Press Release



Speech by Director of Information Technology Services


Following is the full text of the speech delivered by the Director of Information Technology Services, Mr Lau Kam-hung, at the seminar on e-commerce in the new millennium jointly organised by the Information Technology Services Department and the Asian Oceania Electronic Messaging Association today (May 31)(English only):

Good morning, ladies and gentlemen,

Welcome to this Seminar on E-Commerce in the New Millennium which is jointly organised by the Asia Oceania Electronic Messaging Association and the Information Technology Services Department. Today's seminar is one of a series of events organised by my department in promoting the adoption of e-commerce in Hong Kong. This seminar aims to enhance the awareness and knowledge on e-commerce of the local small and medium sized enterprises, or SMEs, and will also shed some light on e-commerce from both the global and Asia-Pacific perspectives.

It is my pleasure to talk to you about the information technology strategy of the Hong Kong Special Administrative Region and the progress we have made in building Hong Kong as a major business centre in the digital world of the Information Age.

The rapid development of e-commerce has been one of the most remarkable developments affecting our businesses. It is bringing about new opportunities, opening up new markets and helping to reduce costs. A recent industry study released by Gartner Group in February 2000 suggests that the value of business-to-business e-commerce could reach US$7.8 trillion by 2004. The message is clear that the potential of e-commerce is huge. There will certainly be ample opportunities for enterprises, both big and small, to reap the benefits of conducting business electronically over the Internet.

The Hong Kong SAR Government is fully committed to encouraging the development of e-commerce to maintain Hong Kong's competitive edge and to drive our overall economic growth. In November 1998 we published the Digital 21 IT Strategy for Hong Kong. It set out the vision and targets to enhance and promote Hong Kong's information infrastructure and services so as to make Hong Kong a leading digital city in the globally connected world of the 21st century.

We believe that Digital 21 will build on Hong Kong's established strengths to foster an environment conducive to the development of e-commerce in Hong Kong.

Instead of going through all the initiatives in the Digital 21 one by one, I am going to focus on several key areas, which will facilitate the development of e-commerce in Hong Kong.

Firstly, to ensure that electronic transactions can be performed effectively and efficiently over the Internet, we need a high quality and high capacity telecommunications infrastructure to provide bandwidth and services at affordable prices. Our broadband networks cover practically all commercial buildings and are available to over 80 per cent of households. Externally, the total capacity of our submarine cables stands second only to that of Japan in Asia.

To maintain Hong Kong's pre-eminent position and to further enhance our telecommunications systems for the development of e-commerce, we encourage more competition and innovation under an open, fair and predictable regulatory framework.

To encourage further local broadband coverage, we have issued five licences for local fixed telecommunications network services using wireless networks. These five companies are able to offer broadband services and they have pledged to roll out their new services within four to 16 months from licensing.

We have also issued a fixed telecommunications network services licence to Hong Kong Cable TV to provide telecommunications services over its network. Its network will be rolled out to over 1.7 million premises by the end of 2002.

To increase our external telecommunications capacity, we have issued 13 licences for external satellite-based fixed telecommunications network services.

Furthermore, the Hong Kong SAR Government is actively preparing for the introduction of third generation mobile phone services or 3G. An industry consultation paper was issued in March on the technical and licensing aspects of 3G mobile phone services. Licence applications will be invited around the end of this year and we expect 3G service to be available to the public in 2001.

These are our major steps in liberalising our telecommunications market and in introducing competition. We believe that the increased competition will lead to lower costs, better services, innovation and more choice for our businesses and consumers.

Secondly, to enhance security in the conduct of electronic transactions and to enable electronic commerce to take hold and flourish in Hong Kong, we needed to establish a clear and supportive legal framework. The Electronic Transactions Ordinance, enacted in January 2000, gives legal recognition to electronic records and digital signatures and provides for a voluntary certification authority recognition scheme. Under the scheme, certification authorities, or CAs, may apply to the Government for recognition on a voluntary basis.

