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CS' speech at luncheon of American Chamber of Commerce


Following is the speech entitled "Standing Firm In A Changed World" by the Chief Secretary for Administration, Mr Donald Tsang, at a luncheon hosted by the American Chamber of Commerce today (October 15):

Madam Chairman, ladies and gentlemen,

Thank you, Paula, for that very generous introduction. I consider it a special privilege to be among my American friends today at a time when your country has taken the first, determined step in a war against terrorism that is crucial to all of those people around the world - and here I certainly include Hong Kong - who believe in the rights of individuals and countries to live in peace and freedom. And since this is my first opportunity to speak directly with you since September 11, I wonder, Madam Chairman, if I might propose that we stand for a minute's silence to remember those who lost their lives in the appalling crime against humanity which took place in New York and Washington 34 days ago.

Madam Chairman, we are living in difficult and dangerous times, but I do not want to be unnecessarily gloomy or morbid today. I say that because if there is one message that has emerged powerfully from recent times it is about the strength and resilience of the human spirit. As you know, I had flown from New York to Washington just an hour before the first murderous attack on the Twin Towers. I was in my room at the Hay Adams Hotel when I saw smoke rising from the deadly assault on the Pentagon.

For the rest of our lives, we will all carry with us memories of that day, that hour. Having been so close to the tragedy, and sharing the shock and grief I felt - and the people of Hong Kong felt - with Americans at all levels, has left a profound impression on me personally. But I think the most abiding and uplifting memory for me will be the way in which Americans came together at a time of deep trauma; how they reacted with courage and compassion; by their refusal to be overwhelmed by the consequences of the terrible things that had happened to them. Nobody, surely, can be but struck by the unity of purpose of the American people, and their steady but steely resolve to see justice done.

There are lessons in this for all of us. We know that the character of a people is not measured by how well they do in the good times; but how they face up to the challenges of the bad times. In our own small way - and after September 11 all of us have a context for our troubles - the people of Hong Kong have faced some daunting setbacks these past 4 1/2 years since the founding of the SAR. I would like to take the opportunity today to take stock of how we have coped with them, and look ahead to what lies in store for us.

Madam Chairman, I think it is fair to say that not many communities have faced the kind of challenge that was set for the Hong Kong people in terms of the return of Hong Kong to China on July 1, 1997. Given the re-union of the world's most capitalist society and the last major socialist state, there was plenty of room for doubt and skepticism. Not for the first time, Hong Kong has turned history on its head. That is due in large part to the pragmatism and grit of our people, and the bold vision, political acumen and statesmanship of our leaders in Beijing.

I would add one further ingredient : the calm and measured stewardship of C H Tung which has earned the respect and support of those who have entrusted him with turning the concept of One Country Two Systems into a reality. Without that trust and respect, nothing else is really possible. And when people air their grievances and complain about how badly things have gone since the Handover - as people are wont to do in a free and open society like ours - we should occasionally take time to remind ourselves of that simple fact of life.

But have things really been so terrible since 1997? They certainly haven't been easy. I have the scars - and the greying temples - to prove it. However, I guess if you were to ask those who took the decisions to place US$64 billion in external direct investment in Hong Kong last year, or were behind the establishment of the 3,000 regional headquarters now located in the SAR, the answer to my own question is that some people, at least, think that we are doing something right.

But let's look at the backdrop. We are now entering the second major economic downturn we have faced since the Handover. Two in the space of four years in an economy that until 1998 had never known what it was like to have more than two consecutive quarters of negative growth. This has been a huge shock to the system. And in political terms, if Bill Clinton was right when he argued that it's the economy, stupid, we shouldn't be too surprised if the tide of public opinion has not always run the government's way.

Frankly, this is the difficult terrain in which the administration has worked these past 4 1/2 years. It is the architecture which has framed political debate in our community over that time. It has obscured and occasionally skewered our efforts to bed down the vision we as a government have for the future of this remarkable place.

