**************************************

Following is the speech by the Secretary for Commerce, Industry and Technology, Mr Henry Tang, at a luncheon today (July 15) on "Shaping the Future - Design for Hong Kong": (English only)

C K Poon, Victor Lo, Distinguished Guests, Ladies and Gentlemen,

It gives me great pleasure to join you all at today's luncheon.

Today's luncheon is about design. Design goes beyond ideas or something abstract or conceptual. If we look carefully, we will notice a lot of powerful designs around us.

Let me share with you two examples. One is a wide see-through window on a windsurfing sail. Described as "an ambitious attempt to capture the spirit of the sport", the window enables windsurfers to enjoy more thoroughly what is offered by the sport and the nature. Another is a paper-shredder combining pencil sharpener and trashcan. They are in fact gold-winning and silver-winning entries in a recent competition sponsored by an international business magazine. You will see for yourselves how various designs add value to our lives in the magazines which you may collect on your way out after the luncheon.

So, design is about improving our daily lives, in a big or small way. It is about increasing efficiency, adding value to products and services. A good design captures our imagination, puts our dream into reality and makes it part of our daily lives. It is not just a gimmick or adding a pretty face to a product. It deeply entrenches functionality. It integrates creativity, innovation, practicality and feasibility. It embodies taste, quality and style in a repeatable form to arouse affinity. It creates value which consumers demand. In the end, it enhances our competitiveness.

The prowess of design is evidenced by some interesting statistics which I would like to share with you. According to a research by a London Business School economist, Andrew Sentance, an extra one per cent of turnover spent on design and product development will increase a company's profit and turnover by three to four per cent over a period of five years. Design is investment in future, not expenditure foregone.

That is why I attach a lot of importance to promoting innovation and design. I would also like to add that the recent Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) will provide a new platform for integration of innovation and design in the value chain. With the benefits of a zero-tariff Mainland market, industries which are hitherto not economically viable in Hong Kong may discover a new business case under CEPA. CEPA may very well spawn new industries for products with high-value added content or substantial intellectual property inputs. High intellectual content services such as exhibitions and conventions, advertising and audiovisual services also benefit under CEPA. The opportunities are just enormous.

Design is not and never has been a trivial matter in our life. Neither will it be in future. Not only has design been a good way to make a better living for all of us, it also helps to make our economy strong, free and prosperous. I encourage all of you here to harness the prowess of design to accomplish what the event today hopes to achieve ultimately: Shaping our future! Thank you.

End/Tuesday, July 15, 2003

NNNN