Following is the full text of the speech delivered by the Director of Information Technology Services, Mr Lau Kam-hung, in an information technology business forum today (December 7):
Mr Au, distinguished guests, ladies and gentlemen,
I am delighted to be able to address the Millennium IT Business Forum organised by the Asia Information Technology Organisation. The theme of the Forum today is "IT Opportunities in Asia - The Next Ten Years". In the rapidly changing Internet world, I must confess that I have some difficulties in making projections for 10 years! And therefore I shall leave it to renowned experts in the field to talk about their visionary forecast. Today, I want to briefly share with you the various initiatives the Hong Kong Special Administrative Region Government is taking in fostering the development of the information technology (IT) industry locally, so as to help Hong Kong retain its competitive edge and drive its overall economic expansion.
Hong Kong is well known as an ideal place to do business - a free and liberal investment regime, absence of trade barriers, complete freedom of capital movement, well established rule of law, transparent regulations, and low and simple taxation. Indeed, Hong Kong has been rated as the freest economy in the world by the Heritage Foundation in its Index of Economic Freedom for seven consecutive years since 1995. The Fortune magazine also rated Hong Kong as the best city in Asia for doing business. The question is how we should exploit our strengths to meet the challenges of the knowledge economy of the new millennium.
The financial market in Hong Kong has long been acting as an excellent channel for companies to raise capital. To further enhance this function, the Stock Exchange of Hong Kong Limited launched the Growth Enterprise Market (GEM) last November to provide emerging growth companies easier access to the investment funds. Over 60 per cent of the listed GEM companies are related to e-business solution provision, Internet infrastructure and services, and software development.
Today, I believe no one will argue that the Internet is a key to building the knowledge economy. And as you all know, telecommunication links form the backbone of the Internet. In Hong Kong, we have turned competition into almost a new art form. In just a few years, we have liberalised our telecommunications market to the point where it is arguably the freest and cheapest in the world. Coupled with an open, fair and predictable regulatory framework, this has resulted in the rapid development of an innovative and high capacity telecommunications infrastructure which is essential for the flourishing of the Internet and e-commerce in the Information Age.
Our broadband networks now cover all the commercial buildings and nearly 90 per cent of the households in Hong Kong. Our external network connectivity is second only to Japan in Asia. We have one of the most vibrant mobile telecommunications markets in the world with a mobile phone service penetration rate of about 70 per cent, which may be among the world's highest.
Another significant initiative in developing our e-commerce infrastructure has been the introduction of a clear legal framework to provide a secure environment for conducting e-commerce transactions. We took the initiative last year to pass legislation giving electronic records and digital signatures the same legal status as that of their paper-based counterparts. The Ordinance, which has been in force since the beginning of this year, also establishes a framework to promote and facilitate the operation of recognized certification authorities.
We also took the lead in setting up a public certification authority through a government agency, Hongkong Post, to enable early implementation of a public key infrastructure in Hong Kong. Through this system, participants can establish the identity of the other party engaged in electronic transactions; ensure the integrity and confidentiality of the data exchanged; and safeguard the non-repudiation of electronic transactions. But we don't want to have just one single certification authority. We would like to have more certification authorities in the market. And to encourage private sector initiatives in this regard, there are no mandatory licensing requirements for the certification authorities under the Ordinance. Nevertheless, in order to protect consumers' interests and enhance public confidence in electronic transactions, certification authorities are free to apply for recognition from us.
My speech today will not be complete if I do not mention, at least briefly, one of our key initiatives on IT, namely the development of a Cyberport in Hong Kong. The Cyberport is intended to provide a world-class working and living environment for leading IT and information services companies. It will be developed as an ultra-modern intelligent building complex, equipped with state-of-the-art telecommunications and information backbones to meet the needs of such companies. The companies we are aiming to attract are primarily companies applying leading edge IT to create applications, solutions and services and also those adopting innovative ideas to create multimedia contents. Phase I of the Cyberport will be available for occupation in about a year's time. I am glad to say that 15 leading IT and information services companies have signed letters of intent to become anchor tenants of the Cyberport. Over 150 other companies, both local and overseas, have also registered their interests in becoming tenants. We believe that the Cyberport will provide an excellent environment for IT development and create a synergy effect conducive to creative thinking and exchange of ideas among like-minded people.
With China's accession to the World Trade Organisation (WTO) in the near future, our strategic position at the heart of Asia and the gateway to the Mainland of China will be significantly strengthened. Hong Kong is uniquely placed both culturally and geographically to take advantage of China's WTO membership. Coupled with our determined efforts on building a knowledge economy, I hope you will continue to find Hong Kong the best place for IT investment for not only the next 10 years but years to come.
End/Thursday, December 7, 2000