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Following is the full text of a speech by the acting Secretary for Commerce and Industry, Miss Yvonne Choi, at the opening of the conference "Opportunities for the Business Sector in a Changing Global Business Environment" today (March 1) (English only):

Professor Cameron, distinguished guests, ladies and gentlemen,

It gives me great pleasure to welcome you all to this Conference. We are honoured to have here today so many distinguished speakers to share with us their views on the opportunities and challenges facing the business sector in a changing global business environment, and in particular the implications of China's imminent accession to the World Trade Organisation (WTO).

Globalisation and Trade Liberalisation

In the past century, we have witnessed the power of trade liberalisation and globalisation. Trade liberalisation has opened up new markets and brought about enormous investment opportunities to businesses. Together with rapid technological advancement in the past few decades, the strong forces of globalisation have transformed the conduct of trade and significantly changed the business environment in which businesses operate.

Globalisation is an important force shaping the development of economies in the 21st century. It integrates the world economy by creating a dynamic equilibrium at both international and national levels. Ultimately, no economy can stand isolated and remain self-sufficient in a globalising world.

Conscious of the forces of globalisation and the benefits of trade liberalisation, Hong Kong has always been an ardent supporter of the rules-based multilateral trading system under the WTO. Why? Because the WTO has a twin-mission: liberalisation of trade and rule-making.

The temporary set-back at Seattle in end December 1999 will not and should not stop the multilateral trading system from furthering its mission. We are convinced that a new Round is the best way forward to forestall backsliding into protectionism and sustain the momentum of trade liberalisation. A new Round will also contribute to updating and strengthening the disciplines of the multilateral trading system to ensure that they meet the needs of an increasingly globalised and technology-driven world economy.

Hong Kong's performance in the face of globalisation

So how does Hong Kong, a staunch advocate of free and open trade, perform in the face of globalisation?

Despite the changes and restructuring of the Hong Kong economy in the past decades, we have coped and performed well. The forecast growth rate in real terms of our Gross Domestic Product (GDP) for 2000 as a whole has been revised to 10 per cent or over US$160 billion, recovering reasonably swiftly from the Asian financial turmoil of 1997-98. The forecast for our per capita GDP for 2000 stands at over US$24,000.

Ever since the Index of Economic Freedom was published in 1995, Hong Kong has retained its position as the freest economy in the world for the seventh consecutive year by the US Heritage Foundation.

The FORTUNE Magazine, in collaboration with Arthur Andersen, released recently the annual ranking of cities with the best overall business environment in 2000, and Hong Kong is the best city for business in the Asia Pacific region.

We attracted US$23 billion of total foreign direct investment (FDI) in 1999, ranking second amongst Asian economies after Mainland China (US$40 billion). I believe this trend will continue to grow in the coming years, as Hong Kong will be an attractive location for new foreign investment, especially for those who have an eye on Mainland's market upon her accession to the WTO.

China's Accession to the WTO

The subject of China's accession to the WTO has been attracting a lot of public attention, as she is close to completing her long march towards the WTO membership. With the accession of such a major trading nation, businesses from all over the world, multi-national corporations and small and medium-sized companies alike, will experience yet another major phase of the globalisation process.

A more market-oriented, more transparent and rules-based economy will facilitate further access to this vast market. At the same time, it will also enable the Mainland to integrate into the world market in full gear.

According to the World Bank, Mainland's share in the world's external trade is predicted to double in a space of five years as a result of WTO entry and it will become the third largest economy in the world by 2020. This rapid growth in the share of world trade, coupled with a projected growth in trade volume at the rate of 7 per cent per annum, is likely to mean yet more businesses and opportunities for everyone who does business in the Mainland, including Hong Kong.

Hong Kong's strengths in relation to the Mainland lie in our advanced business infrastructure, professional expertise, wide commercial connections, and ability to package complex and sophisticated deals. The Mainland's increasing integration with the world economy will increase the demand for such services. And Hong Kong is well placed to expand our traditional middleman role.

The private sector has already taken the lead in combining Hong Kong's strengths with those in the Mainland. The cumulative value of Hong Kong's realised direct investment in the Mainland reached US$162 billion at the end of June 2000, accounting for about 50 per cent of total external direct investment in the Mainland. Hong Kong's realised direct investment in our neighbour, the Guangdong Province, accounted for 74 per cent of the total FDI it received as at end-1999. Moreover, the bulk of our re-exports, which accounted for 88 per cent of our total exports in 2000, originated from or was destined for the Mainland. Our re-export trade has grown 18 per cent last year. The outlook for further growth remains strong.

The economic relationship between Hong Kong and the Mainland is a mutually beneficial one. What we need to do is to build on the strong synergy which already exists between the two economies and to maintain our competitiveness in face of the fierce competition from other foreign companies once the Mainland opens up her economy to all WTO Members on a non-discriminatory and most-favoured-nation basis.

Against this background, how will Mainland China's accession to the WTO affect Hong Kong businessmen? What is the importance and relevance of the WTO to Hong Kong businessmen? How can Hong Kong businesses best prepare for the changing business environment?

I hope this conference will provide a forum for in-depth discussions among the many distinguished speakers, panelists, and conference participants on all those and other related issues. I wish you all a stimulating and rewarding event.

End/Thursday, March 1, 2001

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