Hong Kong - Hong Kong leader Donald Tsang on Wednesday bowed to public pressure to introduce a minimum wage for workers in the wealthy city of 6.9 million.

The rich-poor divide has widened sharply in recent years, and hundreds of people took part in a march this month demanding a minimum wage of 33 Hong Kong dollars (4.25 US dollars) per hour.

In his annual policy address Wednesday, Chief Executive Tsang admitted that a voluntary minimum wage for cleaners and security guards introduced two years ago had been a failure.

A Minimum Wage Commission would now be set up to study salary levels and decide what the minimum pay rate should be in the former British colony, Tsang said.

Proposals for a minimum wage have been fiercely opposed by business groups in Hong Kong, which said it would diminish the city's competitiveness and drive businesses to the wall.

Tsang's decision to announce a minimum wage was a major victory for labour groups that have been campaigning for it for years.

"I am aware that some people - including businessmen, employers and academics - have qualms about the introduction of a statutory minimum wage," Tsang told legislators in his policy address. "Let me stress that the government will handle the relevant issues, including the minimum wage level and related review mechanism, in a prudent and pragmatic manner."

"The introduction of an across-the-board minimum wage should protect workers against exploitation while at the same time prevent the loss of low-paid jobs," he argued.

Currently, the only minimum wage in Hong Kong is for foreign domestic helpers, mostly from the Philippines, Thailand and Indonesia, who must by law be paid a minimum of about 460 US dollars a month. (dpa)