***********************************************************
Following is the speech by the Chief Secretary for Administration, Mrs Carrie Lam, at the 4th Hong Kong Australia Business Association National Cathay Pacific Business Awards 2015 in Sydney today (September 18):
Mr Peter Sinn, The Honourable Philip Ruddock, The Honourable Gladys Berejiklian, The Honourable Ernest Wong, Consul General Li Huaxin, distinguished guests, ladies and gentlemen,
Good evening. I am delighted to join the Hong Kong Australia Business Association (HKABA) Business Awards Gala Dinner and, of course, to meet the many people who have contributed to close business ties between Australia and Hong Kong. I am very pleased to be in Australia, to renew and reinforce our long-standing friendship.
Tonight here in Sydney concludes my six-day three-city official trip to Australia, as guest of the Australian Government, hosted by the Hon Julie Bishop, Minister of Foreign Affairs. Yesterday, I met about 100 friends from Hong Kong who come here to work or study, and was glad to know that they enjoy their life in Australia. Just a little fact for you to illustrate our strong people-to-people connections: indeed, we have close to 80 000 people of Hong Kong origin living in Australia, with around half of them in New South Wales. At the same time, about 90 000 Australians live in Hong Kong, making our city host to the largest Australian expatriate community in Asia, and that is almost a double than it was 15 years ago. Both groups are targets in our latest efforts to attract more talents to Hong Kong. For expatriates working in Hong Kong, we have relaxed the stay arrangements. And a special scheme has been introduced to attract the second generation of the Hong Kong people emigrating abroad to return to Hong Kong.
Now turning to tonight's Business Awards, first of all, a big thank you to the HKABA for organising the Awards and all the good work you do to promote business between Australia and Hong Kong. This is not an easy award - to be distinguished from other worthy award candidates, who are winners of the State-level Business Awards, the awardees, to be announced shortly, are beyond doubt deserving. I am glad to see a new award category this year for young professionals to encourage them to strive for excellence. Congratulations to all the awards winners.
I notice that the first two awards to be presented are in the areas of import and export of goods and services. All candidates have indeed contributed significantly to the increasingly close trade relations between Hong Kong and Australia. As a matter of fact, there has been a cumulative growth in bilateral trade of more than 33 per cent over the past 10 years. In 2014, our bilateral trade in goods and services reached over AUD8.5 billion.
I am sure that among the candidates for the Awards, there must be some in the food and beverage sector. Hong Kong people certainly appreciate the quality of Australian goods. In fact, Hong Kong is the second largest market for Australian fish and crustaceans and largest for prepared or preserved seafood such as canned abalones. Australia is also Hong Kong's largest source of chilled beef and second largest source of wine after France.
Hong Kong and Australia are each other's seventh largest trading partner in services. The top components of services exports to Australia were transport services, travel services and, of course, financial and other business services.
As the Hong Kong SAR Government is the majority shareholder of Hong Kong's super-efficient metro operator, the MTR Corporation (MTRC), I am proud to say that MTRC is undertaking the Sydney Metro Northwest project, the first stage of the Sydney Metro, which will be the first fully-automated metro rail system in Australia. It also has a large stake in Metro Trains Melbourne. The management of metro operations is certainly an important export of services from Hong Kong.
When talking about service industries, it is difficult to omit tourism. Australia has been attracting more and more visitors from Hong Kong. When comparing the number of Hong Kong visitor arrivals in Australia in 2011 to that in 2014, there is a prominent increase of over thirty per cent, that is more than 50 000 persons. At the same time, there were about 600 000 visitors from Australia visiting Hong Kong.
These are just a few examples of the close links between Hong Kong and Australia. And the outlook for even closer ties is very promising. I am sure you will agree that Hong Kong is the place to do business if you have an appetite for the Mainland China market.
Hong Kong consistently ranks high in the world's leading surveys of best business cities. We have topped in the Heritage Foundation's Index of Economic Freedom for 21 years in a row. We have a free and competitive economy. English is one of Hong Kong's official languages. Free flow of capital, free trade, free market principles and free flow of information are Hong Kong hallmarks. We practise and uphold the rule of law, which is based on the English common law, on which the Australian legal system is also based. We have an independent judiciary. The Hong Kong SAR Government is clean, transparent and accountable. Intellectual property is strongly protected. All regulatory regimes are based on international standards. We offer a level playing field for all. So everyone gets a fair go.
