Press Releases and Statements
Speech by Chief Executive (English only)
The following is a speech by the Chief Executive, Mr Tung Chee Hwa, at the Gala Dinner for AustCham ANZ Australian Business Awards 2003 held at the Grand Hyatt Hotel tonight (October 17)(English only):
Distinguished guests, ladies and gentlemen,
I am delighted to join all of you tonight on this wonderful occasion. I am going to disappoint you because I can't quite speak with an Australian accent. However, I would like to congratulate the organisers for the detailed arrangements that have gone into planning this event and having the foresight to ensure that it should not clash with one of Australia's, or should I say, 'the Wallabies', games during the Rugby World Cup now underway in your country. It is a great sporting event for a great sporting country.
Indeed, every year we have a glimpse of the passion for the game at the Hong Kong Sevens. The skills, the determination and the dedication of the players that are needed to win the game could be equally applied to the qualities and commitment shown by the entrants in this year's Australian Business Awards as they strive for excellence in their chosen field.
Coming from a business background as I am, I think you all know that I have an extremely soft spot for organisations like the Australian Chamber of Commerce in Hong Kong that encourages businesses to excel, to innovate and to be entrepreneurial in their outlook. Not only do these attributes benefit the company, its shareholders and employees, but they stimulate other enterprises to follow suit. This in turn generates more employment opportunities and provides a stimulus to an economy to move up the value chain.
I can say that Hong Kong, with its free and open market economy, is benefitting from the presence of international chambers like yours. Hong Kong has been home to Australians for many, many decades. Some 500 Australian companies, including many household names, are operating in Hong Kong and providing employment for over 200,000 people.
For many years, Australia has been a popular destination for Hong Kong immigrants and Hong Kong students studying overseas. The return of the students, and immigrants especially after the Handover, has not only brought back the Australian culture, knowledge and skills enriching our community, but it has also helped to build a strong tie between Hong Kong and Australia. It's true to say that Australians have become an integral part of our community and you share with us the opportunities and challenges of our future.
Let me now say a few words on a couple of topical subjects that may be of interest to you. One is of our economy. I think for those of you who live here would agree the atmosphere in Hong Kong is now much better. The figures that are in front of us also show that the economy is slowly coming around. GDP figures could be revised upward again. Consumer spending is now edging up even though slowly. Property prices are stabilising and also edging up. Unemployment rate is going to be trending downward. Although economic restructuring is a long process, I think we are now seeing the light at the end of the tunnel. What has made the difference? Well, the restructuring has been going on for some time. Costs have been adjusted year after year. The recent return of confidence was for a number of reasons. First of all, of course, is the arrangement with the Central People's Government to permit individuals to come and visit Hong Kong as tourists. That has had the instant impact on spending here in Hong Kong on the hotel businesses, and has brought instantly a feeling that things are moving well.
My daughter who is now living in San Francisco was back in Hong Kong with her triplets. We went out for dinner in a traditional Chinese restaurant, "Yung Kee". I asked the owner of the restaurant how business was. He said, "Mr Tung, it's been wonderful. Business is really good, much better even than before SARS." So I said how come. He said that half of his waiters now have learned how to speak Mandarin. Really there are lots of visitors here in Hong Kong who are helping our economy. It is also CEPA which gives us all of our businesses here in Hong Kong, including those who are originally from Australia, the opportunity to enter the China market. Also, the agreement we have reached with the Guangdong authorities on how to work more closely as a regional economy of encompassing Hong Kong, Macau and the whole of the Pearl River Delta.
People now begin to see that this is the way we are going to move forward in the future. As the Chinese economy is developing so well and so rapidly, our future indeed is a very bright one. This is not just for Hong Kong, but for all those who may want to join us from overseas including those from Australia. I believe if you look at the numbers, the economy will continue to move up as it should. Let me tell you that restructuring of any economy is a very painful process, and very often, it would take years.
Globalisation meant that job process moves from developed economies to developing economies. And for developed economies, like Hong Kong, we lose jobs, bursting of the asset bubble after the Asia financial turmoil means the rapid decline of property prices, and the property prices have fallen 70 percent. It has been a very painful exercise for those who own properties seeing their savings wiped out, and obviously the desire for consumption, for spending then declined.
As I said, it has been a very painful exercise for us, and it may still go on a bit longer. But, I believe the worst is now over. We have set our direction, and we are moving forward at last. It is not just about what we are doing with Mainland China. Obviously CEPA and agreement with Guangdong, is very important to us. Obviously tourism from Mainland China is very important to us. Just as important is the fact that there is China, country of huge potential, and rapidly expanding, willing to open their market as a priority for those who are in Hong Kong for our businesses, for our investments, for our professionals to be up there in China to participate in that growing economy.
