply for judicial reviews and may intervene in any cases involving the greater public interest. The Basic Law protects the Department of Justice from any interference by the government when exercising its control over criminal prosecution.

Human rights
Hong Kong's Basic law is based on the English law and so in general, Hong Kong is perceived to enjoy a high level of civil liberties. The Hong Kong government generally respects the human rights of its citizens, although core issues remain. There are concerns over the freedom of assembly which is restricted by the Public Order Ordinance. The police has been occasionally accused of using heavy-handed tactics towards protestors and questions are asked towards the extensive powers of the police. As to the right of privacy, covert surveillance remains the major concern. There is a lack of protection for gay men and lesbians due to the absence of a sexual orientation discrimination law, though there are currently no laws that criminalize homosexuality per se. There are also comments regarding a lack of protection for labour rights.

Internet censorship in Hong Kong operates under different principles and regulations from those of mainland China.

Administrative districts
Hong Kong has a unitary system of government; no local government has existed since the two municipal councils were abolished in 2000. As such there is no formal definition for its cities and towns. Administratively, Hong Kong is subdivided into 18 geographic districts, each represented by a district council which advises the government on local matters such as public facilities, community programmes, cultural activities, and environmental improvements.

There are a total of 534 district council seats, 405 of which are elected; the rest are appointed by the Chief Executive and 27 ex officio chairmen of rural committees. The Home Affairs Department communicates government policies and plans to the public through the district offices.

Military
When Hong Kong was a British colony and later, a dependent territory, defence was provided by the British military under the command of the Governor of Hong Kong who was ex officio Commander-in-chief. When the PRC assumed sovereignty in 1997 the British barracks were replaced by a garrison of the People's Liberation Army, comprising ground, naval, and air forces, and under the command of the Chinese Central Military Commission. The Hong Kong Basic Law protects local civil affairs against interference by the garrison, and members of the garrison are subject to Hong Kong laws. The Hong Kong Government remains responsible for the maintenance of public order; however, it may ask the PRC government for help from the garrison in maintaining public order and in disaster relief. The PRC government is responsible for the costs of maintaining the garrison.

Geography and climate
Hong Kong is located on China's south coast, 60 km east of Macau on the opposite side of the Pearl River Delta. It is surrounded by the South China Sea on the east, south, and west, and borders the Guangdong city of Shenzhen to the north over the Shenzhen River. The territory's 1104 km2 area consists of Hong Kong Island, the Kowloon Peninsula, the New Territories, and over 200 offshore islands, of which the largest is Lantau Island. Of the total area, 1054 km2 is land and 50 km2 is inland water. Hong Kong claims territorial waters to a distance of 3 nmi. Its land area makes Hong Kong the 179th largest inhabited territory in the world.

As much of Hong Kong's terrain is hilly to mountainous with steep slopes, less than 25% of the territory's landmass is developed, and about 40% of the remaining land area is reserved as country parks and nature reserves. Most of the territory's urban development exists on Kowloon peninsula, along the northern edge of Hong Kong Island, and in scattered settlements throughout the New Territories. The highest elevation in the territory is at Tai Mo Shan, 957 m above sea level. Hong Kong's long and irregular coast provides it with many bays, rivers and beaches. On 18 September 2011, UNESCO listed the Hong Kong National Geopark as part of its Global Geoparks Network. Hong Kong Geopark is made up of eight Geo-Areas distributed across the Sai Kung Volcanic Rock Region and Northeast New Territories Sedimentary Rock Region.

Despite Hong Kong's reputation of being intensely urbanised, the territory has tried to promote a green environment, and recent growing public concern has prompted the severe restriction of further land reclamation from Victoria Harbour. Awareness of the environment is growing as Hong Kong suffers from increasing pollution compounded by its geography and tall buildings. Approximately 80% of the city's smog originates from other parts of the Pearl River Delta.

