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Following is the speech (translation) delivered by the Chief Executive, Mr Tung Chee Hwa, at the Guangdong/Hong Kong/Taiwan Economic Co-operation Forum today (August 27):
Distinguished guests, ladies and gentlemen,
Let me first extend a very warm welcome to the honourable guests to the "Forum on Economic Co-operation between Guangdong, Hong Kong and Taiwan" today. When I was in Beijing to attend the NPC Conference in March this year, I met with Mr Lu Ruihua, Governor of Guangdong Province, to discuss ways to further strengthen the economic co-operation between Guangdong and Hong Kong, in particular between Hong Kong and the Pearl River Delta (PRD), with a view to attracting more investment from Taiwan enterprises. Taiwan enterprises are important to the Mainland and one-third of their investment is in Guangdong. Governor Lu and I attach great importance to the provision of the best business environment and investment opportunities for Taiwan enterprises. We proposed to organise this forum on a regular basis to enhance communication between our two governments, and to strengthen contacts between Guangdong, Hong Kong and Taiwan enterprises to further improve the investment environment of the PRD. Taiwan enterprises are encouraged to increase investment and expand business by harnessing the advantages of Hong Kong and the PRD. I would like to express my heartfelt gratitude to the Hong Kong Trade Development Council and the Guangdong Sub-Council of the China Council for the Promotion of International Trade for their efforts in making the forum so successful. And, I cordially welcome Mr Chang Hsiao-Yen, Head of the Chamber of Taiwan Businessmen in China who made a special trip here, and all the compatriots from Taiwan and the Mainland to take part in this forum.
The successful implementation of the "One Country, Two Systems" in Hong Kong since reunification five years ago gains acclaim around the world. Our economic and social institutions remain unchanged. Our position as an international centre for trade and business, financial services and shipping industry has been maintained. Hong Kong is recognised as one of the most dynamic cities in Asia and in the world. A continuous inflow of talents and capital to Hong Kong even under the impact of the Asian financial turmoil and the global economic downturn bears testimony to the successful implementation of the "One Country, Two Systems". A large number of residents who emigrated overseas before 1997 returned to Hong Kong in the past few years. Over these five years, we saw a significant amount of foreign capital flowing into Hong Kong, amounting to US$22.8 billion last year.
The biggest challenge we face now is having to manage the sequels to the bursting of the economic bubble created before 1997. We must brace for the new challenges brought by the combined impact of globalization and the rapid economic development in the Mainland. With all these challenges ahead, our economy is undergoing restructuring to re-position ourselves, to give full play to our strengths, and to move up the value chain to maintain momentum and create new areas for our economic development. Hong Kong possesses many advantages amongst other Asian cities. We enjoy a strategic location. We position as an international financial centre, a centre for tourism, a trade centre and a transportation and logistic hub. We must strengthen and leverage on these advantages not only to make Hong Kong one of the great cities of China, but also the world city of Asia, comparable to the status of New York in America and London in Europe. With this vision in mind, we strive to sustain our economic growth and make an even greater contribution to the nation's construction and economic development with the whole PRD.
We are very pleased to have the earnest support from the Central Government in pushing forward with our economic restructuring. Following the relaxation of restrictions on Mainland residents travelling to Hong Kong, in the first seven months this year, we have recorded a total number of 3.45 million Mainland visitors, increasing by 43% over the same period last year, reinforcing our position as the centre for tourism. At present, we are pursuing earnestly our discussion with the Central Government to establish a "Mainland/HK Closer Economic Partnership Arrangement", a form of a free trade area, with a view to maximising the opportunities arising from the rapid economic development of the Mainland, in particular the PRD. We will adopt a full range of proactive measures to encourage and attract companies including Mainland enterprises to be listed in Hong Kong, to push for further development of the Hong Kong capital market, and to strengthen Hong Kong's position as an international financial centre.
To make Hong Kong one of the great cities of China and the world city of Asia, our major task is to enhance co-operation with the PRD under the principle of "One Country, Two Systems". With a total population of some 50 million, the PRD and Hong Kong had a combined GDP of US$250 billion in 2000, ranking No.19 in the world. If our economies continue to grow at the same rate as in the past, in 10 years' time our combined GDP will be over US$500 billion. You can imagine how large the economy will be. Hong Kong and the PRD absolutely have the strengths to become a huge dynamic economic region.
