FINANCIAL TSUNAMI, ECONOMIC INSECURITY AND SOCIAL PROTECTION: THE CASE OF HONG KONG

Abstract

Rising economic inequality becomes an important concern for both advanced and developing countries. Nonetheless, political and business elites around the world never question the neoliberal agenda, despite economic crises happening every now and then. The year 2007 may mark the turning point of neoliberal globalisation. As the global financial tsunami kicked off from the burst of the subprime mortgage bubble in the United States in 2007, the global economy is facing an economic hardship never heard of since the Great Depression in the 1930s. Hong Kong as a highly open economy is also severely hurt by the financial tsunami. In every economic recession, all Hong Kong people suffer, but lower classes suffer most. This raises a serious question about whether the current social protection system adequately protects people against an increasingly risky global economic environment. By examining the social policy package adopted by the HK government in fighting against the financial tsunami, we show the lack of long-term strategies and commitments of the government in protecting HK people against globalisation risks and economic insecurity. By drawing experiences from other countries, we suggest that active labour market policies (ALMPs) may be the social policy tools the government can use to reform the social protection system.