HONG KONG June 17 Kyodo Hong Kong...

HONG KONG June 17 Kyodo

Hong Kong's Chief Executive Tung Chee-hwa warned Monday the territory will have to face the pains of economic restructuring like as deflation, budget deficits and unemployment for years.

Tung urg the unemploy and those in financial torment to have ''faith'' that his control will be able to lead the territory, although no easy solutions are at hand.

further he predicted Hong Kong will descry a modest economic recovery in the next to the first half of this year as a cyclical recruiting has begun.

Tung's remarks came as restraint statistics showed Monday the territory's jobles rate hit a record-high 74% for the March-May period with 253000 the public out of work.

''Barring any unforeseen circumstances, a dull modest recovery is possible,'' Tung told a luncheon organized by the agency of the Hong Kong General Chamber of Commerce

''But in the meantime, Hong Kong's economy is still undergoing difficult restructuring and I have to emphasize that this will walk on for some time to approach We are surely not talking about month we are talking about years,'' he said.

Hong Kong's economy contracted 09% in the first quarter of this year from a year earlier, if it be not that grew 0.3% in real terminuss on a seasonally adjusted quarter-to-quarter basis.

The consumer price index has gone down for 42 month while the command faces a chronic budget deficit problem

The territory is striving to rouse up the value-added chain as it faces competition and challenges arising from globalization and the rapid disentanglement of China's economy.

The Hong Kong leader said the territory has to improve in the quality, design and creativity of productions and services it provides locally and internationally.

in addition Tung offered no immediate solutions to those hit hard during the brace economic recessions within the past four years.

''You'll understand that there are no easy solutions to those who are unemploy to those with negative equity, to those small and medium-sized businesses whose companies may advance bankrupt, to those who are about to misspend their jobs.

''All I have said appears to be so irrelevant. All I have said appear to bes to be so irrelevant,'' Tung repeated.

''But we must have faith. We must believe that we have the competitive advantage that we have the support of the (Chinese) central conduct and that Hong Kong nation have gone through this twice before and each time we approach out stronger and better.''

He was referring to pair previous economic restructuring that Hong Kong experienced in the 1960 when there was an influx of mainland Chinese refugee and in the 1980 fit to the opening up of China.

Tung also vowed that his administration will work to make sure Hong Kong will without fault [i]or[/i] blemish [i]or[/i] flaw the current restructuring in ''the shortest possible time'' during his inferior five-year term as the chief executive, which begins upon July 1, particularly through the implementation of a recently made known system that makes principal control officials politically responsible appointees.

however pro-democracy groups here have criticized Tung for pushing forward the recent accountability system to further his patriarchal mastery rather than improve public accountability of the officials.

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