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Following is a question by the Hon Lau Kong-wah and a written reply by the Secretary for Commerce, Industry and Technology, Mr Henry Tang, in the Legislative Council today (May 7):

Question:

Regarding the strengthening of cooperation between the service sector in Hong Kong and its counterpart in Guangdong Province following our country's accession to the World Trade Organisation, will the Government inform this Council whether it has studied the possibility of seeking an earlier opening up of the service sector of Guangdong Province to Hong Kong; if it has, of the study results; and whether the authorities will take the initiative to communicate with the Guangdong Provincial Government regarding the opening up of its service sector to Hong Kong; if they will not, the reasons for that?

Reply:

Madam President,

The economic and trade relation between Hong Kong and the Mainland, in particular the Guangdong Province, has all along been very close. With China joining the World Trade Organisation and progressively liberalising its trade regime, the Hong Kong SAR Government has stepped up efforts to promote economic and trade cooperation between the two places, so that Hong Kong businessmen can take the opportunity to expand into the Mainland market.

The HKSAR Government is having discussion with the Central People's Government (CPG) on the establishment of the Mainland/Hong Kong Closer Economic Partnership Arrangement (CEPA) with a view to seeking advanced liberalisation of the Mainland market to Hong Kong businesses. The CEPA covers three areas: reducing and removing tariffs and other restrictive trade measures, further liberalisation of the services market, as well as trade and investment facilitation. Through CEPA, the Government aims to seek better market access for Hong Kong's products and services in the Mainland, including the Guangdong Province.

We note that there are proposals from organisations in Hong Kong that the Government should seek consultations with Guangdong Provincial Government direct on advanced liberalisation of services sectors in the province. However, given that matters relating to market access are centrally coordinated in the Mainland, and that the discussions on CEPA have been led by CPG's Ministry of Commerce (formerly Ministry of Foreign Trade and Economic Cooperation), the Government has not approached, and has no plan to approach, individual local authorities on CEPA and services liberalisation.

Notwithstanding the above, the HKSAR Government has been maintaining close liaison with the Guangdong Provincial Government, with a view to assisting and facilitating Hong Kong businesses in expanding into the Mainland market, including the Guangdong market. For example, through the Professional Services Development Assistance Scheme, the Commerce, Industry and Technology Bureau provides financial support to professional bodies in promoting cross-boundary professional services in the Mainland. The Bureau, together with the Trade and Industry Department, has also set up a consultation mechanism with the Guangdong Provincial Government to discuss issues of common concern to Hong Kong businesses which have set up manufacturing plants in Guangdong, for instance labour regulations in the Mainland. Moreover, the Guangdong Economic and Trade Office of the HKSAR Government, through its close liaison with all levels of governments in Guangdong and their relevant trade and economic departments, has been assisting Hong Kong businesses in collecting first-hand trade and commercial information. All of the above helps Hong Kong business develop in the Mainland.

End/Wednesday, May 7, 2003

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