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Following is the speech made by the Chief Executive, Mr Tung Chee Hwa, at the Civil Service Symposium for Directorate Officers at the City Hall this morning (September 4):
Colleagues, Ladies and Gentlemen,
It is my pleasure to join you today at this Leadership Symposium for Directorate Officers organised by the Civil Service Bureau. We live in a rapidly changing world. We need to assist our senior officers in developing advanced knowledge and management skills, with particular focus on strategic thinking, change management and leadership. I am sure you will gain great insight from our guest speakers, from the Principal Officials joining the discussion this morning.
I will take this opportunity to speak to you on the topic of change management of Hong Kong, of the challenge we face in Hong Kong, of the need for Hong Kong to restructure and to reposition ourselves once again in view of the rapidly changing environment around us. And despite the difficulties we face today - sometimes some of these difficulties seem to be insurmountable - we should be confident that we can manage this change and emerge from the difficulties better than ever before.
As I said, we live in a rapidly changing world. The ability to manage this change will be a yardstick with which people will measure how successful we are. Let me first tell you how we have done so far.
When my first term began on July 1, 1997, we were faced with the daunting task of managing the change, the change of Hong Kong from being a British colony to becoming a Special Administrative Region of the People's Republic of China, and to do so under "One Country, Two Systems", a great concept but untried anywhere. How well we have done. How really well we have done. We have turned this concept of "One Country, Two Systems" into an everyday reality.
Managing this enormous change successfully is a very, very impressive feat. I assure you it did not just happen. It happened because a lot of thought has gone into it, a lot of planning has gone into it, and a lot of hard work has gone into it. The fact is that together we have managed that change.
Today, we are called upon to manage another change, another monumental change. The change, although economic in nature, affects all our lives. Indeed, Hong Kong is faced with some enormous challenges. Challenges brought about by the globalisation of our economy; challenges brought about by the arrival of the knowledge-based economy. The successful and rapid development of the economy on the Mainland has given us both opportunities and challenges. We all know today, services and products can be produced across the border at a fraction of our costs here in Hong Kong.
We are also faced with the challenge brought about by the bursting of the pre-97 bubble economy. The cyclical decline in the world economy to an economy like Hong Kong's, which is so externally orientated, has made things much worse. The consequence of all this is that the Hong Kong economy is today stagnant with high levels of unemployment. The consequence of this is also rapid deflation, 13% over the last four-and-a-half years.
From a management of public policy point of view, the decline in government revenue is the outcome of deflation and therefore a larger-than-expected budget deficit. From the view of our citizens, declining advancement prospects, higher unemployment and declining personal wealth as a result of declining asset values, are having a major impact on our community. Indeed, the fact that close to 50% of our working population 15 years old or older have an education attainment level of secondary three or less has made our task much more difficult. Yes, the difficulties may be prolonged. Unemployment may go even higher. The economy may be stagnant for a bit longer yet. But in the face of all these difficulties should we be pessimistic? Let me tell you the answer is absolutely no. I am not being emotional about this. The fact is that we do have many, many competitive advantages, competitive advantages that other cities in the region will be very envious of.
What are some of these competitive advantages? We have an unusually high clustering of talents of professionals, some local, some from the Mainland and others internationally from all over the world, who have chosen Hong Kong as the place for their home, to work here, to provide expert services. You'll find no other city with the clustering we have here in Hong Kong.
We have a very advantageous geographic location. We can leverage on the rapid development of the economy on the Mainland. We have tremendous support from the central government in almost every aspect of objectives we want to achieve. There is "One Country, Two Systems" here. There is the rule of law here, the level playing field, all the fundamental beliefs are here and are stronger than ever five years since the Return. And these are better than any other city in Asia. At the end of the day, we still have enormous fiscal reserves, which is also the envy of many.
And ladies and gentlemen, we have a wonderful civil service. What are we doing today? What we are doing today is to build on these advantages to enhance our position as an international financial centre, as a centre for tourism, a centre for logistics and trade and commerce, a centre for multi-national companies, big and small, who are here to take advantage of our position in Asia, and of course vis-a-vis the Mainland. Of course the much talked about but now a reality is our close and important relationship with the Pearl River Delta. And here I just want to remind you that the economy of Hong Kong and the Pearl River Delta together is today about US$ 250 billion, which is a very large economy. And ten years from now at this rate of growth it will hit US$ 500 billion. And the question is how in Hong Kong we can take advantage of this dynamic economy as we move forward.
