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Speech by SFST at launch of the Global Edition of the
Financial Times Fund Management

Following is a Speech by the Secretary for Financial Services and the Treasury, Mr Frederick Ma, at the launch of the Global Edition of the Financial Times Fund Management (FTfm) today (October 3, 2005 (English only):

John, distinguished guests, ladies and gentlemen,

     It gives me great pleasure to join you today in launching the global edition of the Financial Times fund management (FTfm) weekly supplement. Some of you probably know that I am a loyal reader of the FT. I find it both lively and informative. Indeed, the FT and a cup of coffee are my best partners in the morning.

     FTfm has been a great success in Europe in the past few years. Produced for business leaders, fund managers, consultants and investors, FTfm is the largest fund management publication in Europe, with the highest readership. It provides news, features, reviews, ratings and opinions, as well as interviews with the fund industry's key players. With Asia's fund management industry developing at an amazingly high speed, reliable sources of financial information and insightful analysis of the fund industry are in high demand. The FT's decision to publish a global edition of FTfm, with enhanced Asian content, is certainly great news for Asian readers. I am pleased to see the FT attaching such great importance to the Asian fund management industry.

     As many prominent business leaders have pointed out, the savings rate in Asia is pretty high in comparison with many other places in the world. As an international financial centre situated at the heart of Asia, Hong Kong is uniquely positioned to tap into these savings and develop into a world-class asset management centre. Indeed, we are already a major asset management centre in the region. Last year, total assets of our fund management business increased 23% to HK$3,618 billion -- and nearly two-thirds of that was sourced from overseas investors.  

     Hong Kong's development as an international asset management centre is premised on a number of fundamental strengths, including-

* rule of law supported by an independent judiciary;
* a well-established financial infrastructure;
* a robust and effective regulatory regime;
* a rich pool of talent;
* a stable currency;
* no currency control and restriction on capital flows; and
* a low and simple tax regime.

     The potential to continue the expansion of Hong Kong's asset management business is substantial, given the vast pension scheme assets held by banks, fund managers and insurance companies in Asia, coupled with the continued growth of personal savings in the Mainland.  

     Hong Kong is committed to providing an environment that supports a world-class fund management industry, and I believe, we are succeeding. To furnish a favourable habitat for the fund management industry to grow strong here, the Government has proposed to exempt offshore funds from profits tax and to abolish estate duty. We are confident that these measures will strengthen our competitiveness as an international financial centre, attracting more international investors to invest in Hong Kong's financial markets and make use of the services provided by our financial institutions, in particular our fund management industry. It will certainly encourage more and more global fund houses and professionals to come to Hong Kong, further expanding the critical mass of our fund management industry.  

     Another key factor supporting the further development of Hong Kong's fund management business is the rapid economic growth in the Mainland which has greatly expanded personal savings and thereby increasing demand for investment products. Given our proximity, our linguistic and cultural affinities, our knowledge and our close relationships - combined with the pillars of Hong Kong's success as mentioned above - Hong Kong is best placed to serve as the preferred asset management centre for the Mainland. The HKSAR Government will continue to look for ways that we can assist the industry to capitalise on the opportunities that arise.

     Ladies and gentlemen, I do not wish to take up any more of your time. I congratulate the FT on the launch of the FTfm global edition, and I wish you all an enjoyable evening.

     Thank you very much.

Ends/Monday, October 3, 2005
Issued at HKT 19:52


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