Though it is situated just south of the Tropic of Cancer, Hong Kong has a humid subtropical climate (Köppen Cwa). Summer is hot and humid with occasional showers and thunderstorms, and warm air coming from the southwest. Summer is when typhoons are most likely, sometimes resulting in flooding or landslides. Winters are mild and usually start sunny, becoming cloudier towards February; the occasional cold front brings strong, cooling winds from the north. The most temperate seasons are spring, which can be changeable, and autumn, which is generally sunny and dry. Hong Kong averages 1,948 hours of sunshine per year, while the highest and lowest ever recorded temperatures at the Hong Kong Observatory are 36.1 °C and 0.0 °C, respectively.

Economy


As one of the world's leading international financial centres, Hong Kong has a major capitalist service economy characterised by low taxation and free trade. The currency, Hong Kong dollar, is the eighth most traded currency in the world as of 2010. Hong Kong was once described by Milton Friedman as the world's greatest experiment in laissez-faire capitalism, but has since instituted a regime of regulations including a minimum wage. It maintains a highly developed capitalist economy, ranked the freest in the world by the Index of Economic Freedom every year since 1995. It is an important centre for international finance and trade, with one of the greatest concentrations of corporate headquarters in the Asia-Pacific region, and is known as one of the Four Asian Tigers for its high growth rates and rapid development from the 1960s to the 1990s. Between 1961 and 1997 Hong Kong's gross domestic product grew 180 times while per-capita GDP increased 87 times over.

The Hong Kong Stock Exchange is the seventh largest in the world, with a market capitalisation of US$2.3 trillion as of December 2009. In that year, Hong Kong raised 22 percent of worldwide initial public offering (IPO) capital, making it the largest centre of IPOs in the world and the easiest place to raise capital. The Hong Kong dollar has been pegged to the U.S. dollar since 1983.

The Hong Kong Government has traditionally played a mostly passive role in the economy, with little by way of industrial policy and almost no import or export controls. Market forces and the private sector were allowed to determine practical development. Under the official policy of "positive non-interventionism", Hong Kong is often cited as an example of laissez-faire capitalism. Following the Second World War, Hong Kong industrialised rapidly as a manufacturing centre driven by exports, and then underwent a rapid transition to a service-based economy in the 1980s. Since then, it has grown to become a leading center for management, financial, IT, business consultation and professional services.

Hong Kong matured to become a financial centre in the 1990s, but was greatly affected by the Asian financial crisis in 1998, and again in 2003 by the SARS outbreak. A revival of external and domestic demand has led to a strong recovery, as cost decreases strengthened the competitiveness of Hong Kong exports and a long deflationary period ended. Government intervention, initiated by the later colonial governments and continued since 1997, has steadily increased, with the introduction of export credit guarantees, a compulsory pension scheme, a minimum wage, anti-discrimination laws, and a state mortgage backer.

The territory has little arable land and few natural resources, so it imports most of its food and raw materials. Imports account for more than 90% of Hong Kong's food supply, including nearly all of the meat and rice available there. Agricultural activity—relatively unimportant to Hong Kong's economy and contributing just 0.1% of its GDP—primarily consists of growing premium food and flower varieties. Hong Kong is the world's eleventh largest trading entity, with the total value of imports and exports exceeding its gross domestic product. It is the world's largest re-export centre. Much of Hong Kong's exports consist of re-exports, which are products made outside of the territory, especially in mainland China, and distributed via Hong Kong. Its physical location has allowed the city to establish a transportation and logistics infrastructure that includes the world's second busiest container port and the world's busiest airport for international cargo. Even before the transfer of sovereignty, Hong Kong had established extensive trade and investment ties with the mainland, which now enable it to serve as a point of entry for investment flowing into the mainland. At the end of 2007, there were 3.46 million people employed full-time, with the unemployment rate averaging 4.1% for the fourth straight year of decline. Hong Kong's economy is dominated by the service sector, which accounts for over 90% of its GDP, while industry constitutes 9%. Inflation was at 2.5% in 2007. Hong Kong's largest export markets are mainland China, the United States, and Japan.

