The Economy | 67
The Hong Kong economy has also benefited from several policy measures initiated by the Central Government in 2004. In early 2004, the Central Government agreed to enable Hong Kong's local banks to operate personal renminbi business, including deposit, exchange, remittances and renminbi bank cards. This enhanced the role of Hong Kong as a key financial centre for the Mainland. In August, measures were introduced to facilitate Mainland enterprises investing in Hong Kong and Macao. The Central Government's other relaxation measures, though not exclusive to Hong Kong, will also benefit the Hong Kong economy by facilitating the inflow of Mainland capital. For instance, Mainland insurance companies are now allowed to invest in overseas capital markets, and it is reckoned that Hong Kong will be the key beneficiary. Hong Kong also stands to benefit from relaxation of restrictions on outward remittance associated with emigration of Mainland residents and Mainland students studying overseas, and from the raising of the limit on renminbi cash Mainlanders are allowed to carry on overseas trips.
The vision of the HKSAR Government is to develop Hong Kong as Asia's world city by consolidating Hong Kong's unique position in the region as well as its role as a gateway to the Mainland. Reflecting the prominent role of Hong Kong as a business hub in the region, the number of overseas and Mainland companies to set up operations in Hong Kong has continued to rise in recent years, more so after the launch of CEPA. Specifically, the number of regional headquarters and regional offices in Hong Kong in 2004 hit new highs. Within this total, the number of regional headquarters set up by Mainland companies in Hong Kong had a more distinct increase, as many of these Mainland companies set up business operations or joined forces with local enterprises to tap the vast market potential of CEPA. The envisaged benefits of setting up operations in Hong Kong under CEPA are also one of the factors considered by many overseas companies in investing in Hong Kong.
Public Finance
Structure of Government Accounts
The Government controls its finances through a series of fund accounts. The General Revenue Account is the main account for day-to-day departmental expenditure and revenue collection. There are eight other funds established by resolutions of the Legislative Council for specific purposes such as to finance capital works expenditure or government loans and investments. They are the Capital Works Reserve Fund, Capital Investment Fund, Civil Service Pension Reserve Fund, Disaster Relief Fund, Innovation and Technology Fund, Land Fund, Loan Fund and Lotteries Fund.
The Capital Works Reserve Fund finances the public works programme, land acquisitions, capital subventions, major systems and equipment items, computerisation and the payment of redemption money in respect of land exchange entitlements. Its income is derived mainly from land premia and appropriation from the General Revenue Account.
The Capital Investment Fund finances the Government's capital investments, such as equity injections in the Airport Authority, the Kowloon-Canton Railway