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Follows is a speech by the Chief Secretary for Administration, Mr Donald Tsang, at a reception in Paris today (November 22, Paris time) hosted by the Hong Kong Economic and Trade Office Brussels, the Confederation of French Business and the Hong Kong Trade Development Council:

Minister Pierret, Monsieur Perigod, Monsieur Harache, Monsieur Pelletier, distinguished guests, ladies and gentlemen,

It is a great pleasure to be back in Paris. Being a world city also, Hong Kong aspires to the elegance, style and intellectual traditions of Paris. It is, in fact, my second visit to Paris in as many days. I arrived yesterday for a full day's programme that included meetings with President Chirac and senior ministers of the French Government. We then sped off to Brussels for some meetings last night and earlier today with Belgian and European Union political leaders, as well as the business community.

And here I am again, back in Paris, for more meetings and this important gathering tonight. Thank goodness for your high-speed trains - they are absolutely marvellous. And thank you all very much for taking the time out to be with us tonight. I am delighted to see so many people here. To my mind, this reinforces the strength of the links between Hong Kong and France. I hope that during my visit we have been able to boost those ties even further.

Tonight's event, so graciously hosted by the MEDEF, is the culmination of my programme here in France. It provides me with an ideal platform to emphasise the tremendous opportunities for French businesses in Hong Kong, or for French business looking to Hong Kong as a stepping stone to the huge potential of the Mainland China market, or, indeed, to the whole of the Asia Pacific. My formal acceptance today of eight helicopters from Eurocopter - an order worth 104 million Euros - is proof positive of the opportunities I am talking about.

During my meetings with President Chirac, with your government, and in my meetings with journalists and leading businessmen like yourselves I have stressed two key messages.

First : The 'One Country, Two Systems' formula is working well for Hong Kong. As a Special Administrative Region of China we have transformed this unique concept into an everyday reality. Our national leaders have scrupulously honoured their commitment to allow Hong Kong people to run Hong Kong with a high degree of autonomy. The rule of law upheld by an independent judiciary; the free and unfettered flow of information; a level playing field for business; and a clean, efficient administration. All of these remain the bedrock of Hong Kong's way of life.

How do we judge this success? Well, the figures speak form themselves: emigration from Hong Kong is at its lowest level for 20 years. We are attracting record amounts of foreign direct investment - almost 72 billion Euros last year, the highest amount in Asia and amongst the highest in the world. And the number of international companies is at an all-time high. Our latest survey has shown that more than 3,200 companies have a regional headquarters or office in Hong Kong - an 8% increase over last year. Among them more than 130 companies from France. That comes on the back of a 20% increase in 1999 - 2000, which translates to 750 companies setting up regional operations in Hong Kong in the past two years.

Our low taxes, stable political environment, excellent communications and world-class infrastructure and the freest city in Asia were all cited as major factors in choosing Hong Kong. Mainland Chinese enterprises are also looking to the Hong Kong market to raise funds in the international market - almost 5 billion Euros last year. And now that China has entered the World Trade Organisation we expect even greater international interest in Hong Kong. There will be huge opportunities for French businesses based in Hong Kong.

My second key message is that there is tremendous scope for even closer co-operation between France and Hong Kong - between business and government. The French business community in Hong Kong is one of the most active. French consumer products are regarded very highly - from wine, brandy and champagne to fashion and jewellery and automobiles. French service companies, including banks, are gaining ground. French companies have won major contracts for important infrastructure projects, ranging from very large construction jobs to the supply and installation of escalators. The most satisfying aspect of these commercial links is that they encompass a wide range of French companies - from large, international firms right down to the one-man importers of breads or wine.

At the official level, co-operation has been close for many years, and has been increasingly formalised in agreements and exchanges. Agreements in such areas as air services, investment promotion protection, customs co-operation and mutual legal assistance in criminal matters have all been signed since in the past decade.

One of the most important agreements came into effect in April this year, when Hong Kong SAR Passport holders were granted visa-free access to the EU. Of course this would not have been possible without the support of the French Government, for which we are very grateful. I cannot overemphasise the symbolic and practical significance of this vote of confidence in the Hong Kong Special Administrative Region.

This agreement was a vote of confidence by European authorities, including your own Ministry of the Interior, in the integrity of our passport system. And, at a practical level, it has made it significantly easier for Hong Kong tourists and business people to visit Europe. Certainly, from a commercial perspective, visa-free access eliminates one of the hurdles of maintaining close, personal contact between French and Hong Kong business contacts and customers.

It is also an important stepping stone towards closer co-operation between Hong Kong and France in a range of areas, official and commercial.

At the official level, we are working to establish closer working ties on immigration matters, closer police liaison and more information exchange on money laundering issues. Incidentally, Hong Kong recently took over the presidency of the OECD's Financial Action Task Force on Money Laundering at its Plenary Meeting here in Paris in early September.

We also want to do more to facilitate commercial links. The Hong Kong SAR Government's office to the European Union has just launched a web-site tailor-made for the European audience. It will help French business access the wide range of services and information about business opportunities in Hong Kong, including Government contracts.

And there will be an exciting range of contracts going out to tender in the coming years. In his recent annual Policy Address, our Chief Executive C H Tung outlined plans to spend more than 85 billion Euros on infrastructure developments over the next 15 years. There will be major investments in new railways, in new roads, in supporting facilities - areas where French companies have a proven track record of excellence and, importantly, in securing business in Hong Kong.

As these companies will tell you, our contracts are awarded on a strictly competitive basis. Overseas companies compete on the same basis as local companies. There are no added incentives in this sector or that. No special deals. No special treatment. French companies that bid competitively stand as good a chance as anyone.

The Eurocopter deal is a prime example. In a very competitive market they won a contract worth more than 100 million Euros. The contract was to supply not one or two helicopters, but an entire fleet of eight helicopters - three Super Puma L2 and five EC155B helicopters. And I believe this was the biggest non-military order the company had received in the past decade.

I should add that Hong Kong has one of the best reputations in the world for helicopter search and rescue. Our Government Flying Service capabilities will be upgraded significantly with the delivery of these helicopters. In fact, we will be able to double our search and rescue capacity. No doubt, our new helicopter fleet will receive plenty of international exposure in the years ahead. This will not only prove to be a testament to the skill and dedication of our pilots and air crew, but also to the reliability and quality of the machines they are flying.

My distinguished guests, ladies and gentlemen, I do not want to keep you all standing for too long. I sincerely hope that I have been able to impress upon you the great importance that we in Hong Kong place on boosting ties with France and our other European partners. This not only applies to business. It applies equally to closer links between governments, between cultural groups and also in the area of tourism. I believe Hong Kong is the best place in Asia to do business and therefore it is the best place for French business to do business in Asia too.

And now, I have a special duty to perform. It gives me great pleasure to officially take 'delivery' of our new fleet of helicopters. I hasten to add that this is just a model and that two of the Puma L2 helicopters have already arrived safely in Hong Kong and we are expecting delivery of the third within the next three weeks.

Thank you very much.

Ends/Friday, November 23, 2001

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