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Following is the transcript of remarks (English portion) by the Chief Executive, Mr Tung Chee Hwa, at a media session on Hong Kong's economy at the Conference Hall, 1/F, Central Government Offices New Annexe this afternoon (August 27):

Reporter: Despite very good economic growth figures, unemployment is still about 6%. How concerned are you? And what is it the CEPA agreement this morning could do for the economy?

Chief Executive: You actually asked two questions. I said just now that my primary concern is the high unemployment rate. It's declining, but very, very slowly. And part of the reason, of course, is this unemployment is structural. What I also said is that over the last one year, the economy created 100,000 new jobs. It's a huge number. At the same time, at this moment as I speak, demand for labour in all sorts of areas remains very, very strong. So what I suggest for those that are unemployed at this moment, not to give up, to keep on equipping ourselves better, and go out and look for jobs. I think the opportunities are there. As a government, I think what we need to do is to continue to create an environment so that the economy can continue to grow, and from that point of view, despite some external worries, we are quite confident.

Now so far as CEPA II is concerned, of course, that agreement involves a number of areas, zero tax for goods moving onto the Mainland, professional qualifications, and also in the area of services where the market is now further opening up. Our job in this is to continue to deepen CEPA. The exercise for CEPA II began in January of this year and eight months later we have achieved what we have achieved. We are now already deeply thinking about CEPA III and we are not going to let the grass grow under our feet. We're going to move forward to make sure that Hong Kong's economy will continue to benefit.

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

Ends/Friday, August 27, 2004

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