What's more, Hong Kong has a simple tax system. There are no foreign exchange controls, no value added tax, no sales tax or no capital gains tax. We have abolished estate duty and wine duty some years ago. Corporate profits tax is capped at 16.5 per cent. Only Hong Kong-sourced income is taxable; income from elsewhere is not. We have the real advantages for doing business.
Strategically located, Hong Kong also hosts some of the world's biggest trade shows. Foreign business delegations can take advantage of them to reach out to buyers from Hong Kong's large consumer base, as well as from Mainland China and around the world.
That is why Hong Kong stands as the preferred place in Asia for international companies to establish a business or set up offices. At present, there are 550 Australian companies in Hong Kong, while another 1 000 Australian companies have a representative office with us, large or small.
Talking about small and medium enterprises - SMEs - there are 320 000 of them in Hong Kong, amounting to ninety-eight percent of the total number of local enterprises. SMEs are the collective pillar of Hong Kong's economy and our Government offers them multi-faceted support, from consultation to financial assistance to start-up and marketing support. In his annual budget speech delivered earlier this year, our Financial Secretary promised to inject HK$1.5 billion into the SME Export Marketing and Development Funds to enhance the competitiveness of our SMEs.
Our powerful business and financial edge is reinforced by the Hong Kong SAR's deep and special connections with Mainland China. Under the "one country, two systems" principle, we are uniquely positioned as a "super-connector" between Mainland China and the rest of the world.
Hong Kong is, in fact, the most important investment conduit for Mainland China. In 2013, inward direct investment from the Mainland to Hong Kong totalled AUD570 billion - 32 per cent of the total. Similarly, outward direct investment from Hong Kong to the Mainland was AUD690 billion - that's a huge investment from little Hong Kong. In fact, that's nearly half of Mainland China's total direct investments.
As the world's premier offshore Renminbi business centre, Hong Kong also plays a key role in the internationalisation of the Mainland currency. In 2014, RMB trade settlement handled by banks in Hong Kong grew 60 per cent year on year to reach a massive 6.3 trillion RMB. For Australian companies looking to RMB trade settlement, the Hong Kong advantage is obvious.
And we have the Shanghai-Hong Kong Stock Connect. Launched last November, it directly connects the stock markets of Hong Kong and Shanghai, enabling investors from all over the world to trade in some 570 Shanghai-listed shares, directly, through the Hong Kong Stock Exchange. We are now working on the Shenzhen-Hong Kong Stock Connect.
We have the Mainland and Hong Kong Closer Economic Partnership Arrangement, or CEPA for short. This special free-trade pact, which is the most preferential free trade agreement signed by the Mainland China, enables companies based in Hong Kong to enjoy various tariff-free privileges, thereby gaining easy access to the Mainland market. Best of all, CEPA benefits are nationality neutral. That means Australian investors can make use of a host of CEPA benefits to take advantage of China business in a very wide range of sectors by setting up a company in Hong Kong, partnering with, investing in or even acquiring service suppliers in Hong Kong.
As a supporter of free trade, we are supportive of the early implementation of the recently signed free trade agreement between Australia and China. This will bring more business and investment opportunities for Hong Kong. Besides, we believe that a separate Australia-Hong Kong free trade agreement will facilitate further free flow of goods, services, investment and people between the two places, bringing about significant economic and strategic benefits. We hope to see positive progress in this matter.
Ladies and gentlemen, Hong Kong is geared to make it easy to do business. Not only in Hong Kong, but also with the Mainland, in the region, and the world. That's why the World Bank's Doing Business Report 2015 ranked Hong Kong the third easiest place in the world to do business. That's why Hong Kong was again voted "Best Business City in the World" in the Business Traveller Asia Pacific magazine's latest readers' poll.
So, in closing, I would like to invite the clever and ambitious business people gathered here tonight to explore more Hong Kong's lucrative potential. And those who have not done so already, why not consider setting up shop in Asia's best business city?
I wish you all a wonderful evening. Thank you very much.
Ends/Friday, September 18, 2015
Issued at HKT 19:35
NNNN
