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Following is a speech by the Acting Secretary for Information Technology and Broadcasting, Ms Eva Cheng, at the "B2B Partnerships in the New Economy" Seminar this (June 16) morning:
Chairman, Minister Hewitt, Sir Andrew, Ladies and Gentlemen,
I am delighted to have a chance to speak at this morning's seminar.
To speak after Ms Hewitt is such a hard act to follow, in two senses. First, she has in the last fifteen minutes, shared with us the UK Government's e-commerce agenda, UK's competitive advantages, technological capabilities and how they are applied in the B2B environment. And convincing us that this is the right way to go. Secondly, I hope you all realise how powerful she is. She sent 13 global communications companies toiling, and sweating week after week in March and April earlier this year, going through some 150 rounds of auction and finally delivering 22 billion pounds to the UK Treasury in return for five Third Generation Mobile Phone licences. She also sent telecommunications ministers around the world scrambling to review their 3G licensing strategies. In Hong Kong, Ms Hewitt, the debate is as hot as ever, because of the UK experience. I suppose she is standard-setting in a sense that telecommunications ministers are now also judged by their revenue earning ability. So apart from working to become Asia's most liberalised telecommunications regime that is pro-competition and pro-consumer, like it or not, we have one more goal-post set for us.
Knowing that the UK is a pioneer in fostering an e-commerce friendly environment and an active programme to assist SMEs in this area, I did some homework on what the UK is doing, and what we are trying to do in Hong Kong to position ourselves as the e-commerce centre of the region. I was most gratified to have found stark similarities.
Telecommunications Infrastructure
Both places are committed to ensuring that the telecommunications market is truly competitive so that prices for Internet access and all forms of telecommunications are affordable and customers have top quality service. Hong Kong boasts Asia's most competitive telecommunications market with five fixed line operators; five new operators using wireless technology to deliver broadband services. Broadband coverage is 100% for commercial buildings and over 80% for domestic households, all driven by the private sector. The scene is just as encouraging for external connectivity : 31 external facilities operators are licensed or about to be licensed to operate satellite and cable facilities. For mobile, we already have six 2G operators and a penetration rate of 57%, the highest in Asia. And as I said, we are working hard to ensure that 3G is just as competitive.
Government-on-line
The UK Government sets itself the aim of being a leading-edge user of new technologies. In Hong Kong, our business community shudders when the Government says it is leading edge, so we toned down our mission a little bit : the Hong Kong Government should set a good example in offering its public services on line. We have an aggressive programme. In October this year, 37 types of services, including payment of government fees, submission of tax return, voter registration, driving and vehicle licence renewal, will be available on line. This is only Phase I of the programme, which we call the Electronic Service Delivery Scheme. Our aim is to roll out ESD to all government services which are amenable to the electronic mode of delivery. A lot of tax payers' money will be saved with the efficiency ESD brings. But more important, as Government has a large client base (some of them being captive clients in the happy case of payment of bills and taxes), we think ESD will provide good momentum to the development of e-commerce. In addition, the system we are constructing is an open platform that can allow other private on line services to ride on it so that we can maximise the benefit of ESD and enrich its content to ensure that it is attractive to users.
The Legal Framework
To make sure that the telecommunications infrastructure is world class and to set a good example is not enough. Ms Hewitt has mentioned that the UK has passed the Electronic Communications Act 2000 to provide the legal framework for electronic transactions. In Hong Kong, the Electronic Transactions Ordinance was enacted in January this year to provide a secure environment for electronic transactions too. The same legal status will now be given to electronic records and digital signatures as that of their paper-based counterparts. This will give the community much needed confidence when transacting on line. Government is required to accept electronic submissions made under law. Out of a total of 44 000 statutory provisions in Hong Kong's law books, only 200, less than 0.5%, have been granted exemptions from the electronic process, for technological or other reasons. The same Ordinance also provides the legal framework for the setting up of a public key infrastructure supported by the operation of certification authorities (CAs). The first CA, the Hong Kong Post, commenced operation also in January this year.
Also, last week we have passed the Telecommunication (Amendment) Ordinance with a view to enhancing competition safeguards, improving interconnection and access arrangements for telecommunications services and streamlining licensing procedures.
A culture that embraces IT
In promoting e-commerce, we are acutely aware that it is not so much about adopting new technologies. It requires an attitudinal change. And for the community to embrace the opportunities in the Information Age, much needs to be done to ensure that no one is deprived of the chance to get on line because of a lack of means. We have installed computers with Internet connection in our District Offices, community halls, post offices, libraries and social centres for public use free of charge. We call this the "cyberpoint" project. We hope this goes some way to address the issue of "digital divide". We recently further expanded the scheme to develop Cyberpoints with specially designed facilities to cater for the needs of the blind and the visually impaired.
The work force too must be adequately equipped. We are in the midst of implementing a five-year strategy on "Information Technology for Learning in a New Era". Simply put, we aim to use IT to turn our schools into dynamic and innovative learning centres. This helps to foster a favourable environment for students to develop the right attitude and abilities in life-long learning, so that they can use IT to meet the challenges in their studies and in their work in future. In terms of higher education, about 19 000 or 23% of our full time degree-level students are studying in IT-related fields and a further 17 000 students receiving vocational training in IT at the sub-degree level. A recent master degree programme on e-commerce was over-subscribed by over ten times. It shows how hungry Hong Kong people are to upgrade themselves and how aware they are of the dire consequences if they are left out in this very important area.
SMEs
A recent survey shows that 40% of our SMEs are already adopting e-commerce in one form or the other. We will work further to enhance the knowledge of our SMEs and encourage them to adopt e-commerce. Two of our key initiatives may worth highlighting. First, the holding of sector-specific seminars inviting companies which have successfully adopted e-commerce to share their valuable experience and insights with their counterparts within the sector. Secondly, the development of readily affordable web-based e-commerce solution packages by industrial support organisations for use by SMEs on a subscription basis. As the systems for the packages are centrally managed by these industrial support organisations and the development cost is shared by the subscribers, this reduces the barriers for SMEs to adopt e-commerce.
Hong Kong's potential as the e-commerce centre of Asia
With our advanced telecommunications infrastructure, readiness to accept new technologies, entrepreneurial qualities, bilingual capability and expert knowledge about the operation of the China market, Hong Kong is well poised to become an e-commerce centre of Asia, with focus on the Mainland market. We have yet to capture the figures of e-commerce from regular surveys, but as an indicator of the intensity of activities, an average of about 100 commercial portals are launched in Hong Kong per month. The potential is enormous in the Mainland market. There were about 9 million Internet users in the Mainland by the end of 1999 and according to an industry estimate, this figure is expected to grow to over 30 million with a total e-commerce spending of up to US$12 billion by 2004.
International Co-operation
We are really grateful for the chance to exchange views and share experience with you, Ms Hewitt, and your team. Since the two Governments signed a Memorandum of Understanding on Co-operation in Information Technology and Services and Telecommunications in June last year, we have stepped up our collaborative efforts. This visit is an excellent example of bi-lateral co-operation built on the MOU. I am grateful for the UK team's visit, bringing a lot of insight and wisdom in B2B partnerships to us.
Enough talking. Let's start learning from the real experts.
Thank you.
End/Friday, June 16, 2000
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