*********************************************************
Following is the speech by the Financial Secretary, Mr John C Tsang, at the inauguration ceremony of Hong Kong branch of Punjab National Bank this morning (January 30):
Dr (K C) Chakrabarty, Distinguished Guests, Ladies and Gentlemen,
Good morning.
Thank you so much for the invitation to join you for this inauguration ceremony. First let me congratulate Punjab National Bank on this major step in expanding its global reach.
PNB has been playing an important role in India's banking industry for more than a century. It is the third largest bank in India in terms of Tier-1 capital, and fifth largest for total assets. It is a household name in India with a wide network of branches and extension counters. With these credentials, PNB's presence in Hong Kong will be a boost to our banking community.
I am delighted that the bank has chosen Hong Kong as one of its first overseas bridgeheads in its global expansion strategy. It is a clear testament to this city・s status as a global financial centre. It is also a move that shows great vision from PNB, given the increasing presence of Indian banks in Hong Kong over the past few years. Since 2005, the Hong Kong Monetary Authority has granted no fewer than seven banking licences to Indian banks.
PNB is now one of 142 licenced banks operating in Hong Kong. As Dr Chakrabarty has mentioned on several occasions, our sound and efficient regulatory environment is a major drawcard for overseas banks setting up shop here in our city. Indian businesses are on familiar ground here because we follow the same common law legal system as India, and English is the lingua franca of our business community.
Recently the US-based think-tank, the Heritage Foundation, again awarded us the distinguished accolade of the freest economy in the world for the 14th year in a row. We have been able to achieve a high score because of our freely convertible currency, simple and low tax regime, free flow of news, ideas and information as well as a commitment to the principle of ：market leads, government facilitates；.
Ladies and Gentlemen, as you well know, Hong Kong has a large and well-established Indian community, which numbers some 40,000. Their entrepreneurial flair is well regarded and has served this city well for many decades. It has also helped to forge strong relations between India and Hong Kong. PNB's presence here will help to better serve customers, particularly in the provision of loans and trade financing as Indian corporations seek to expand their operations or start new enterprises.
There are, indeed, plenty of opportunities, especially given that our two nations, India and China, are regarded as the twin engines driving global growth today. Taken together, India-China and India-Hong Kong bilateral trade already exceeds the bilateral trade between India and the US.
During my visit to India last month, I introduced the advantages of investing and doing business in Hong Kong. Our capitalist society, level playing field for business, open markets, freely convertible currency and global connectivity are all part of the winning formula.
In his Policy Address last October, our Chief Executive announced a new direction for Hong Kong with new opportunities and a new sense of civic responsibility. He set out three guiding principles; firstly, that promoting economic development would be a primary goal. Also that development should be sustainable, balanced and diversified. And last but not least, that development should bring social harmony, with all sectors of the community sharing the fruits of Hong Kong・s success. I am sure PNB will play an important part in helping to take Hong Kong down this new road.
Another focus of my discussions in Mumbai and New Delhi last month was the expansion of our financial services sector. At the end of last year our stock market was the world's seventh largest in terms of market cap, and the third largest in Asia. We have a robust banking system, and we are the largest fund management centre in Asia. Although Hong Kong has not been spared from the global market volatility recently, this has in no way undermined the sound fundamentals of our economy.
We are working hard to develop Hong Kong as a truly global financial centre on par with London and New York, as mentioned in this ：Nylonkong； concept. To do this we have been exploring new markets such as Renminbi banking and debt as well as Islamic finance and commodity derivatives. Recently we launched in Hong Kong the first Islamic retail fund which solicited a most encouraging response from local investors.
I am confident PNB will be eager explorers of these opportunities and more. Once again, Dr Chakrabarty, congratulations on embarking on this new phase of the bank・s development, and I wish you every success in Hong Kong.
Thank you.
Ends/Wednesday, January 30, 2008
Issued at HKT 11:39
NNNN
Windows Media format
Real Media format