HONG KONG - Many in Hong Kong cheered on Wednesday after newspapers reported that unpopular Chief Executive Tung Chee-hwa had resigned, saying it would be good for the city to have a new leader.

"This is the best news since the handover," one young business executive exclaimed.

Tung, a former shipping tycoon with little political experience, was handpicked by Beijing to be Hong Kong's first chief executive after the former British colony was handed back to China in 1997.

But his tenure has been a rocky one, marked by policy gaffes, resignations of key lieutenants and three economic recessions which shattered the confidence of the freewheeling capitalist city of nearly seven million people.

"I will be happy if he goes. He's not good. He has been slow in implementing policies," said secretary Rosanna Chung.

Hundreds of thousands of protesters, frustrated with his rule and often aloof style, poured onto the streets to demand his resignation in the recent years, hanging him in effigy, and he was often ridiculed in local newspapers and comics.

Tung, 67, told Chinese officials he was stepping down because his health was deteriorating, newspapers said.

But some analysts believe Beijing ordered Tung to step down and is giving him a senior post in its top consulting body to pave the way for a graceful exit.

"His departure will be good. Tung is not doing a great job," said Ray Lau, a 30-year-old architect.

Regular polls by the University of Hong Kong consistently found two-thirds of the people in the territory did not believe Tung should be the city's leader.

But some others supported him.

"I hope he'll stay. Hong Kong's problems are not his fault. His resignation will not lead to an economic revival," said receptionist F.S. Chau.