* Lam’s annual policy speech disrupted
* Lam offers housing crisis policy, defends government
* Lam says has held ‘close door’ talks over unrest
* Pro-democracy lawmakers call for Lam’s resignation (Adds Singapore PM, paragraph 10)
HONG KONG, Oct 16 (Reuters) - Hong Kong leader Carrie Lam had to abandon her policy speech because of jeering lawmakers on Wednesday but later offered no direct olive branch to pro-democracy protesters, hoping instead to ease resentment by building more public housing.
Lam, who had to broadcast the annual address via a video link after the rowdy scenes in the Legislative Council, had hoped to try to restore confidence in her administration after four months of often violent anti-government and anti-China protests.
She gave up initial attempts to deliver the address after pro-democracy lawmakers called out for “five demands, not one less” and projected the protest rallying cry on to a backdrop behind her.
The demands include universal suffrage for the Chinese-ruled city and an independent inquiry into what they say has been excessive force by police in dealing with the unrest.
Protesters have trashed government buildings, including the Legislative Council, daubed businesses seen as pro-China with graffiti, set street fires and thrown petrol bombs at police who have responded with water canon, tear gas, rubber bullets and several live rounds.
Police have arrested more than 2,300 people since June. Thousands have been wounded, including two shot by live rounds.
In her policy statement, Lam was unapologetic about her government’s response to the protests, which has included introducing British colonial-era emergency laws this month.
“Any acts that advocate Hong Kong’s independence and threaten the country’s sovereignty, security and development interests will not be tolerated,” she said.
“Despite the stormy times and overwhelming difficulties Hong Kong is experiencing, I believe that so long as we accurately adhere to the principle of ‘one country, two systems’, we will be able to get out of the impasse.”
Singapore Prime Minister Lee Hsien Loong said the protesters were trying to humiliate and bring down the Hong Kong government. “There is no simple solution,” he said.
The protesters are angry at what they see as Beijing’s tightening grip on Hong Kong, which was guaranteed 50 years of freedoms under the “one country, two systems” when Britain returned the city to China in 1997.
Beijing rejects the charge and accuses Western countries, especially the United States and Britain, of stirring up trouble. The unrest poses the biggest popular challenge to Chinese President Xi Jinping since he came to power in 2012. He has warned that any attempt to divide China would be crushed.
A Norwegian lawmaker, Guri Melby, tweeted that she had nominated the Hong Kong people for the 2020 Nobel Peace Prize for their stand for freedom of speech and democracy.
Lam later told a news conference that she had held “closed door” meetings with some members of the protest movement and when the unrest ended she would hold more.
Pro-democracy lawmaker Tanya Chan said Lam should resign.
“Both her hands are soaked with blood. We hope Carrie Lam withdraws and quits,” an emotional Chan told reporters.
In her news conference, Lam rejected two of the protesters’ five demands - amnesty for those charged and universal suffrage - saying the first was illegal and the second beyond the chief executive’s power.
Hong Kong’s Civil Human Rights Front in a statement also called for Lam to step down.
“We urge Carrie Lam to stop destroying Hong Kong, respond to the five major demands, and step down,” it said. Lam has for months rejected calls to step down.
The leader of the group, Jimmy Sham, was attacked hours later by a group of men in the gritty Mong Kok district on the Kowloon peninsula. Photographs on social media showed a bloodied Sham laying in the street. It is the second time he has been attacked since the protests began.
“It is not hard to link this incident to a spreading political terror in order to threaten and inhibit the legitimate exercise of natural and legal rights,” said the group.
Hong Kong’s unrest was ignited by an extradition bill, which could have seen residents sent to Communist Party-controlled mainland courts for trial. Lam has said the bill has been withdrawn, but the suspension of the legislature meant it could not be formally dropped.
Densely populated Hong Kong boasts some of the world’s most expensive real estate and the inability of many young people to get a place of their own has fuelled the protests.
Lam’s housing policy is one of the boldest in recent years, vowing to take back large tracts of land held by a handful of powerful developers and create public housing.
“We are determined to create home ownership opportunities for people of different income groups such that they will happily make Hong Kong their home,” Lam said.
Lam said about 700 hectares of land in the New Territories would be brought back into public use under what is known as a land resumption ordinance. More than half of the land would be taken back in the next few years.
No Hong Kong leader has take back land from private developers since the handover.
Pro-establishment lawmaker Abraham Shek, who represents the real estate sector, rejected the policy, and the pro-Beijing Democratic Alliance party said the policy speech lacked concrete measures.
“It’s a conservative, procrastinating blueprint with few new ideas,” said the party’s chairwoman, Starry Lee.
Major developers, including Henderson Land, New World Development and Sun Hung Kai Properties , are sitting on “no less than 1,000 hectares” of agricultural land, according to government estimates. (Reporting By Donny Kwok, Clare Jim, Sarah Wu, Twinnie Siu, James Pomfret and Jessie Pang; Writing by Anne Marie Roantree, Farah Master and Michael Perry; Editing by William Maclean and Nick Macfie)