The Post-war Years

After the Japanese surrender, Chinese civilians - many of whom had
moved into China during the war - returned at the rate of almost 100 000
a month. The population, which by August 1945 had been reduced to
about 600 000, rose by the end of 1947 to an estimated 1.8 million. In
1948-49, as the forces of the Chinese Nationalist Government began to
face defeat in civil war at the hands of the communists, Hong Kong
received an influx unparalleled in its history. Hundreds of thousands of
people - mainly from Kwangtung (Guangdong) Province, Shanghai and
other commercial centres - entered Hong Kong during 1949 and the
spring of 1950. By mid-1950, the population had swelled to an estimated
2.2 million. It has continued to rise and is now over 6.5 million.

After a period of economic stagnation caused by the United Nations'
embargo on trade with China, Hong Kong began to industrialise. No
longer could Hong Kong rely solely on its port to provide prosperity for its
greatly increased population. From the start, the industrial revolution was
based on cotton textiles, gradually adding woollens to the list and, in the
late 1960s, man-made fibres and made-up garments. The share of total
exports held by textiles and clothing reached was more than 51 per cent
of domestic exports by value during the 1960s. This share has declined
over the years but they still constitute about 38 per cent. Electronic
products, watches and clocks, and printing are also important industries.

Associated with events in China, 1966 saw mounting tension in Hong
Kong. During 1967, this developed into a series of civil disturbances,
affecting all aspects of life and temporarily paralysing the economy. But,
by the year's end, the disturbances were contained and the community
continued its tradition of peaceful progress.

Hong Kong continued to expand its role as an entrep矌 with its neighbours
and trade with China was no exception. Coupled with tourism, this led to
vast improvements in communications, with an increasing number of
people entering China from or through Hong Kong, a natural gateway,
each year. One of Hong Kong's carriers, Hong Kong Dragon Airlines, and
six Chinese airlines - China Southern Airlines, Air China, China Eastern
Airlines, China Southwest Airlines, China Northern Airlines and China
Northwest Airlines - operate more than 700 flight movements a week in
scheduled and non-scheduled services between Hong Kong and 40
destinations in China.

The Kowloon-Canton Railway Corporation runs, jointly with the
Guangzhou Railway (Group) Corporation, four 'through' trains to
Guangzhou, two of which stop at Changping, and one train daily to
Zhaoqing which stops at Foshan. Trains to Shanghai and Beijing also
operate on alternate days. Direct bus services operate different routes into
Guangdong and other parts of southern China. Daily ferry services run to
Guangzhou and other ports in South China.

To keep pace with the development, the government places strong
emphasis on improving and expanding infrastructure. As a result, Hong
Kong has been transformed into a modern city with efficient road and rail
links, tunnels and flyovers. New highways have opened up previously
remote areas.

The development of Hong Kong's economic base has enabled the public
sector to increase spending on housing, education, social welfare and
health over the years - from $24.34 billion in 1987/88 to an estimated
$126.87 billion in 1997/98.

Hong Kong's public housing programme started with an emergency
measure to rehouse some 53 000 people made homeless overnight in a
squatter fire in 1953. It has developed into a comprehensive programme
which encompasses a wide range of rental and home ownership scheme
flats with self-contained facilities. More than half of Hong Kong's families
live in accommodation which they own.

The programme is in line with a long-term strategy to produce new
housing and to meet outstanding demand, and to encourage home
ownership in the community. The Hong Kong Housing Authority, with
primary responsibility for this programme, plans to build some 198 345
flats in the next three years 1998/1999-2000/2001.

Expenditure on education facilities and improvements has always been a
major budget consideration. There are now free and compulsory primary
and junior secondary school places for every student up to the age of 15
years. In 1997, the government subsidised Secondary 4 places for about
81 per cent of the 15-year-olds in a continuing programme.

Major social welfare advances have been made by the government and
non-governmental organisations in the past decade, with expenditure
increasing from $2.82 billion in 1987/88 to $19.04 billion during 1997/98.

Medical and health services are also undergoing vigorous development
programmes which will provide four more major public hospitals (i.e.
North District Hospital, Kowloon Medical Rehabilitation Centre, Tseung
Kwan O Hospital and Lai King Hospital) and some five additional clinics
and polyclinics over the next five years.

A comprehensive system of labour legislation has been developed to
provide for employees' benefits and protection, work injury
compensation, work safety and occupational health. Free employment
services are provided to help job-seekers find jobs and employers recruit
staff. The Employees Retraining Board equips workers displaced in the
economic restructuring with new skills for alternative employment.

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