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Following is the full text of the speech (English only) by the Financial Secretary, Mr Donald Tsang, at the luncheon by the Dublin Chamber of Commerce in Dublin on November 5 (UK time):

Ladies and gentlemen,

Thank you for your very warm welcome.

This is my first visit to Ireland, for which I feel rather guilty. Ireland has fascinated me since my secondary school in Hong Kong, where Irish Jesuit fathers were among my teachers.

Now that I have managed to make my first trip to Dublin, I feel I must use this opportunity to express my warm appreciation of what Ireland has done for the community of Hong Kong.

Irishmen have made our Jesuit and La Salle schools among the very best in Hong Kong. Irish Columban Sisters made a major contribution to the treatment of tuberculosis and children with orthopaedic problems.

Irish people have also been prominent in Hong Kong's professional life. Our legal institutions and the rule of law - on which our way of life depends so heavily - owe much to the distinctive qualities of Irish lawyers [such as former Chief Justice, Sir Michael Hogan, 1955-1970]. Even five successive governors in the early days were Irish.

I have been struck by how much Hong Kong and Ireland have in common. How we have faced similar challenges, and how we can claim a similar record of success.

It's easier to start with the success. We have achieved roughly the same level of prosperity, and our average GDP per head is quite close.

Both Ireland and Hong Kong started their search for prosperity from a similarly low level three decades or so ago.

You traditionally relied on farming as your principal industry, while we depended on textiles and cheap consumer goods. We have both moved sharply up-market and in much the same direction. We now rely increasingly on service industries to generate our growth.

You have created an attractive and dynamic International Financial Services Centre, while Hong Kong claims to be Asia's premier business location and third only to the United States and the UK in the number of foreign banks represented.

Our challenges are also similar. We are both small economies perched on the edge of our continents. Our natural resources are confined almost entirely to the talent and resourcefulness of our people. In other words, we live by our wits.

For this reason, we both understand very well that there are no short cuts to wealth. Luck is all very well but, even in that sport of horse racing that we both enjoy so much, winners usually achieve success through training, expertise, hard work and commitment.

In Hong Kong's case, of course, the past few years have seen a widely publicised return to China's sovereignty and a dramatic region-wide economic crisis.

As you know, Hong Kong returned to China's sovereignty on July 1, 1997. The apocalyptic school of news reporting at the time may have left the impression that it was the end of Hong Kong.

Much of this negative news grew from a preconceived idea that Hong Kong was destined to fold once the British departed. I think I am safe in saying that this is a view one would rarely encounter here in Ireland.

But life has gone on very much as usual, which is quite remarkable when you remember the severe effect of the Asian financial turmoil of the past two years.

Even during the sharp economic downturn, Hong Kong remained one of the most secure and stable cities in the world.

In 1997, our crime rate fell to its lowest in 24 years and stabilised in 1998 at 1 076.1 cases per 100 000 of the population. This was the second-lowest rate for 25 years and below that in most of the world's major metropolitan areas.

It has remained just as stable during 1999, too.

Hong Kong is now an important financial centre with the largest stock market in Asia after Japan. Market capitalisation was US$445 billion at the end of September this year, making it the 10th largest in the world.

We are the world's eighth largest banking centre in terms of external banking transactions volume - which was US$844.6 billion at the end of July this year.

About 450 foreign-owned licensed banks, restricted licence banks and deposit-taking companies from 40 countries have set up shops in Hong Kong.

The Bank for International Settlements ranked our foreign exchange and derivatives market as the world's eighth largest in mid-1998.

Hong Kong is a major fund-raising centre for Mainland China - which is still growing at more that 7 per cent per year - and our securities market is supported by Asia's highest concentration of international legal and accounting firms.

We have embarked on a three-pronged programme to improve our securities and futures market. We are upgrading technology, and instituting regulatory and structural reforms, including the demutualisation, merger and listing of exchanges and clearing houses.

With all that, out economy is probably the most open and externally oriented in the world, with a trade to GDP ratio of 250 per cent.

The Heritage Foundation consistently rates Hong Kong as the world's freest economy. In July this year the World Economic Forum ranked us as the third-most competitive economy after Singapore and the United States.

We are Asia's second largest fund management centre after Japan, the world's 12th largest services economy and last year we were the ninth largest trading entity.

Indeed, our total trade in 1998 was worth US$362.8 billion, which was 3.3 per cent of world merchandise trade.

This is all so far, so good - but not quite good enough. Economic success has to be built on open and competitive markets. You have found the opportunities for accelerated growth through your membership of the European Union, and I am impressed by how high Ireland stands in the European growth league.

I also admire the way that Ireland has attracted so many leading computing and IT multinationals to set up plants here.

A recent Fortune magazine report intrigued me with its view that Ireland can now benefit from its history by leaping into a clean, green, high-technology future without having to clean up the residue of a heavily industrialised past.

Many other parts of the world, especially across Europe, face that potentially ruinous cost, while Ireland makes a clean jump from the potato to the chip.

I was shown a very interesting example of what is happening in our visit to Digital Park yesterday.

Hong Kong has adopted a similar strategy over the past year.

