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The following is a transcript of the Secretary for Commerce, Industry and Technology, Mr John Tsang, speaking to the media after addressing at the luncheon meeting of the Rotary Club of Kowloon East today (August 17):

Reporter: How will the lifting of the quota system affect Hong Kong? Will Hong Kong be the loser or winner and will the Government provide any assistance to the industry?

SCIT: As I was saying, I don't think that Hong Kong will be a loser in the event because first of all, I think a lot of the factories will not just automatically move all their facilities into China for example because a lot of them will want to spread out their risk. They will not want to put all the eggs in one basket. Moreover, we will still continue to allow our manufacturers here to make use of the outward processing arrangement and that helps them to deal with a lot of the more labour intensive aspect of the manufacturing. So I think all in all, Hong Kong will continue to remain a pretty attractive place for the manufacturing of textiles and clothing.

Reporter: So how do you foresee that of the post-quota period? Are you optimistic or pessimistic?

SCIT: I am optimistic.

Reporter: Do you think that the oil prices will affect Hong Kong's export in the next few months?

SCIT: For Hong Kong, we are not a very big oil user. So it probably will not affect us as much as other economies.

Reporter: Can you tell us the measures that the Government will introduce to protect the textile industry after the lifting of the quota?

SCIT: We will announce that when we are ready.

Reporter: Can you tell us about CEPA II?

SCIT: For CEPA II, we have been discussing quite actively with the Ministry of Commerce for a number of months and we expect to be able to announce some significant results in the very near future.

(Please also refer to the Chinese portion of the transcript)

Ends/Tuesday, August 17, 2004

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