************************************************************
Following is the speech by the Chief Executive, Mr C Y Leung, at a business luncheon hosted by the Hong Kong Trade Development Council in Mumbai, India, today (February 3):
Minister Desai, Margaret, Consul General, distinguished guests, ladies and gentlemen,
Good afternoon. This is the second day of our visit to India. Last night from our hotel room I rang my wife and shared with her my experience in India so far, and I mentioned to her the fact that in the year 2014 Hong Kong bought a total of US$8.5 billion dollars' worth of diamonds, and so we visited the Bharat Diamond Bourse. Even I could work it out, US$8.5 billion divided by a population of 7.2 million in Hong Kong works out to be something like US$1,200 per man, woman and child in Hong Kong. My wife quickly assured me on the phone that our household in the year 2014 did not spend that kind of money on diamonds, but she also promised to catch up. It says a lot about the Hong Kong economy, and it says a lot about the fact that we are each other's seventh and eighth largest trading partner.
So, it's a pleasure to be here today, and this is my first official visit to your great country. To be here in Mumbai, India's financial and commercial capital and the heart of the world's biggest film industry.
Big, bigger and biggest are words that go hand-in-hand with India. Indeed, this country - the world's seventh largest in area - will become the most populous nation, and in just six years.
And when it comes to counting opportunity, India's economy, the third largest in Asia, has captured the attention, and the imagination, of the world. A recent feature in the Fortune magazine, predicted that India was, I quote, "set to become one of the fastest-growing major economies in the world over the next several years", unquote.
That, of course, is already a reality, as the IMF noted in its most recent World Economic Outlook report, projecting growth of 7.5 per cent this year for India. That's thanks, in part, to your country's fast-expanding middle class and young consumers, and the retail boom they are propelling.
It's thanks too, to Prime Minister Modi's "pro-business, pro-growth" policies which are the driving force behind India's leap of 16 places in the latest World Economic Forum's Global Competitiveness Report.
I'm here to say that Hong Kong is equally pro-business and pro-growth. In each of my past four years' annual Policy Address I put economy ahead of other chapters. For the past 22 years we have been ranked by the Heritage Foundation as the world's freest economy. In a report just released on Monday, out of the 10 components measured, Hong Kong achieved a high score of 90 or above in seven components, with top positions in the three components of business freedom, trade freedom and financial freedom. The Government of Hong Kong does not own business, you may be interested to know, and so there is no need to worry about competition with government-owned enterprises in Hong Kong.
I'm sure that message was delivered, and clearly, earlier today, in the presentations you heard from some of the 40 senior businesspeople making up our Hong Kong mission to India. They come from a variety of background - aviation, logistics, professional services, banking and financial services, etc. There are also CEOs of Mainland businesses in Hong Kong. They are here with me now, and I know they are eager to talk business with India. With you.
Of course, business between our two economies has long been good, has long rewarded our respective companies and economies.
And when I say "long", I mean "long". Indian businesspeople have played a role in building Hong Kong since the 19th century.
The Indian Chamber of Commerce in Hong Kong opened for business in 1952, and that's a bit older than I am. Today, it counts some 600 members. And many of India's leading companies maintain offices in Hong Kong. Overall, there are around 1,500 Indian companies in Hong Kong in fields such as investment finance, banking, industries, information technology, etc.
The numbers underline our economic ties. Between 2010 and 2014, the average annual growth in our bilateral trade came in at 7 per cent. In 2014, our trade grew by nearly 12 per cent. In merchandise trade, India was Hong Kong's seventh largest trading partner, while Hong Kong was India's eighth largest in 2014.
I'm confident these good results will become better results down the road. Particularly given that your far-reaching "Make in India" programme is rapidly gearing up for business. The initiative, launched nearly one and a half years ago, places priority on partnerships and investment.
Hong Kong has the partners and the investment capital. We have, as well, a great wealth of singular advantages. Taken together, we can help "Make in India" accelerate into the global fast lane.
It begins with our "one country, two systems" arrangement. It offers Hong Kong the best of both worlds.
On the one hand, our special arrangements with the Mainland present us with opportunities no other city in China, no other economy in the world, can enjoy. On the other, we are - like Mumbai - a global city, intimately and inextricably tied to a world of business.
In short, Hong Kong is the global economy's undisputed "super-connector" - bringing together the rest of China and the rest of the world, and that definitely includes India. This role is underlined by the fact that many key members of the Hong Kong business delegates here today are top executives of China state-owned and other Mainland Chinese businesses based in Hong Kong.
