The housing market concerns fiscal, banking, and land policies of the government as well as the interests of businesses, so that the regulation in this sector has encountered massive resistance.

However, regulatory efforts in recent years have paid off, as the government has a very firm resolve, and has been able to curb speculative and investment-driven demand with focused measures.

The people's demand for housing is strong and persistent as China is a big country with 1.3 billion people, going through rapid industrialization and urbanization.

We have set the target of providing adequate living space for the people, but this does not mean that each person will necessarily have his or her own home. We will continue to encourage people to rent houses.

If we develop the housing market blindly, a bubble will emerge in the housing sector. When the bubble bursts, not only the housing market will be affected, it will weigh on the entire Chinese economy.

Housing prices should match people's income and the construction cost, and the profit should be reasonable too. The government will not slacken its efforts to regulate housing prices, which are still far above reasonable levels.

In the housing sector, we should allow the market to play a fundamental role in allocating resources. At the same time, the hand of the government is indispensable, as it can promote stability and social equality.

Hong Kong's development

Fifteen years have passed since Hong Kong returned to the motherland. What has happened in Hong Kong over the past 15 years has shown that the principles of "one country, two systems," "Hong Kong people governing Hong Kong" and a high degree of autonomy have strong vitality.

In the past 15 years, Hong Kong encountered two financial crises. But under the leadership of the government of Hong Kong Special Administrative Region (HKSAR) and with the joint efforts of the Hong Kong compatriots, it has successfully weathered the financial crises and sustained its status as an international financial center and still enjoys a sophisticated free economy.

In 2011, the per-capita GDP of Hong Kong reached a record high of $34,200 and the employment situation there is in positive shape. Hong Kong now faces both difficulties and opportunities. The global financial crisis and the European debt crisis still have had an adverse impact on Hong Kong and pressure remains. Moreover, Hong Kong faces the dual pressure of slowing economic growth and inflation.

Under such circumstances, Hong Kong must continue to work hard to develop the economy, improve people's lives, advance democracy and maintain social harmony. Efforts should be made to address such important matters as social equity, consumer price hikes, people's housing needs, education and people's medical care on a priority basis.

The election for the fourth-term chief executive of HKSAR is currently underway. I believe that as long as the principle of openness, justice and fairness is observed and relevant legal procedures are complied with, Hong Kong people will elect a chief executive who enjoys widespread popularity.

Economic growth

China lowered its GDP growth target for 2012 to 7.5 percent, the first time in many years that the target has dropped below 8 percent. Slower growth is made to fit with the 12th Five-Year Plan for national economic and social development, which targets a 7-percent annual GDP growth rate from 2011 to 2015, and to guide people in all sectors to focus their work on accelerating the transformation of the pattern of economic development and making growth less dependent on natural resources and environmental consumption.

Indeed, the Chinese economy faces slowing growth due to the impact from the European debt crisis and the diminishing of contracting overseas demand. Under such circumstances, to lower the growth target mainly aims to facilitate economic reform. The Chinese economy will overcome the current unbalanced, uncoordinated and unsustainable development mode to achieve expansion of higher quality, which will be helpful for world economic growth.

China's GDP has topped 47 trillion yuan ($7.42 trillion). On this basis, the growth rate of 7.5 percent cannot be counted as low, not to mention the economy would keep expanding at this pace.

We will make every effort to let ordinary people enjoy more benefits.