CAs serve as trusted third parties to ensure trust and security in electronic transactions. They issue digital certificates to their subscribers. Through the use of public and private key pairs and digital certificates, individuals and businesses can:

- establish the identity of the other party in electronic transactions;

- ensure the integrity and confidentiality of electronic messages transmitted over open communication networks; and

- safeguard the non-repudiation of electronic transactions.

Hongkong Post, as part of the Hong Kong SAR Government, is the first public Certification Authority whose operation conforms to international security standards thereby addressing the issues of interoperability and compatibility, and meets both the security and operation requirements to support various e-commerce applications.

In addition to the Hongkong Post, the Government encourages private sector initiatives in the provision of CA services and both local and overseas CAs may apply for recognition as recognized CAs under the Ordinance and for recognition of their digital certificates.

Thirdly, for e-commerce to flourish in Hong Kong and to reach out to all potential customers, we must have a Chinese language interface that is open and common for users in the community who prefer to communicate electronically in Chinese.

The current critical issues of using the Chinese language in electronic communication revolve around the existence of multiple standards and the fact that none of these standards cover all of the Chinese characters commonly used in Hong Kong. Users may need to define their own Chinese characters in the user-defined area by themselves. This can be a serious problem in networked communication.

The Hong Kong SAR Government is taking an active role in the ongoing discussions with the International Organization for Standardization, or ISO in short, on the development of the ISO 10646 standard. The standard is intended to encompass all written scripts, including the Chinese characters commonly used in Hong Kong. The new ISO 10646 standard, which is scheduled for release this year, will ease the existing limitations of Chinese language computing.

Fourthly, leading by example and by creating an environment that embraces change, the Hong Kong SAR Government has introduced the Electronic Service Delivery or ESD Scheme aimed not only at improving public services but also at helping to familiarise our citizens with and giving them the confidence to use e-commerce.

Under this scheme, public services will be provided over the Internet and through other electronic means via an open and common information infrastructure 24 hours a day, seven days a week. The open and common information infrastructure that we are developing for ESD will serve as a platform for the private sector to make use of in conducting e-commerce at a later stage.

The first phase of the scheme will be launched in October 2000. A wide range of services provided by government departments and public agencies will be available including the submission of tax returns, voter registration, application for renewal of driving and vehicle licences, payment of government bills, booking appointment for ID card registration, information look-up for tourists, etc. In the long run, we aim to include all public services amenable to the electronic mode of delivery under the ESD Scheme.

In addition to the ESD scheme, the Hong Kong SAR Government is also working on other projects aimed at familiarising our citizens with the electronic world and promoting the wider adoption of e-commerce in the community.

The Interactive Government Services Directory, launched in March 1999, enables the community to obtain public information and services electronically over the Internet in an interactive manner.

The Electronic Tendering System, or ETS, of the Government Supplies Department, which was launched last month, is a pilot project using the latest Internet technologies. Being one of the first applications to use the Public Key Infrastructure established by the Hongkong Post, ETS will provide a secure electronic means for handling tenders and related matters.

In November 1999, the Lands Department launched the Community Map on the Internet. This is a project which provides useful mapping information to the community through the Internet, free of charge.

In the past few months, the Information Technology Services Department has jointly organised a series of free seminars on e-commerce with the Hong Kong Trade Development Council, the Information Technology and Broadcasting Bureau and the Hong Kong Information Technology Federation. These events enable Hong Kong companies, especially the SMEs, to embark on e-commerce, to explore new markets and to strengthen their competitiveness.

Apart from seminars and exhibitions, we have and will continue to participate in IT campaigns and competitions and produce promotional material on IT and e-commerce.

By implementing these initiatives, the Hong Kong SAR Government aims to create a user-friendly and conducive environment for the development of e-commerce to drive our economic growth.

I wish to express my sincere thanks to our distinguished speakers who are sharing their valuable experience and knowledge with us today. I am confident that you will find the discussions both interesting and fruitful.

Thank you.

End/Wednesday, May 31, 2000