In the hurly burly of day-to-day politics, it has been easy to overlook the fact that from the get-go, the Chief Executive put in place a blueprint for the kind of economy and society he wants to see develop in Hong Kong. An economy which harnesses technology, excellence and innovation to the exacting and ever-changing demands of globalization; a generation of citizens enriched and armed with a dedication to the life-long learning they will need to prosper in a world dominated by the application of knowledge; a decent, tolerant society protected by the rule of law and the institutions of civil society; who have an increasingly greater say in how they run their lives and their community; and, finally, a community at ease with itself and its place - its special place - in its own great country, and in the world at large. This is C H's big picture.

Now, I would be the last to pretend that we have not been buffeted and hammered and even wrong-footed as we have gone about putting these noble ambitions into place. Some people have accused us of being awkward and out of touch or, even worse, cautious and conservative. But I believe any fair-minded observer - and I know there are some out there - will agree that while we have had to drop anchor in safe harbour once or twice, we are still on course for our plotted destination. If you will allow me to mix my metaphors in the play-off season, we haven't taken our eye off the ball.

Let me back that up. I don't propose to give you a long laundry list of achievements taken from my spin doctor's kit bag of bull points. But I'd like to be able to demonstrate to those who think the SAR's bottle is half empty, that it's actually more than half full.

First, and foremost, I would stress once again - I don't think we can emphasise this enough - the success of One Country Two Systems. This is a marvellous achievement. As both a citizen and an official of the SAR government, I take pride in this. I share this pride with my fellow citizens in Hong Kong and in the Mainland.

I take particular pride and encouragement in the fact that we have made this historic transition while preserving the best of everything Hong Kong stands for, the values we share with the western world : the rule of law, which has given us a government of laws, not men, as John Adams put it; a clean, accountable civil service; the free and unfettered flow of information and ideas; and a level playing field which gives all our citizens the same opportunities to exercise their talents and the freedom to pursue their dreams.

I acknowledge that our judicial system has been through a baptism of fire, but I believe it has emerged the stronger for it. It certainly remains true that you can take the government to court in Hong Kong and win your case. My former cook can testify to that.

Second, in the past 4 1/2 years, in the face of the worst financial crisis the region has known in our lifetime, we saved our currency - and, dare I say it - our economy. In the wake of that, we have made sure our game is up to Big League standards. We have further liberalised our banking system and deregulated interest rates; we have merged and listed our stock markets; upgraded our financial markets e-infrastructure. We have led the world with such initiatives as offering payment-versus-payment settlement in foreign exchange; and - after 35 years of debate - introduced an MPF system that will not only provide protection for our ageing population, but inject significant sums into our debt market. I think those of you who work in the industry will agree that, in every way, we can hold our own with New York and London.

Third, we have brought about a revolution in our telecommunications market that makes it the freest in the world. This has brought many benefits, for example, savings of some $9.5 billion for consumers in 1999 and 2000. We have put government services on line 24 hours a day, 7 days a week. We are pushing hard to increase the awareness and use of technology from grannies to their grandkids. Virtually all of our commercial and residential buildings are on broadband. We have the world's highest mobile telephone penetration rate. Hong Kong is wired to the world.

I believe the criticisms of the Cyberport will fade into memory when people see that it provides world-class information infrastructure with its cluster of quality IT companies. And the Science Park, with its research and development capabilities, will add the kind of value we have never had before in providing the catalyst to bring innovative ideas to the market place.

Fourth, an issue that I know concerns you deeply : the environment. Cleaning up our air and water quality is a top priority. 70% of the taxi fleet is now powered by LPG. Ultra low sulphur diesel is the only diesel fuel now available. That's 5 years ahead of Europe's plans for the implementation of this standard. Roadside air quality readings are much better. We will see real improvement in the water quality in the harbour this year when the Harbour Area Treatment Schemes will treat 70% of the sewage coming into the harbour from the main urban areas.

Yes, we know we need to do a lot more, and we are committed to doing so. In this regard, we are talking real turkey with our colleagues in Guangdong to see how we can jointly tackle cross-boundary green issues.

Fifth, our infrastructure. It's only just over 3 years since we opened our magnificent new airport. We are hard at work on Container Terminal number 9. When it is completed in 2004 - and this does come from the bag of bull points - our port will be handling the equivalent of one 'box' every one-and-a-half seconds, 24 hours a day, 7 days a week. If you don't believe me, you have my permission to go out and count them.