We enjoy a strong rule of law, sound and fair practices in doing business, effective intellectual property protection and good corporate governance. We keep ourselves abreast of the latest world market situation and maintain good international networks. Our position as an international financial centre can assist the PRD companies and Taiwan enterprises that are investing in the Mainland to be listed in Hong Kong, to attract foreign capital for development and to open up new markets. Amidst the economic slowdown, we still have over 100 companies planning for listing this year, of which 50 are from the Mainland and four from Taiwan. We can count more than 3 200 regional headquarters and offices of multinational corporations. Our international air freight and container port throughputs have been ranked first in the world for some consecutive years. Our position as a centre for trade and business, a logistics and transport centre and our pool of talents and professionals, whether they be accountants, lawyers, business professionals and so on, can provide world-class and most reliable services for the Mainland and Guangdong Province, in particular the PRD .
The PRD offers abundance of land, good quality inexpensive labour force, excellent infrastructure and an investment environment that is getting robust day by day. With the implementation of the open policy in late 1970s, we have seen tremendous changes across the country, and amongst all, Guangdong Province has sustained the highest economic growth under the leadership of a strong and effective local government. The rapid advancement in recent years has created great wealth for the people, bringing remarkable improvement to their living environment. After 20 years of rapid growth, the PRD has now evolved into the largest manufacturing centre in the world. Its immense productivity and comprehensive peripheral facilities have made it the world's most important manufacturing centre in electronic products, computer, clothing, toys and watches. It is also a huge market for consumer products and services industry, a market where 50 million people are gaining wealth by the day.
Taiwan enterprises have good experience in managing large production operations, excel in technological research and products development, and are successful in building brand names and opening up international markets. Innovative small and medium enterprises provide a major driving force for the PRD companies to build their own brand names, to open up the Mainland and international markets, and to move up the value chain.
Guangdong, Hong Kong and Taiwan have their many complementary, competitive advantages. I encourage Taiwan enterprises to capitalise on the strengths of Hong Kong and the PRD to expand their investment and develop business in the Mainland and overseas. Joining forces together, Guangdong, Hong Kong and Taiwan enterprises will build the PRD into a dynamic economic region, offering immense business opportunities and creating greater wealth for people of the three places.
To promote economic development in the PRD, Governor Lu and I agree that removing all investment barriers to provide a better business environment is a priority task for our two governments. We will strive to attract talents, enhance the quality of our workforce, improve customs clearance, simplify rules and procedures in doing business and ensure a level playing field. We will provide all necessary infrastructure to smooth the flow of people, goods and capital.
The Hong Kong Special Administrative Region Government regards the strengthening of contacts with Taiwan people and the business sector as of great importance. Since reunification, we have been simplifying the entry procedures for the convenience of our Taiwan visitors, allowing holders of Mainland Travel Permit for Taiwan Residents to stay in Hong Kong for seven days while they are en route to or from the Mainland; issuing multiple entry permits to Taiwan residents working or staying in Hong Kong to allow free travel between Hong Kong and Taiwan; and launching the iPermit Scheme in March this year to provide on-line endorsement. We will also further open up the air services market between Hong Kong and Taiwan. The new air services agreement signed in June this year has brought forth a substantial increase in the number of flights per week. Even so, we are most willing to listen to the views of our Taiwan compatriots to offer them further convenience in doing business or living in Hong Kong.
Ladies and gentlemen, China's accession into the WTO creates new opportunities for strengthening co-operation between Guangdong and Hong Kong, forging a new platform for future development of the two places. Meanwhile, the further opening up of the country has also provided more favourable conditions and opportunities for Hong Kong and Taiwan companies to join forces in doing business. With the goal 'Together we create wealth and prosperity' in mind, we must do all we can to strengthen co-operation to 'make a big family of Guangdong, Hong Kong and Taiwan', and contribute to the development of the Chinese nation. I hope this forum can fulfill the mission to enhance communication between Guangdong, Hong Kong and Taiwan. I also wish to take this opportunity to listen to the valuable opinions of the business sectors of the three places. Let us work together to sharpen the competitive edge of Hong Kong and the PRD, and to make the PRD a prime choice of investment in the Mainland.
Thank you.
End/Tuesday, August 27, 2002
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