China has taken a few steps to try to get us going again. I also want to tell you that even on a subject like importation of manufactured goods into China, as you know there are 273 items which by January 1 can move into China without tax. I also want to tell you that by 2006, this number will go up to 4,000 items moving into China without tax. Why 2006? It is simply because that both Hong Kong and Mainland China wanted to be sure that our customs can really manage this without this excellent preferential treatment for Hong Kong being taken advantage of by smugglers and by those who commit illegal acts. So the potential even on that front is enormous, let alone the opportunity for those who are professionals who want to go to Shanghai or Beijing to work, to have the opportunity to participate in that particular economy. But, it is also more than that, our cost has adjusted, Hong Kong dollar being pegged to the US dollar has depreciated substantially, interest rates are low, economy of United States, Japan seems to be on the mend. Of course, Australia has been doing well for all these years. So, all these speak and go well for Hong Kong as we move forward.
One of the other things for those bankers who are interested, who are sitting here in this room, one of the things we are working very hard on is how we can participate in the future in Hong Kong as the Chinese economy continues to grow from a financial point of view in addition to what we are doing today. And I am pleased to tell you one of the things the Prime Minister has agreed with me is that in due course as a first step, Hong Kong banks will be permitted to deal with renminbi, although these are personal accounts; credit cards; deposits on personal basis; the advances; making remittances and so on so forth. And I hope these will be materialised very soon. Of course, in the longer term, if it were one day, the Chinese currency, the renminbi becomes freely convertible, or before that, the Prime Minister has also agreed at my request that Hong Kong will be given the preference to be the offshore centre for renminbi business. We are moving forward confidently as we should, as we enter this new age. I want all of you who are in Hong Kong to understand that Hong Kong is a wonderful place for you to base your business, lots of opportunities here, and I met a few of you who have offices in Shanghai and Beijing. You are all welcome to Hong Kong, but don't forget to set up your offices in Hong Kong.
The second point I want to talk a little bit about is for those of you who actually live in Hong Kong and who understand some of the daily discussions that go on in Hong Kong. One of the huge subjects we are talking about is the reclamation in the Central. First of all, let me tell you that since I became the Chief Executive, the degree of reclamation, the number of points that are going to be reclaimed, and the area that is going to be reclaimed for each point had been substantially reduced.
Within the harbour, there are only three areas that are now subject to reclamation. One is in Central, another in Wan Chai, and the third near or around Kai Tak Airport. There are no other areas that are going to be reclaimed in the harbour. We won't allow it, and the reason is we all care about the harbour. I just want to tell you I care very much about the harbour.
Secondly, I also want to tell you that the reclamation in Central is only for one purpose, that is, to build a by-pass, one that is really needed because the roads in Central are getting very crowded and it will be even more so five to seven years from now. We need to be thinking ahead and we are committed to build that by-pass.
Thirdly, I want to tell you that on July 8th this year, the court ruled that another reclamation in Wan Chai, according to the judge's interpretation of the law, should only be carried out if it is of over-riding importance if there is an immediate need, and that there are no other alternatives, and that impairment to the harbour is minimal. I think these are very good, very sound judgement, and we would certainly like to make sure that whatever we do we should comply with this particular ruling.
The road we are building is a road which is actually a tunnel and reclaim the minimum amount necessary for a road to be built and, above that, there would be sort of a park or promenade for the public to enjoy the harbour from the Central area. There will be no commercial buildings on top of it, and it will be, I believe, a beautiful arrangement. Nevertheless, we understand that there are people in Hong Kong who are concerned whether we are doing too much, and we will continue to listen to the views of the people. So, if any of you have any other views on what we should be doing, we, as a government, will be very delighted to hear them though. I want to emphasize that, as a government, we care about the harbour as everyone in Hong Kong does and we want this harbour to continue to be a beautiful piece of natural asset as you people from Sydney have with your harbour there.
I think these are the two topical subjects which, for those who live in Hong Kong, I want to mention briefly, and sorry if I appear to be making propaganda for Hong Kong.
Ladies and gentlemen, we are going through some tough times but we are beginning to see the light at the end of the tunnel. The presence of so many of you here this evening, representatives of some of the most successful Australian companies in Hong Kong, is a recognition of the Hong Kong advantage--the access to the huge Mainland China market; our low and simple taxes; a legal system you know and can trust; our free and open society where everyone enjoys free flow of information, freedoms of speech, the press, and assembly; a level playing field for businesses; enhancement of corporate governance which already is amongst the best in the world; of course, our world-class infrastructure, etc. and the list goes on.
I promise you we will continue to protect and strengthen these basic tenets that underpin Hong Kong's success. We will continue to consolidate and enhance our position as an international financial and logistics centre, a preferred tourist destination, and a trade and business services hub. We will continue to do more to improve our environment, protect public health, and enhance the quality of life for all our citizens. I want to assure you the SARS attack had done much awakening as to how much more we need to do and I want to tell you we are doing as much as we can everyday. As a place where East meets West and one of the most important gateways to China, we will continue to encourage culture diversity and upgrade our physical infrastructure to ensure we remain the major transport and logistics hub. In sum, we will do all we can to provide a business friendly environment and help you to manage and grow your business in this region.
I hope you will enjoy the evening as much as I do, and thank you very much.
Ends/Friday, October 17, 2003
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