You will have learned from last week's Policy Address that we intend to spend $600 billion on our infrastructure over the next 15 years. This is an astonishing figure by any standards, but one that hardly raises an eyebrow in Hong Kong where the very nature of our trade-driven, externally-oriented economy means that we must continue to build or perish. But not at all costs, as the recent decision on the Lok Ma Chau spur line so vividly demonstrated.

What do we work for but to preserve, improve and enhance the quality of life for our children and their children? That thinking lies behind our development of six major railway lines to relieve traffic congestion, and thereby help the environment by bringing more people to within walking distance of an environmentally-friendly railway system. This huge rail building programme is, of course, also part of an integrated network of communications with Guangdong Province and, in particular, the Pearl River Delta, where so much of Hong Kong's post-WTO possibilities and potential lie.

This brings me to my sixth point. I know there are those who write off, or just write down, Hong Kong's future on the basis of a diminishing role as an enabler in China. They see Hong Kong being overtaken by other cities in the region.

I hear you. In fact, I hear a lot about this. But to my mind, such prophets are reading the wrong tea leaves. Nothing changes Hong Kong's location, or our long experience of dealing with the Mainland. And so long as our businessmen display their legendary skills and adaptability in tandem with the physical, economic and political infrastructure we are putting in place with the Mainland, in particular the Pearl River Delta, Hong Kong has every opportunity to write yet another critic-confounding chapter in its unlikely history. It's up to us to seize the moment, or lose the day.

Last, but by no means least, I want to mention education. We have no greater priority in budgetary, social or economic terms. Every parent wants - quite rightly demands - the best education for their children. And of the many changes that have taken place since the Handover, the reform of our education system has been unparalleled. There are big issues on the table : a radical shift from the tyranny of exam-based rote learning; the number and quality of our schools; the resources they have at their disposal; the quality and enlightenment of teachers; the setting of aims and goals to match immediate expectations and long term requirements; the focus on language skills, and how to improve them.

In getting all of this right lies the future of Hong Kong. Our aim, however, is clear : to nurture creative, self-motivated and socially-adept individuals who will lead the next wave of Hong Kong players onto the world stage. We have set ourselves a big goal, because the stakes are so high.

Madam Chairman, in outlining these few achievements and challenges of the SAR government - for they are by no means all - I do not for a moment pretend that we haven't had a rough ride. We have.

We have been dogged by the fallout from the Asian financial crisis and, now, the global economic slowdown and the ramifications of September 11. We have been struck by the forces of nature which have brought in their wake outbreaks of chicken flu and red tide. In passing, it is worth mentioning that in spite of the criticism we took at the time for our handling of the first round of chicken flu, it is now acknowledged - by the Centers for Disease Control and Prevention in Atlanta, among others - that our prompt action almost certainly saved the world from a pandemic that may have claimed millions of lives.

Domestically, we have been haunted by the collapse of the property market as a result of the Asian financial crisis. None of us should underestimate the pain and anxiety this has brought to those who find themselves holding negative equity. Compounding this, some of those same people may have lost their jobs, or fear they may do so as they see the storm clouds of recession gathering on the international horizon.

We have done what we can to help within the restraints of responsible but caring government. The measures announced by the Chief Executive in his Policy Address and by the Monetary Authority and the banks are evidence of that. The whole issue of land and property and housing is vital, and in addressing it, the government has steadily been removing itself from the market. But a nexus that goes back over a century and a half to the colonial beginnings of Hong Kong is, by definition, not easy to unravel.

On that tantalizing note, Madam Chairman, I shall wind up these remarks. I apologise for speaking at such length. But I wanted to take this opportunity to assure members of the American community in Hong Kong - and the community at large - that the administration I serve is committed to the values and aspirations that have long underpinned the success and stability of our community; that we acknowledge the problems we face, but do not shirk from them; that we have a vision of a more progressive, self-assured confident and comfortable Hong Kong if only we draw on our reserves of strength and spirit to see us through our present challenges. And finally, but most important in this latter context, to take inspiration and hope from the unity of purpose shown by the American people in their hour of travail.

Thank you very much.

End/Monday, October 15, 2001


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