Following is the full text of the speech (English only) by the Financial Secretary, Mr Antony Leung, at the Hong Kong Society of Accountants Annual Dinner 2001 tonight (October 26):
Andy (S C Lee), distinguished guests, ladies and gentlemen,
It is a great pleasure to join you tonight. The Hong Kong Society of Accountants has done an enormous amount of good work since it was established in January 1973 as the self-regulatory body for the accountancy profession. On the day of its establishment, the Society's first president Gordon Macwhinnie remarked that: "I know this organization has a great part to play in the future development of prosperity of Hong Kong."
How right he was. Since then, Hong Kong has developed from a manufacturing centre into a major services economy, and one in which financial services play a vital role. This transformation would not have been possible without a broad and deep pool of experienced and talented accountancy professionals. Accounting services has been one of the fastest growing professional sectors in Hong Kong. The number of professional accountants tripled in the past ten years. The profession certainly will continue to play a great part in Hong Kong's ongoing development as a services and knowledge-based economy.
As many of you know, the ledger books are now reflecting an obvious slowdown in the global markets. The terrorist attacks in the US and the aftermath have added to the uncertainty. Hong Kong is now facing an accelerated slowdown just as we were getting over the worst of the Asian financial crisis. Unemployment is on the rise. And naturally, the professional services sector will also have to make some adjustments.
In this economic environment, it is essential for Hong Kong to maintain its competitiveness. One way to do that is to add value to everything we do. In this regard, the Chief Executive announced in his Policy Address earlier this month the establishment of a $100 million fund to support, on a matching basis, useful projects that can enhance the standard of professional services in Hong Kong and increase the competitiveness of the professional services sector.
The Commerce and Industry Bureau will be consulting relevant professional bodies, including the Hong Kong Society of Accountants, on the basic framework of this funding scheme. They will then seek funding approval of the Legislative Council in the next few months. I do hope that we will receive some submissions from the accountancy profession, so that the scheme would better meet your interests.
While doing what we can to promote professional services in Hong Kong, we are also trying to encourage the export of our expertise, particularly into the Mainland market. For instance -
* The Government has been providing professionals with updated information on economic and trade matters, regulatory laws and policies in the Mainland;
* We keep Mainland authorities informed of difficulties faced by Hong Kong professionals doing business in the Mainland and endeavour to iron out problems;
* Our Beijing Office has collaborated with professional bodies like the HKSA to organise seminars in Mainland cities to promote Hong Kong's professional services. This will be an ongoing initiative; and
* We are working with professional bodies to set up a web-site to promote Hong Kong's professional services. And, we will also produce a top-quality video to promote our professional services in the Mainland.
Make no mistake, Hong Kong does have a firm advantage in competing in the Mainland. We know their language and culture, and we have established a vast business network over the years. Hong Kong companies are already the biggest external investors in the Mainland, to the tune of some eighty billion US Dollars. Hong Kong is also the largest exporter of accounting services to the Mainland.
I applaud initiatives by the HKSA to enhance co-operation between the accountancy professions in Hong Kong and the Mainland. This is a must for our continued long-term development as a services centre for the Mainland as well as the rest of East Asia.
While the professions take the lead in promoting their own services and looking for new, value-adding inroads into existing and emerging markets, Government stands ready to provide facilitation as far as possible. In this regard, Government looks forward to working closely with you all.
Whilst market expansion is one way to reinforce our status as a major international business and financial centre, we must also continue to maintain, and indeed bolster our fundamental strengths, such as through improving the transparency and corporate governance of our market.
We already have a sound legal system that is tried, tested and trusted by our international business partners. This is one of our greatest strengths. This is a major advantage we have over many of other Asian jurisdictions. We also have an efficient and effective regulatory regime that is one of the best in Asia. But we need to further strengthen our regulatory regime to bring it in line with other international financial and business centres. This is a necessity if we want to attract more quality players to our equity markets - issuers, investors and intermediaries.
We are currently updating our securities legislation to enhance market transparency and combat corporate misconduct and fraud. Stock Exchange listing rules are being improved to enhance disclosure and streamline enforcement. And the Standing Committee on Company Law Reform is carrying out a phased review of all aspects of our corporate governance regime. The first phase attracted many submissions. The Standing Committee will study them carefully and come up with some concrete recommendations, hopefully to be implemented starting from next year.
But good rules and regulations are just one of the prerequisities of a good market. People is an equally if not more important element. The accountancy profession is in the forefront in promoting good corporate governance in Hong Kong. You are pivotal to maintaining the highest standards and integrity for our market.
I am grateful that the HKSA has done much in this respect, for example, by participating in the review of the corporate governance regime; by bringing the Hong Kong accounting standards in line with the International Accounting Standards; and by publishing a series of corporate governance publications.
The Best Corporate Governance Disclosure Awards to be announced later tonight is of course another shining example of the Society's excellent efforts. It rewards well-managed and accountable companies for their outstanding professionalism. I offer my sincere congratulations to all the winners, and a special vote of thanks to the HKSA for organising these Awards. I commend your vision.
We are in a globalised world. We must stay competitive. Hong Kong thrives on promoting the best practices. Hong Kong thrives on being a centre of excellence. Let's work together to keep up the good work.
End/Friday, October 26, 2001