Portal:Business and economics/Selected economy/August 2007
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The Economy of Hong Kong is widely believed to be the most economically free in the world. It has often been cited by economists such as Milton Friedman and the Cato Institute as an example of the benefits of laissez-faire capitalism. While the government, both under British and PRC rule, has occasionally intervened in the economy, the free market policy of Positive non-interventionism espoused by former financial secretary John James Cowperthwaite still largely drives economic policy today. It has ranked as the world's freest economy in the Index of Economic Freedom for 13 consecutive years, since the inception of the index in 1995. It also places first in the Economic Freedom of the World Report.
No official GDP was measured by the government until 1971. Any GDP formed prior to this period was based on international trade statistics that came after 1971. This is a chart of trend of real gross domestic product of Hong Kong at constant market prices by the International Monetary Fund with figures in millions of Hong Kong Dollars. In 2006, Hong Kong's GDP ranked as the 40th highest in the world at US$253.1 billion. Its per-capita GDP ranked as the 15th highest at US$36,500, notably ahead of countries such as Canada, Japan, Switzerland, and the United Kingdom, and still well ahead of the People's Republic of China. The very center of Hong Kong's economic freedom comes from the government's hands-off policy. This model was developed in Hong Kong and Taiwan as a response to analyzing the cultural revolution affect in China. The Maoist era forecasted the production of steel, and the inability to produce led to the immediate collapse of the economy. Hong Kong's model allowed for the flexibility and renovation of any given industry in a very short time. Because of this, a 1994 World Bank report stated that Hong Kong's GDP per capita grew in real terms at an annual rate of 6.5% from 1965 to 1989. This consistent growth percentage over a span of almost 25 years is remarkable for any economic analysis. By 1990 Hong Kong's per capita income officially surpassed that of the ruling United Kingdom.