As of 2010 Hong Kong is the eighth most expensive city for expatriates, falling from fifth position in the previous year. Hong Kong is ranked fourth in terms of the highest percentage of millionaire households, behind Switzerland, Qatar, and Singapore with 8.5 percent of all households owning at least one million US dollars. In 2011, Hong Kong was ranked second in the Ease of Doing Business Index, behind Singapore.

Infrastructure
Hong Kong's transportation network is highly developed. Over 90% of daily travels (11 million) are on public transport, the highest such percentage in the world. Payment can be made using the Octopus card, a stored value system introduced by the Mass Transit Railway (MTR), which is widely accepted on railways, buses and ferries, and accepted like cash at other outlets.

The city's main railway company (KCRC) was merged with MTR in 2007, creating a comprehensive rail network for the whole territory (also called MTR). This MTR rapid transit system has 152 stations, which serve 3.4 million people a day. Hong Kong Tramways, which has served the territory since 1904, covers the northern parts of Hong Kong Island.

Hong Kong's bus service is franchised and run by private operators. Five privately owned companies provide franchised bus service across the territory, together operating more than 700 routes. The two largest, Kowloon Motor Bus provides 402 routes in Kowloon and New Territories; Citybus operates 154 routes on Hong Kong Island; both run cross-harbour services. Double-decker buses were introduced to Hong Kong in 1949, and are now almost exclusively used; single-decker buses remain in use for routes with lower demand or roads with lower load capacity. Public light buses serve most parts of Hong Kong, particularly areas where standard bus lines cannot reach or do not reach as frequently, quickly, or directly.

The Star Ferry service, founded in 1888, operates two lines across Victoria Harbour and provides scenic views of Hong Kong's skyline for its 53,000 daily passengers. It acquired iconic status following its use as a setting on The World of Suzie Wong. Travel writer Ryan Levitt considered the main Tsim Sha Tsui to Central crossing one of the most picturesque in the world. Other ferry services are provided by operators serving outlying islands, new towns, Macau, and cities in mainland China. Hong Kong is famous for its junks traversing the harbour, and small kai-to ferries that serve remote coastal settlements. The Port of Hong Kong is a busy deepwater port, specialising in container shipping.

Hong Kong Island's steep, hilly terrain was initially served by sedan chairs. The Peak Tram, the first public transport system in Hong Kong, has provided vertical rail transport between Central and Victoria Peak since 1888. In Central and Western district, there is an extensive system of escalators and moving pavements, including the longest outdoor covered escalator system in the world, the Mid-Levels escalator.

Hong Kong International Airport is a leading air passenger gateway and logistics hub in Asia and one of the world's busiest airports in terms of international passenger and cargo movement, serving more than 47 million passengers and handling 3.74 million tonnes (4.12 million tons) of cargo in 2007. It replaced the overcrowded Kai Tak Airport in Kowloon in 1998, and has been rated as the world's best airport in a number of surveys. Over 85 airlines operate at the two-terminal airport and it is the primary hub of Cathay Pacific, Dragonair, Air Hong Kong, Hong Kong Airlines, and Hong Kong Express.

Demographics
The territory's population in 2011 is 7.07 million, with an average annual growth rate of 0.6% over the previous five years. Residents from mainland China do not have the right of abode in Hong Kong, nor are they allowed to enter the territory freely. However, the influx of immigrants from mainland China, approximating 45,000 per year, is a significant contributor to its population growth – a daily quota of 150 Mainland Chinese with family ties in Hong Kong are granted a "one way permit". Life expectancy in Hong Kong is 79.16 years for males and 84.79 years for females as of 2009, making it one of the highest life expectancies in the world.