Hong Kong's new positioning, and you know this all very well, is that we want to be Asia's World City as well as one of the major cities of China. We need to move up the value chain as we move forward because that is the only way we are going to compete if you look at all the development around us. How do we get there from a policy point of view? Well, continued investment in education is one. Ensuring quality of life for everyone, not just from the point of view of the quality of the air we breathe, the water we drink, or how we treat our sewage, or how we take care of our waste - and these are very, very important. It is also about better greening, more parks, and better use of our empty spaces. If we are going to move up the value chain we need to ensure that innovation and technology are central to some of our policy initiatives.
We also need a government which is more responsive to the needs of the people, especially at a time when things are difficult and this is one of the reasons for the introduction of the accountability system. We also need to ensure that property prices remain stable because property prices affect our economy very, very deeply. We need to create a more friendly investment climate so that more people will invest in Hong Kong. And we need to help out those who are unfortunate, left out in the knowledge economy, not by doling-out but by helping them to help themselves.
How are we going to manage this change? How are we going to make sure all the things we want to happen will happen? Today some of us are somewhat frightened, maybe uncertain. How do we get from where we are today to where we want to be in the future, a World City of Asia? That is our challenge. Together that is our challenge. To manage that change, to move us from here to there is our collective challenge.
Actually, managing change is about constant and realistic evaluation and assessment of what is happening around us and how these events around us may affect us. Managing change is about realistic assessment of our competitive advantages and also of our many weaknesses. Managing change is about developing a vision and new positioning for Hong Kong consistent with our competitive advantages. Managing change is about developing policies, necessary policies which enhance our competitive advantages and, at the same time, overcome our many weaknesses, and in the long run achieve our repositioning. Managing change is about building confidence. And that is really important, it is about building confidence. It is about seeing a strong government. It is about seeing clear-cut policy directions. These are very important indeed. Managing change needs the support of the entire community at large, without which we will not succeed.
And therefore managing change means consultation with the public at large and managing change is about a buy-in by the public of what we want to achieve. Managing change therefore means explaining why there are these difficulties, how they come about, and how we plan to overcome them. Managing change means explaining how change may affect each individual; how, if we do not do anything, it will affect each individual because some of these changes may be painful for some time to come, and how we manage change successfully, will mean to each individual.
Managing change is also about recognising that while we push forward long-term policies - and I have mentioned a few - we need to understand many long-term policies have little immediate impact on individuals, while at the same time the public demand is for more immediate remedial measures to alleviate the difficulties they face, especially those who are more adversely affected.
Knowing some policy objectives will take a long time to materialise, managing change is about demonstrating incremental positive steps, incremental positive achievements every now and then. Maybe only small steps, but that will help bring about confidence that the population at large sees something is happening. Yes, this government is going to take us to where we all want to go. So, these are real tall challenges for us.
As my second term begins we have also begun to manage the process of change, but a lot needs to be done. Are they difficult? They are very difficult. But I am confident, with your support and that of the community as a whole, together we will get there.
You may ask how you are going to get involved in managing this change. Well, from your point of view, managing change, I think, is about thinking outside the box. It's about challenging the status quo; it's about challenging existing processes to ensure greater efficiency, responsiveness and sensitivity in the delivery of service and the implementation of policies. From your point of view, managing change is about how to do more with less. With a looming budget deficit we need to continue to deliver quality services but with less financial resources.
In the meantime, I fully understand that in managing this change the demands on you, the demands on your work, the demands on your responsibilities as leaders of civil servants, will be very, very demanding indeed. I recognise this. I know that greater consultation with you, better buy-in from you, will make the efforts we are trying to launch and to move forward that much better in the implementation to ensure the success of all our efforts. Furthermore, trust and respect are essential in any close working relationship. So I want to assure you that much more will be done together in this regard.
You underpin the governance of Hong Kong. Our civil service underpins the governance of Hong Kong. Over the past five years we have turned "One Country, Two Systems" into an everyday reality. Despite the economic downturn, greater and greater demands from our community, our civil servants have remained clean, resilient, responsive and efficient. I am privileged to lead a civil service, which I have said many times is amongst the best in the world. You, as the top echelon of the Civil Service, play a pivotal role among other things, in serving as role models for all of your colleagues. I call on you for your continued support, to work in close partnership with myself, with the Principal Officials as a team. Together we shall foster an open, enlightened and progressive government dedicated to pursuing the overall interests of Hong Kong.
I wish today's symposium a great success. Thank you very much.
End/Wednesday, September 4, 2002
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