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The Chief Executive, Mr Tung Chee Hwa, met with the visiting Prime Minister of Ireland, Mr Bertie Ahern, today (Friday) and exchanged views with him on the latest economic developments in Hong Kong and Ireland.

The Chief Executive assured Mr Ahern that the HKSAR Government was fully committed to the free market.

"We have a flexible market which allows very efficient price adjustment for major production factors," Mr Tung said. "We are aware that it is necessary to allow market forces to bring our prices to a level at which the market can afford. We are ready to take the pain arising from the adjustment process.

"We have already made immediate and huge adjustment in the property market," he said. "The adjustment process has been extremely efficient."

"The labour market has also been undergoing adjustment, but this will take some time," he added.

"It is important to have unity in the community for all sectors to join hands to overcome the difficulties we are facing," he said. "Employers must be caring to their employees in this adjustment process in order to bring the best out of their employees. This is always true from my former life as an employer in the private sector."

The Prime Minister congratulated the Chief Executive on the successful implementation of the One Country Two Systems principle as the HKSAR stepping into its second year after returning to China. He believed that with efficient market systems the Hong Kong economy would rebound quickly.

The Chief Executive said that with huge reserves and in the absence of foreign debts, Hong Kong would continue to invest heavily in education and infrastructure, and capitalise on its links with the Mainland of China.

"These are to ensure that coming out of this economic downturn, we shall have completed all the necessary adjustments and be ready to be the city in Asia," Mr Tung said.

The Chief Executive told the Prime Minister that Hong Kong welcomed Irish investors to participate in our many projects in improving the infrastructure and the quality of life.

"We are the most international city in Asia and are determined to remain that way," he added. "We welcome investors to participate in our developments from all over the world."

The Prime Minister briefed the Chief Executive on his trip to China. He said he was most impressed by the efforts made by the Chinese people in overcoming the floods and the re-housing programme introduced by the Chinese Government for the flood victims.

"The determination of the Central People's Government in tackling the floods, and the remedial action programme they have put together, deserve our full admiration. These are really daunting tasks," Mr Tung said. "Indeed the soldiers, the workers and the residents had demonstrated great courage and unity in protecting people's lives and property against the floods."

"People in Hong Kong showed deep concern for the floods and great sympathy for those who suffered," Mr Tung said.

"The experience in dealing with the floods tells us that with unity among the people, we can achieve more than what we imagine we could possibly achieve," he said. "Here in Hong Kong despite the economic difficulties we are going through, I am optimistic that with unity in the community we will come out of the economic downturn stronger and fitter and be ready for new challenges."

The Prime Minister shared with the Chief Executive the Irish experience in developing high technology and pharmaceutical industries. The Chief Executive congratulated the Prime Minister on the economic success made by Ireland in recent years and wished him a good stay in Hong Kong.

Mr Ahern arrived in Hong Kong yesterday following a visit to the Mainland and will be leaving tonight.

End/Friday, September 18, 1998

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