Significant new infrastructure developments will further enhance our role as the pre-eminent gateway to the mainland of China and the communications and transport hub in the region.

We are investing in a project we call Cyberport, on the western shore of Hong Kong Island.

We expect it will make Hong Kong a major IT player over the next century.

This $1.7 billion US dollar Cyberport will provide the essential infrastructure for the formation of a strategic cluster of information services companies, as well as a working and living environment of the highest standard.

Other facilities will include media laboratories, high-speed computers for computer graphics design, multi-media equipment and studio facilities for common use by the more than 100 small to medium sized companies which we expect to become tenants of the Cyberport.

Firms such as Oracle, Microsoft, IBM, Hewlett-Packard, Yahoo! and Cisco Systems have already signed deals to set up in Cyberport - and there is room for more.

In Hong Kong, as in Ireland, we recognise that investment in technology and infrastructure is not enough. More important still is our human capital.

You have provided an instructive example through the high quality of your third-level education. The high proportion of Irish students who continue their education is equally impressive.

So is the return of so many of your young people, the former brain drain. We, too, are doing our best to provide our bright young people with a home that is really worth living in.

We have opened a magnificent, world-class airport to handle traffic destined for the most popular tourist destination in Asia and we have just concluded an agreement with the Walt Disney company to build a major Theme Park in Hong Kong, boosting our tourist industry even further.

Our plans to reinvigorate tourism will be developed in harmony with the environment, since we have all learned a clean environment is essential for sustainable economic growth.

The measures we are putting in place over the next few years, some in co-operation with our nearest neighbours across the boundary, will dramatically clear the air over Hong Kong, as well as enable the right conditions for sustainable development.

We are getting rid of the vehicles that belch out black diesel fumes into the atmosphere. We're cleaning up the quality of our water supplies. We're expanding our pollution-free railway network by some 40 per cent to make it the backbone of our transport system.

We're expanding pedestrian zones and encouraging the use of less polluting modes of transport. In fact, we'll be spending about 2.9 billion Punt over the next few years on enhanced environmental measures.

We in Hong Kong are well placed to take advantage of the Internet-enabled supply chain. We have an excellent and advanced telecommunications infrastructure.

Domestically, we have had fully digitised networks since 1995. Over 388,000 km of optical fibre has been laid. All commercial buildings and 75% of all households are already covered by our broadband network.

Externally, Hong Kong is well connected with the rest of the world by eight submarine cable systems. With a total capacity of 19.1 Gbps (Gigabytes per second), we are currently ranked second in the region, only after Japan.

We already have another planned submarine cable system in the pipeline that will more than double our total external capacity to 39.1 Gbps by the end of this year.

But there is no room for complacency in Hong Kong. We will continue with the progressive liberalisation of our telecommunications market to ensure that our businesses will have the best infrastructure and services at competitive prices.

This approach has generated a very enthusiastic response to recent invitations for applications for local fixed telecommunications services and television broadcasting.

This is helpful in attracting new investment and services in HK, underlining our position as a telecommunications, broadcasting and Internet hub in the region.

We have also established a satellite transmission 'teleport' and an Applied Science and Technology Research Institute.

Planning is well advanced for our Science Park project on a site bordering a beautiful harbour. This 22-hectare site will be developed over the next decade and a half and aims to attract technology-based firms and activities to Hong Kong. I have no doubt we will succeed in doing so.

And all this is taking place in one of the world's most densely populated urban areas. Hong Kong's built-up areas house 27,000 people per square kilometre on average. In some areas it is over 50,000 people.

Overall, Hong Kong has about 6,000 people per square kilometre. By contrast, Ireland has about 50.

We do our best for all those people. Hong Kong provides free and universal basic education for nine years. About 1.3 million students, or 19.7 per cent of the total population, were in full-time education during the year.

Our investment in education continues to grow, with greater emphasis on basic education and the learning of English. All children between the ages of six and 15 are entitled to free school places and 85 per cent of the students in the appropriate age group also receive secondary level or technical education at highly subsidised rates.

At tertiary level, 18 per cent of the relevant age group can obtain a university education. Tertiary education accounts for about one-third of the education budget.

In the 1999-2000 financial year we have budgeted more than 2 billion Punt for education.

As I said earlier, I have left it too long to visit Ireland. But I am glad to say I will take some very positive impressions and a number of useful lessons with me.

In Hong Kong, we pride ourselves on the standards of our tourist industry. But we have much to learn from you and from the warmth and graciousness of your hospitality.

We also have much to learn from the way you have managed to create a booming modern city while preserving a great deal of your magnificent Georgian Dublin. I only wish that we in Hong Kong had managed to preserve more of our architectural heritage.

Altogether, you have created a unique work environment. Dublin offers not only a well-educated work force combined with highly motivated professionals. You also enjoy the colour and variety expected in a continental European city.

Most of all, Ireland offers us reassurance. Like Hong Kong, you belong to that select league of small economies that have succeeded - often against the odds.

Economies whose incomes and living standards have caught up with the most advanced in the world thanks to the outstanding quality of their people and their faith in themselves.

Thank you, or if you will forgive my Gaelic, gurra ma hagut.

End/Saturday, November 6, 1999

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