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Fifth of Hong Kong residents live below poverty line, new index shows

By Katie Hunt, for CNN
September 30, 2013 -- Updated 0801 GMT (1601 HKT)
 Hong Kong says up to a fifth of its population lives below the poverty line
Hong Kong says up to a fifth of its population lives below the poverty line
STORY HIGHLIGHTS
  • A fifth of Hong Kong's population lives below official poverty line
  • First time government has set a benchmark
  • Gap between rich and poor is widening
  • Government set to announce new measures to help poor

Hong Kong (CNN) -- Hong Kong, with its glittering skyscrapers and luxury malls, is home to some of the world's richest people but new government figures show that a fifth of its population lives in poverty.

About 1.3 million people, or 19.6%, of the population were deemed to be living below the poverty line in 2012, according to the Hong Kong Povery Situation Report 2012 released on the weekend.

It is the first time the city's government has set a poverty threshold, which stands at 50% of median household income before tax or welfare benefits.

"That poverty line marks an important milestone in our effort to alleviate poverty in Hong Kong," Matthew Cheung, Hong Kong's secretary for Labour and Welfare told CNN on Monday.

"We want to build a more caring, compassionate and inclusive society here."

READ: Hong Kong's poorest living in 'coffin homes'

Cheung said that Hong Kong's leader, Leung Chun-ying, would announce a package of measures early next year to help those struggling to make ends meet.

"We want to really tackle the problem of intergenerational poverty, social upward mobility is very important, promote employment and promote self-reliance," said Cheung.

Leung, who took office in the former British colony last year, has pledged to narrow the city's gap between rich and poor, which is at a record high. Although part of China, Hong Kong has its own government and legal system.

The city's Gini coefficient, which measures income equality, stood at 0.537 in 2011, the latest year that government figures are available, up from 0.533 in 2006. A reading above 0.4 suggests potential for social unrest.

If welfare benefits such as social security assistance and old age allowance were included, Hong Kong's poverty rate would fall to 15.2% or 1.018 million people, the government's Commission on Poverty said.

Carrie Lam, Hong Kong's chief secretary for administration and chairman of the commission, said that the poverty line had limitations because household assets are not taken into account and this may overstate the number of people living in poverty.

The 2012 poverty line for one-person households was set at a monthly income of 3,600 Hong Kong dollars ($464); 7,700 Hong Kong dollars ($993) for a two-person household, 11,500 Hong Kong dollars ($1,483) for a three-person household and 14,300 Hong Kong dollars ($1,844) for a four-person household.

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