Ground breaking: Chief Executive Donald Tsang presents his 2009-10 Policy Address to the Legislative Council.

In his Policy Address to the Legislative Council today, Chief Executive Donald Tsang has set out strategies for Hong Kong's economic development and sustainable growth, and laid out his vision to improve the city's quality of life.  

"We are entering a new era, but we need not worry about the new competitive landscape.  With an open mind, pioneering spirit, and full preparation, we can break new ground together," he said.

The global economic crisis had underscored the need for Hong Kong to diversify its economic base in areas that complemented the traditional pillar industries of financial services, tourism, trade and logistics and professional services.

He announced new initiatives to develop six industries where Hong Kong enjoys clear advantages: education services, medical services, testing and certification services, environmental industries, innovation and technology, and cultural and creative industries. This included measures to encourage owners of more than 1,000 old industrial buildings to revitalise or convert them for use by the six industries.

"With appropriate policies to remove obstacles to their development, the six industries will enter a new phase of development, propelling Hong Kong towards a knowledge-based economy," Mr Tsang said.

He also set out his vision to enhance Central's appeal as a vibrant district for business and entertainment - by opening up public space at the Central Ferry Piers, converting the Central Market into an 'urban oasis', preserving the Central Government Offices Main and East Wings, implementing the Central Police Station project, and the development of a creative industries cluster on the original site of the Central School.

Taking into account the special style of the Murray Building and its premium location, Mr Tsang said he recommends converting it into a hotel through open tender.

"The idea of conserving Central is premised on our respect for the history of the district," he said.

"We endeavour to strike a balance between protecting the environment and providing quality space, which is a growing public concern, and relieving the shortage of office space in the city centre."       

Mr Tsang identified several new challenges for Hong Kong including promoting stronger regional co-operation and maintaining Hong Kong's status as a global financial centre. He said Hong Kong should collaborate with Shanghai in developing the country's financial-services industry, adding that competition between the two cities was not a "zero-sum game".

"As a prime global financial centre in the Asian time zone, Hong Kong enjoys many advantages, including a highly open and internationalised market, a regulatory regime aligned with major overseas markets, the rule of law, and the free flow of information and capital," Mr Tsang said.

To promote Hong Kong-Taiwan co-operation, Mr Tsang said a Hong Kong-Taiwan Economic & Cultural Co-operation & Promotion Council would be established, along with a multi-functional office in Taiwan.

He also said Hong Kong would strengthen co-operation with Guangdong Province under the Outline of the Plan for the Reform & Development of the Pearl River Delta announced in January.

Identifying family values and elderly care as cornerstones of a progressive society, the Chief Executive pledged to provide additional support for vulnerable members of the community.

The Family Council would launch a Happy Family Campaign to promote core family values and encourage the public to build a happy family environment. This would help tackle social problems such as youth drug abuse, prostitution and neglect of children and the elderly.

On democratic reform, Mr Tsang urged people to focus on the need to amend the electoral methods for electing the Chief Executive and forming the Legislative Council in 2012. The Government will begin an extensive public consultation on the issue in November.

The Chief Executive encouraged people to rally behind Hong Kong's staging of the East Asian Games in December. The games' success, he said, "will be assured by the full participation of the community and our will to 'Be the Legend'."