Mr Mak, Mr Ho, distinguished guests, ladies and gentlemen,

Let me start by thanking the Asia Pacific Life Insurance Council for inviting me to open your 1997 Congress. On behalf of the Hong Kong Special Administrative Region Government, I welcome you all to Hong Kong at this significant juncture of Hong Kong's history - just eight weeks after the historic return of Hong Kong to the People's Republic of China.

It is indeed Hong Kong's great honour to play host to this prestigious international event. The fact that you have chosen to hold your congress here is I believe a vote of confidence in Hong Kong as an international business centre.

The holding of your Congress here has provided an excellent opportunity for you to see for yourselves that it is business as usual in Hong Kong wherever you go. Hong Kong remains as safe a city to visit, as open a society, and as vibrant an economy as before. The 'one country, two systems' concept works, right in front of your eyes. And I have every confidence that Hong Kong will grow from strength to strength as it plays an even more important role as China's window on the world and the world's window on China.

Insurance is gaining importance in all the economies in the Pacific Rim. In Hong Kong, the contribution of the insurance industry to economic growth is becoming increasingly significant. It has recorded double-digit growth for nearly a decade. At present, the industry accounts for about four per cent of our Gross Domestic Product. The industry provides employment for nearly 50,000 people.

However, the density and penetration of insurance in Hong Kong, especially life insurance, are still relatively low as compared with Japan, North America and Western Europe. The growth potential of the Hong Kong insurance market is great. The imminent introduction of the Mandatory Provident Fund schemes, of which we expect the life insurance companies to be major providers, will further strengthen the development of the insurance industry in Hong Kong.

Life insurance business is a people-oriented business. Insurance practitioners play a significant role in the development of the market. As the people of Hong Kong become more affluent, they are more interested in life insurance policies with special features such as those with elements of saving or investment. In order to meet the rising expectations of both existing and potential policyholders, insurance practitioners have to be professionally competent and trustworthy. They have to constantly update themselves on the latest market trends, consumer preferences and product innovations. Conferences and seminars will serve this purpose well. Through a series of well organized speeches by prominent professionals and discussion sessions, I am sure that this Congress will provide you with an excellent opportunity to share ideas and experience with your successful colleagues. It will help you establish professional links and friendship among yourselves.

With regard to the prudential regulation of the insurance industry in Hong Kong, I can summarise our guiding principle in four words, that is, "minimum intervention, maximum support". We subscribe to the philosophy of free markets. We believe that market competition is the best guarantee for economic efficiency and consumer welfare. Commercial decisions in matters such as determination of premium rates, commissions, policy terms and business conduct should best be left to market forces and self-regulation of the industry. We will continue to do what is necessary to promote the stability and financial soundness of the insurance industry, and to facilitate the further development of the insurance market in Hong Kong. Our latest initiatives in regard to the latter objective include the promotion of the reinsurance sector and the introduction of captive insurance in Hong Kong. We aim to make Hong Kong a regional insurance centre that meets the insurance needs of the modern world of tomorrow.

Before closing my speech, I would like to welcome you once again to Hong Kong and wish you a stimulating and successful Congress.

Thank you.