Hong Kong's Donald Tsang Vows to Remedy Public Anger at Home Prices

Tsang took office in 2005 after mass protests led his predecessor to quit, and with the economy smaller than when the city was returned to Chinese rule eight years earlier. Gross domestic product growth of 26 percent since then, unemployment at a 13-year low and a minimum-wage law failed to stop his popularity plunging as a widening wealth gap fuels public anger.

While proximity to China boosted exports, retail spending and services, an influx of mainland money also pushed home prices beyond the reach of many people. With policy options limited by the currency's peg to the dollar, Tsang on Oct. 9 signaled he will repeat a pattern that's seen more than HK$180 billion ($23 billion) in power subsidies, tax rebates and other sweeteners awarded by the government in the past four years.

"Tsang's quick fixes of handing out candies are like opening a Pandora's box," said Joseph Cheng, a professor of politics at the City University of Hong Kong. "Hong Kong can be pretty proud of its economic performance, but Tsang has made no efforts to push long-term policies addressing livelihood issues."

The policy address begins at 11 a.m. local time.