About 93.6% of the people of Hong Kong are of Chinese descent, the majority of whom are Taishanese, Chiu Chow, other Cantonese people, and Hakka. Hong Kong's Han majority originate mainly from the Guangzhou and Taishan regions in Guangdong province. The remaining 6.4% of the population is composed of non-ethnic Chinese. There is a South Asian population of Indians, Pakistanis and Nepalese; some Vietnamese refugees have become permanent residents of Hong Kong. There are also Britons, Americans, Canadians, Japanese, and Koreans working in the city's commercial and financial sector. In 2008, there were an estimate of 252,500 foreign domestic helpers from Indonesia and the Philippines working in Hong Kong.

Hong Kong's de facto official language is Cantonese, a Chinese language originating from Guangdong province to the north of Hong Kong. English is also an official language, and according to a 1996 by-census is spoken by 3.1 percent of the population as an everyday language and by 34.9 percent of the population as a second language. Signs displaying both Chinese and English are common throughout the territory. Since the 1997 handover, an increase in immigrants from mainland China and greater integration with the mainland economy have brought an increasing number of Mandarin speakers to Hong Kong.

A majority of residents of Hong Kong would claim no religious affiliation, professing a form of agnosticism or atheism. According to the U.S Department of State only 43 percent of the population practices some form of religion. Some figures put it higher, according to a Gallup poll, 64% of Hong Kong residents do not believe in any religion, and possibly 80% of Hong Kong claim no religion. In Hong Kong teaching evolution won out in curriculum dispute about whether to teach other explanations, and that creationism and intelligent design will form no part of the senior secondary biology curriculum.

Hong Kong enjoys a high degree of religious freedom, guaranteed by the Basic Law. Hong Kong's main religions are Buddhism, Taoism and Confucianism; a local religious scholar in contact with major denominations estimates there are approximately 1.5 million Buddhists and Taoists. A Christian community of around 833,000 forms about 11.7% of the total population; Protestants forms a larger number than Roman Catholics at a rate of 4:3, although smaller Christian communities exist, including the Latter-Day Saints and Jehovah's Witnesses. The Anglican and Roman Catholic churches each freely appoint their own bishops, unlike in mainland China. There are also Sikh, Muslim, Jewish, Hindu and Bahá'í communities. The practice of Falun Gong is tolerated.

Statistically Hong Kong's income gap is the greatest in Asia Pacific. According to a report by the United Nations Human Settlements Programme in 2008, Hong Kong's Gini coefficient, at 0.53, was the highest in Asia and "relatively high by international standards". However, the government has stressed that income disparity does not equate to worsening of the poverty situation, and that the Gini coefficient is not strictly comparable between regions. The government has named economic restructuring, changes in household sizes, and the increase of high-income jobs as factors that have skewed the Gini coefficient.

Education
Hong Kong's education system used to roughly follow the system in England, although international systems exist. The government maintains a policy of "mother tongue instruction" in which the medium of instruction is Cantonese, with written Chinese and English. In secondary schools, 'biliterate and trilingual' proficiency is emphasised, and Mandarin-language education has been increasing. The Programme for International Student Assessment ranked Hong Kong's education system as the second best in the world. Hong Kong's public schools are operated by the Education Bureau. The system features a non-compulsory three-year kindergarten, followed by a compulsory six-year primary education, a compulsory three-year junior secondary education, a non-compulsory two-year senior secondary education leading to the Hong Kong Certificate of Education Examinations and a two-year matriculation course leading to the Hong Kong Advanced Level Examinations. The New Senior Secondary academic structure and curriculum was implemented in September 2009, which provides for all students to receive three years of compulsory junior and three years of compulsory senior secondary education. Under the new curriculum, there is only one public examination, namely the Hong Kong Diploma of Secondary Education.

Most comprehensive schools in Hong Kong fall under three categories: the rarer public schools; the more common subsidised schools, including government aids-and-grant schools; and private schools, often run by Christian organisations and having admissions based on academic merit rather than on financial resources. Outside this system are the schools under the Direct Subsidy Scheme and private international schools.

