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Following is the speech by the Secretary for Economic Development and Labour, Mr Stephen Ip, at the Second Asia Pacific Aviation Management Roundtable "Greater China in the New Century: Stronger, Higher, Faster" today (February 19) (English only):

Vice Minister Gao, Mr Maxton, distinguished guests, ladies and gentlemen,

It gives me great pleasure to join you this morning at the opening of the Second Asia Pacific Aviation Management Roundtable. The theme of this roundtable has been well chosen. Indeed, all eyes are now on China for its tremendous potential for stronger, higher and faster growth.

Perhaps no other industry in the world has witnessed the dramatic plunge and comeback in recent years as the aviation industry. The aftermath of 9/11 and the outbreak of SARS have dampened confidence in air travelling. Amidst such adversity, China is one of the few places that still shines. And the prospect looks even more promising now. More competitive Chinese carriers are emerging after a series of restructuring and consolidation. From Beijing to Guangzhou, there are many new or expanded airports. The aviation market has been gradually opening up for greater business opportunities and competition.

As the gateway to China, Hong Kong is well-placed to take advantage of this burgeoning market. Today, 600 weekly services fly between Hong Kong and over 30 cities in the Mainland. Traffic to the Mainland now accounts for one-fifth of the total throughput of the HKIA. Hong Kong's aviation authority is working closely with our Mainland counterpart to ensure the safety standards for air traffic in one of the busiest airspaces in the world. Hong Kong's world-class airport is also entering into cooperation arrangements with airports in the Mainland to create a win-win situation and synergy.

At the same time, we are facing keen competition from other major aviation hubs in the region, both in terms of long-haul and regional traffic. We are not afraid of competition as it drives us to perform even better. I am glad to say that the HKSAR Government and the local aviation industry are working closely together to develop our hub status. We have set in train plans to upgrade Hong Kong's cross-boundary infrastructure to enlarge the catchment area of our airport. We are continuously enhancing the service quality and competitiveness of our airport and actively expanding our aviation network to the Mainland and elsewhere. We are providing a level playing field for local and foreign carriers to serve the overall interests of the travelling public. These are no easy tasks, but we welcome the challenges and will do our best to tackle them.

Ladies and gentlemen, with the rapid growth in air traffic in the region, aviation regulators have the tall order to ensure safe and more efficient air transport. It also calls for further improvements in aviation infrastructure management and more innovative business models from airlines to airport operators. The roundtable today brings together key players in the industry to share their experiences with each other and to explore new ground. Let me take this opportunity to congratulate Aerospace Forum Asia and the Economist Conferences for organising this event. I wish the conference every success and hope that both speakers and participants will find the roundtable a most rewarding experience. For those of you coming from abroad, I wish you a most enjoyable stay in Hong Kong and hope that you will find time to do some shopping and sightseeing.

Thank you.

Ends/Thursday, February 19, 2004

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