JUNE 28 - JULY 5, 2022
New term government takes office
Chief Executive John Lee and principal officials of the sixth-term Hong Kong Special Administrative Region (HKSAR) Government sworn in at the inaugural ceremony (Jul 1), attended by President Xi Jinping and about 1,300 guests. The Chief Executive highlighted that the principle of “One Country, Two Systems” is the institutional safeguard of Hong Kong and the cornerstone of maintaining Hong Kong’s long-term prosperity and stability. He will strive to comprehensively and accurately implement the principles of "One Country, Two Systems", "Hong Kong people administering Hong Kong" and a high degree of autonomy, to safeguard the constitutional order of the HKSAR. The government will also work to enhance Hong Kong’s competitiveness and develop the economy. Apart from strengthening its established sectors and reinforcing the city’s status as an international financial, transportation and trading center, the government will also strive to fully develop a range of emerging industries under the National 14th Five-Year Plan, including an international innovation and technology hub; an East meets West center for international cultural exchange, and new developments to tackle social issues such as land and housing. 
Swap Connect to launch in 6 months
The People’s Bank of China, the Securities and Futures Commission and the Hong Kong Monetary Authority (HKMA) jointly announced (Jul 4) their approval for the specified Mainland and Hong Kong financial institutions to collaborate in establishing mutual access arrangements between the interest rate swap markets of the two places. To officially launch in six months, the Swap Connect program will start with northbound trading in the initial phase, allowing Hong Kong and overseas investors to participate in the Mainland’s interbank derivatives market through arrangements in trading, clearing, and settlement between specified institutions in Hong Kong and the Mainland. HKMA Chief Executive Eddie Yu said the Swap Connect will create synergy with Bond Connect to facilitate global investors’ management of interest rate risks for their bond investment on the Mainland, adding to the depth and breadth of the opening-up of the Mainland financial markets. Welcoming the announcement, the HKSAR Government said the Swap Connect marks another milestone in the integration of the Mainland and Hong Kong financial markets. It will, for the first time, introduce mutual access in the realm of financial derivatives products, enhancing the comprehensiveness of the product suit trading under the mutual market access schemes.
May retail sales turned mild
The value of retail sales in May, provisionally estimated at US$3.73 billion, declined by 1.7% from a year earlier after strong growth in April. Taking April and May together, there was a year-on-year increase of 4.7% thanks to the moderated local epidemic and the support of the Consumption Voucher Scheme, representing a notable improvement from the 7.6% fall in the first quarter. Looking ahead, the retail businesses should continue to revive as long as the local epidemic situation remains under control. 
Closer collaboration between Hong Kong and Shenzhen
The Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone has announced nine Hong Kong-related facilitation measures. These measures, including youth innovation and entrepreneurship, technology development, financial services, legal services and medical services, will provide support to Hong Kong people and enterprises developing in Qianhai and also bring greater convenience to young people seeking to develop their careers in Shenzhen. The HKSAR Government is exploring with the Qianhai Authority the feasibility of lowering the entry thresholds for Hong Kong-based fund managers and funds, streamlining the application procedures and expanding the investment scope under the Qualified Foreign Limited Partnership scheme in order to facilitate the access of Hong Kong-based private equity funds to the Qianhai market. The pilot measure for wholly owned Hong Kong enterprises to adopt Hong Kong law has been implemented in Qianhai of Shenzhen. The Government is striving to extend the current measures to other Mainland cities of the Guangdong-Hong Kong-Macao Greater Bay Area.
Hong Kong Panorama at New York film festival
This year’s New York Asian Film Festival (NYAFF) will feature a total of 14 Hong Kong films under the “Hong Kong Panorama” banner, including seven exhilarating new productions. Marking the 20th anniversary of NYAFF and the 25th anniversary of the establishment of the HKSAR, the festival will also screen five absolute, modern classics directed by five grandmasters of the city’s film industry. The NYAFF will be co-hosting, with the Hong Kong Economic and Trade Office in New York and Film at Lincoln Center, a free outdoor screening of Wong Kar Wai’s classic Happy Together on July 16, as part of the three-month-long Summer for the City festival at Lincoln Center.
Hong Kong Palace Museum opens
Hong Kong’s newest arts and cultural landmark, the Hong Kong Palace Museum located at the West Kowloon Cultural District, officially opened its doors to the public (Jul 3), presenting over 900 priceless treasures from the Palace Museum, including 166 grade-one national treasures. Many of them are on display in Hong Kong for the first time, while others have never been shown to the public before. Blending art and technology, the Hong Kong Palace Museum features a total of 53 multimedia projects with projection mapping installations, interactive and digital exhibits, soundscape experiences and video installations to provide unique experiences for visitors to appreciate traditional Chinese art and culture. Among them is “From Dawn to Dusk: Life in the Forbidden City”, where visitors step back in time to experience court life in the Qing dynasty.
Hong Kong and its Basic Law
The Basic Law is the constitutional document of the HKSAR. Put into effect on July 1, 1997, it enshrines within a legal document the important concept of “One Country, Two Systems”.
Q: Does the HKSAR Government have complete control over fiscal and economic policies and safeguard the free movement of goods, assets and capital?
A: The HKSAR Government formulates its own economic policies; manages its finances independently; prepares its own budgets; issues its own freely convertible currency; practices an independent taxation system; keeps its low and simple tax regime; formulates its own monetary and financial policies; safeguards the free flow of capital; maintains the status of a free port; pursues a policy of free trade and protects the free movement of goods, intangible assets and capital. (BL Articles 62; 106-119)

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