Today, nothing says Hong Kong more than our prowess in financial services. China's international financial centre, Hong Kong is also one of the world's leading international capitals - long ranked third behind only London and New York in the semi-annual Global Financial Centres Index, and financial services as a sector contributes no less than 16 per cent to our GDP.
Indeed, as an investment banker was quoted as saying in the most recent Global Financial Centres report, "The big banks all need to be in London, New York and Hong Kong at the very least." That India has 12 full licensed banks and one deposit-taking company based in Hong Kong again underlines that statement.
Hong Kong attracts a world of business, trade and finance; nearly 8,000 overseas and Mainland companies maintain offices in Hong Kong. And not only because of our unique ties to the Mainland of China. No less important, they count on Hong Kong because they trust Hong Kong. Because they know that capital, information, trade and people flow freely in and out of Hong Kong. That there is a level playing field for all business in Hong Kong, no matter where you come from, what background you have.
They do business in Hong Kong because our tax system is low and our communications and logistics infrastructure world class. They look to Hong Kong because our legal system is based on common law, our judiciary independent, and our intellectual property regime nothing less than reassuring.
Add it up, and what does it mean? What does Hong Kong have to offer Indian companies? To start with, investment capital.
I know that India's plans for infrastructure investment are huge, with US$1 trillion earmarked as part of the country's 2012-2017 Five-Year Plan.
Hong Kong can help finance India's future, in infrastructure and much more.
Few economies attract more foreign direct investment or make more FDI available than Hong Kong. Indeed, in 2014, Hong Kong ranked second, internationally, in the FDI it drew; we also placed second in FDI outflow.
Last year, too, Hong Kong ranked first globally, in initial public offerings raised. Other than public offerings, we have the expertise and capacity to arrange a diverse range of fund-raising options, including syndicated loans, private equity, and even Renminbi bonds.
Indian companies are particularly welcome to make use of our Renminbi bonds. To date, seven banks and corporations from India have issued Renminbi bonds in Hong Kong.
Our Renminbi status will soon become even more visible, thanks to the International Monetary Fund's recent decision to include the Renminbi in its Special Drawing Rights basket, beginning in October.
Mrs Laura Cha, our Chairperson of the Financial Services Development Council, has just shared with you her thoughts on how the financial services industry could help you.
Other than financial services, I know that infrastructure development such as railways, roads and transport in general are also among India's priorities.
Hong Kong boasts one of the most advanced, cost effective and safe transport networks in the world. Our subway system, MTR, alone carries an average five million passengers every weekday. It will also be managing Crossrail of the United Kingdom, 118 kilometres long, the largest infrastructure project currently in Europe upon its completion, due for 2018. MTR will also set up an academy to train personnel in rail management and operation, and we are happy to share our experience and expertise with India. The CEO of MTR, Mr Lincoln Leong, is one of our delegates, and he would be happy to help.
Our Hong Kong port is also consistently among the world's busiest container ports in terms of throughput. Some 350 container vessel sailings take place each week to more than 500 destinations around the world.
Given the heavy traffic, I am sure you won't be surprised that we are also an international maritime services centre, flush with more than 700 companies. They offer an exceptional range of maritime services, from ship management and agency, to ship finance, maritime insurance, maritime legal services and arbitration. They would be happy to work with you, and explore business opportunity together. Among our delegates is the Chairman of the Hong Kong Shippers' Council, Mr Willy Lin. I am certain he would be happy to answer your questions.
We have 21st century infrastructure, and we also have world-class professionals, from engineers and surveyors to architects, designers and planners. All of which Hong Kong has in abundance. All of them are eager to help with Indian business. Mr James Law, an architect and a member of my business delegation, has recently completed a project in India, and I am glad that I had the opportunity to tour around the building yesterday.
Ladies and gentlemen, I am truly overwhelmed by the level of interest on the Indian side in our visit. To reciprocate, I would like to encourage an Indian business delegation to Hong Kong, and we would be more than happy to arrange a high-level round-table meeting for business leaders from both sides in such sectors as finance, infrastructural development, urban development, logistics, and merchandise trade. Hopefully, this would pave the way for broader and deeper co-operation between our two economies. I am sure that would be rewarding for all of us.
My thanks to the Hong Kong Trade Development Council for organising today's business luncheon. The Council, by the way, has an office right here in Mumbai. So, too, does Invest Hong Kong. Both are keen to work with you to help realise a promising future - a promising future for Hong Kong and India.
Thank you very much.
Ends/Wednesday, February 3, 2016
Issued at HKT 18:54
NNNN
MP4 format