There are eight public and one private universities in Hong Kong with the University of Hong Kong (HKU) being the oldest which was established in 1910-1912. Competition among students to receive an offer for an undergraduate program is fierce as the annual number of intakes is limited, especially when some disciplines are just offered by some of those tertiary institutions, like medicine which is provided by merely two medical schools in the territory, the Li Ka Shing Faculty of Medicine owned by the University of Hong Kong and the Faculty of Medicine of the The Chinese University of Hong Kong. Besides, there is also a number of private higher institutions which offer higher diplomas and associate degree courses for those who fail to enter a college for a degree study so as to boost their qualification of education, some of whom can have a second chance of getting into a university if they have a good performance in these sub-degree courses.

Health
There are 13 private hospitals and more than 40 public hospitals in Hong Kong. There is little interaction between public and private healthcare. The hospitals offer a wide range of healthcare services, and some of the territory's private hospitals are considered to be world class. According to UN estimates, Hong Kong has one of the longest life expectancy of any country or territory in the world. As of 2012, Hong Kong women are the longest living demographic group in the world.

There are two medical schools in the territory, one based at the Chinese University of Hong Kong and the other at Hong Kong University. Both have links with public sector hospitals. With respect to postgraduate education, traditionally many doctors in Hong Kong have looked overseas for further training, and many took British Royal College exams such as the MRCP(UK) and the MRCS(UK). However, Hong Kong has been developing its own postgraduate medical institutions, in particular the Hong Kong Academy of Medicine, and this is gradually taking over the responsibility for all postgraduate medical training in the territory.

By 2011, there have been growing concerns that mothers-to-be from mainland China, in a bid to obtain the right of abode in Hong Kong and the benefits that come with it, have saturated the neonatal wards of the city's hospitals, both public and private sectors, which has led to outcries and protests from local pregnant women for the government to remedy the issue, as they have found difficulty securing a bed space for giving birth and arrange routine check-ups. Other concerns in the decade of 2001–2010 relate to the workload medical staff experience; and medical errors and mishaps, which are frequently highlighted in local news.

Culture
Hong Kong is frequently described as a place where "East meets West", reflecting the culture's mix of the territory's Chinese roots with influences from its time as a British colony. Concepts like feng shui are taken very seriously, with expensive construction projects often hiring expert consultants, and are often believed to make or break a business. Other objects like Ba gua mirrors are still regularly used to deflect evil spirits, and buildings often lack any floor number that has a 4 in it, due to its similarity to the word for "die" in Cantonese. The fusion of east and west also characterises Hong Kong's cuisine, where dim sum, hot pot, and fast food restaurants coexist with haute cuisine.

Hong Kong is a recognised global centre of trade, and calls itself an "entertainment hub". Its martial arts film genre gained a high level of popularity in the late 1960s and 1970s. Several Hollywood performers, notable actors and martial artists have originated from Hong Kong cinema, notably Bruce Lee, Jackie Chan, Chow Yun-fat, Michelle Yeoh, Maggie Cheung and Jet Li. A number of Hong Kong film-makers have achieved widespread fame in Hollywood, such as John Woo, Wong Kar-wai, and Stephen Chow. Homegrown films such as Chungking Express, Infernal Affairs, Shaolin Soccer, Rumble in the Bronx, In the Mood for Love and Echoes of the Rainbow have gained international recognition. Hong Kong is the centre for Cantopop music, which draws its influence from other forms of Chinese music and Western genres, and has a multinational fanbase.

The Hong Kong government supports cultural institutions such as the Hong Kong Heritage Museum, the Hong Kong Museum of Art, the Hong Kong Academy for Performing Arts, and the Hong Kong Philharmonic Orchestra. The government's Leisure and Cultural Services Department subsidises and sponsors international performers brought to Hong Kong. Many international cultural activities are organised by the government, consulates, and privately.

