*********************************************************

Following is the transcript (English part) of the Financial Secretary, Mr Donald Tsang's comments on US interest rate reduction at the West Wing Lobby of Central Government Offices today (January 4):

Financial Secretary: I believe the reduction in interest rate in the United States is a good development. We have seen a very marked slowing down in the US economy over the last month. This reduction in interest rate will surely help preventing a hard landing in the US economy. It would then also help various markets in Asia from going slow very quickly as a result of the US market. As far as Hong Kong is concerned, because we are linked to the US dollar it will certainly impact on the interest rate which will become correspondingly lower. It will help the people who are servicing mortgages, it will help businesses in borrowing money from the banks, and it might give some incentive to the investment in the securities market. So, on the whole I think it is a good development. Certainly I hope Mr Greenspan together with the Treasury Secretary in US should help us to prevent a hard landing in the US economy and this is a very useful first step.

Financial Secretary's transcript on interest rate reduction (Chinese part)

End/Thursday, January 4, 2001

NNNN