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The Chief Executive, Mr Tung Chee Hwa, exchanged views with the Managing Director of the International Monetary Fund, Mr Michel Camdessus, on international financial issues at a meeting held at Government House today (Monday).

Mr Camdessus is in Hong Kong to attend the 32nd International General Meeting Session of the Pacific Basin Economic Council.

During the meeting, Mr Tung noted that there was widespread consensus that governments and central banks across the globe needed to develop a new world financial order.

"It is important that we do not lose momentum in this effort despite signs of stability in the world financial market," he said. "It is my firm belief that the urgency to better coordinate cross border monetary policy, accountability, and supervision of short-term capital flow still exists."

"As the region that bore the brunt of the crisis, it is our common challenge to push for the true realisation of a new global financial architecture as pronounced by G7 in 1998," he stressed.

On the local front, Mr Tung updated Mr Camdessus on economic developments in Hong Kong in the wake of the Asian financial turmoil and briefed him on the very determined and effective measures the Government had taken to alleviate the pain, spur economic growth and pave the way for long-term recovery.

The Chief Executive told Mr Camdessus that while the accelerated adjustment process was painful for Hong Kong, it was absolutely necessary for us to regain our competitive edge. They shared the view that Hong Kong would emerge stronger after the adjustments.

While Hong Kong was building on our existing and traditional strengths as a financial centre, Mr Tung added that we were also seeking to develop the SAR into a knowledge-based society, an innovation and technology centre and the premier international city in Asia.

The Chief Executive also touched on the right of abode issue, saying that to deal with the issue, we were now considering two options : to seek amendment or interpretation of the Basic Law.

Mr Tung assured Mr Camdessus that the ultimate decision would be both legal and constitutional. "We are determined that judicial independence and the rule of law must be upheld," he said.

Photo:The Chief Executive, Mr Tung Chee Hwa, has a meeting with the Managing Director of the International Monetary Fund, Mr Michel Camdessus, at Government House.

End/Monday, May 17, 1999

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