Hong Kong has two licensed terrestrial broadcasters – ATV and TVB. There are three local and a number of foreign suppliers of cable and satellite services. The production of Hong Kong's soap dramas, comedy series, and variety shows reach audiences throughout the Chinese-speaking world. Magazine and newspaper publishers in Hong Kong distribute and print in both Chinese and English, with a focus on sensationalism and celebrity gossip. The media in Hong Kong is relatively free from official interference compared to Mainland China, although the Far Eastern Economic Review points to signs of self-censorship by media whose owners have close ties to or business interests in the People's Republic of China and states that even Western media outlets are not immune to growing Chinese economic power.

Hong Kong offers wide recreational and competitive sport opportunities despite its limited land area. It sends delegates to international competitions such as the Olympic Games and Asian Games, and played host to the equestrian events during the 2008 Summer Olympics. There are major multipurpose venues like Hong Kong Coliseum and MacPherson Stadium. Hong Kong's steep terrain and extensive trail network with expansive views attracts hikers, and its rugged coastline provides many beaches for swimming.

Sport
Sports in Hong Kong are a significant part of its culture. Due mainly to British influence going as far back as the late 19th century, Hong Kong had an earlier introduction to Western athletics compared to other Asia regions. Football, basketball, swimming, badminton, table tennis, cycling and running have the most participants and spectators. In 2009, Hong Kong successfully organized the V East Asian Games and was the biggest sporting event ever held in the territory. Other major international sporting events including the Equestrian at the 2008 Summer Olympics, Hong Kong Sevens, Hong Kong Marathon, AFC Asian Cup, EAFF East Asian Cup, Hong Kong Tennis Classic, Premier League Asia Trophy, and Lunar New Year Cup. Hong Kong athletes over see improved, as of 2010, there are 32 Hong Kong athletes from seven sports ranking in world's Top 20, 29 athletes in six sports in Asia top 10 ranking. Moreover, Hong Kong is equally impressive performance of athletes with disabilities in 2009, having won four world championships and two Asian Champions.

Architecture
According to Emporis, there are 1,223 skyscrapers in Hong Kong, which puts the city at the top of world rankings. It has more buildings higher than 500 ft (or 150m) than any other city. The high density and tall skyline of Hong Kong's urban area is due to a lack of available sprawl space, with the average distance from the harbour front to the steep hills of Hong Kong Island at 1.3 km, much of it reclaimed land. This lack of space causes demand for dense, high-rise offices and housing. Thirty-six of the world's 100 tallest residential buildings are in Hong Kong. More people in Hong Kong live or work above the 14th floor than anywhere else on Earth, making it the world's most vertical city.

As a result of the lack of space and demand for construction, few older buildings remain, and the city is becoming a centre for modern architecture. The International Commerce Centre (ICC), at 484 m high, is the tallest building in Hong Kong and the third tallest in the world, by height to roof measurement. The tallest building prior to the ICC is Two International Finance Centre, at 415 m high. Other recognisable skyline features include the HSBC Headquarters Building, the triangular-topped Central Plaza with its pyramid-shaped spire, The Center with its night-time multi-coloured neon light show; A Symphony of Lights and I. M. Pei's Bank of China Tower with its sharp, angular façade. According to the Emporis website, the city skyline has the biggest visual impact of all world cities. Also, Hong Kong's skyline is often regarded to be the best in the world, with the surrounding mountains and Victoria Harbour complementing the skyscrapers. Most of the oldest remaining historic structures, including the Tsim Sha Tsui Clock Tower, the Central Police Station, and the remains of Kowloon Walled City were constructed during the 19th and early 20th centuries.

There are many development plans in place, including the construction of new government buildings, waterfront redevelopment in Central, and a series of projects in West Kowloon. More high-rise development is set to take place on the other side of Victoria Harbour in Kowloon, as the 1998 closure of the nearby Kai Tak Airport lifted strict height restrictions.