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Hong Kong`s Free Economy: At the Crossroads? |
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ABSTRACT |
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| The case discusses the challenges faced by Hong Kong, touted as the freest economy in the world, due to the interference and restrictions imposed by China. Hong Kong achieved the position of being the freest economy due to its low tariffs, high amounts of trade (FDI flows), efficient regulations, and low government intervention. Despite the difficulties during the regional and global economic slowdown, Hong Kong fared well, and it remained one of the most open, most welcoming, and freest economies in the world. Hong Kong’s rule of law, together with the independent judiciary and the transparency of its legal system, reassured companies seeking to set up their businesses in the city. At the same time, Hong Kong was ranked as one of the most expensive cities in the Cost of Living survey, with the widest income inequalities in the developed world. Being a global financial and shipping center, Hong Kong’s economic linkage with the mainland was most evident in the finance and trading sectors. As the Asian economy continued to grow along with China’s economy, it was expected that there would be more opportunities for Hong Kong in the financial services sector, where it was well positioned as one of the largest finance hubs in the world. But, the mainland’s continuing interference despite its “One Country, Two Systems” pledge, was a cause for concern for the citizens of Hong Kong. China’s heavy-handedness with Hong Kong spurred tension in the city and citizens complained about the deteriorating rule of law and human rights environment. This raised several questions – in the absence of political freedom, can Hong Kong remain the freest economy in the world? Will the Hong Kong free market model with wealth disparities survive in the long run? Should Hong Kong give up its capitalist economy on which its prosperity was built? . |
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PayPal (11 USD)
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Issues |
| The case is structured to achieve the following teaching objectives: |
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- Understand the traits of a free economy
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- Examine the hindrances to a free economy
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- Analyze the factors leading to a free economy.
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- Examine whether a free economy can be really free with internal disturbances and external interference
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- Get to know the challenges in preserving the free economy in the wake of risks these economies face from different directions
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Keywords |
| Hong Kong,Free Economy,Free-enterprise economy,Service-oriented economy,Economic freedom index,Global competitiveness index,Laissez-faire capitalism,Rule of law,Civil liberty,Sovereignty |
INTRODUCTION
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