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Budget Speech by the Financial Secretary (5)

Developing the Economy

43. Mr President, we are now in the early stage of recovery and our economic prospects are unclear.  I will continue to help our citizens ride out the economic difficulties.  At the same time, I will improve their quality of life through enhancing social mobility and essential services.  My objectives are to consolidate the recovery, develop our economy and build a caring society.

44. First, I will give a brief account of the strategies and measures in relation to our economic development.  In support of the development blueprint set out in the Policy Address, I will promote sustainable development of our economy by furthering regional co-operation, investing in infrastructure and promoting the development of various industries.

Furthering Regional Co-operation

45. In my last Budget I pointed out that the Government would play the role as a "champion" in furthering economic integration.  We will continue to make the best of Hong Kong's modernisation and internationalisation, and capitalise on the "China advantage".

46. Specifically, we can support the development strategy of the Mainland by further developing Hong Kong into a knowledge-based and high value-added economy.  At the international level, the Mainland has been actively promoting quality growth and encouraging enterprises to reach out to the international market.  Hong Kong can provide a platform for the Mainland's enterprises to expand overseas.  We can also make use of our strengths to help these enterprises bring their management and technological standards closer to the international level.  With our rich experience in international exchanges, we can assist the Mainland in building brand names and improving product image.  Our service industries will emerge out of the process with broader scope and better standards.  Our position as an international financial and commercial centre will also be reinforced.

47. At the national level, the Mainland economy is becoming more and more market-oriented, industrialised and urbanised.  This plays a crucial role in China's sustainable development and creates excellent opportunities for Hong Kong.  Hong Kong can assist by attracting foreign investment, facilitating international exchanges and providing quality services that are essential to the restructuring and upgrading of Mainland's economy.  This will help promote quality growth of the Mainland's economy.  It will also increase the demand for Hong Kong services, thereby addressing the problem of our small local market.

48. At the regional level, Guangdong is one of the best developed regions in China.  It is also the vanguard of our country's reform and liberalisation, and its systems can most readily be aligned with international standards.  Hong Kong and Guangdong enjoy geographical proximity, close cultural ties and a long history of co-operation, and yet differ greatly in such areas as resources and industrial structure.  As such, there is ample room for the two places to increase co-operation.  Hong Kong can speed up its integration with the Pearl River Delta (PRD) to increase the depth and breadth of the market in the region, creating synergy for the joint development of the two places.

12th Five-Year Plan

49. We will take full advantage of the platform being provided under the National 12th Five-Year Plan.  Our state leaders have indicated that in preparing the Plan, the Mainland authorities will keep the SAR Government informed of the planning progress and seek our views, so that we can have a full picture of China's situation and directions for development.  We will capitalise on this opportunity.  We will strengthen our liaison with the relevant Mainland departments and ministries as well as our direct working relationship with the National Development and Reform Commission, with a view to complementing in all respects the preparation of the National 12th Five-Year Plan under the principle of "One Country, Two Systems".

Co-operation between Guangdong, Hong Kong and Macao

50. At the regional level, we are implementing the Outline of the Plan for the Reform and Development of the Pearl River Delta (the Outline) by drawing up a framework agreement for Hong Kong-Guangdong co-operation.  This framework will translate the Outline's macro policies into concrete measures conducive to the development of both places, with a view to incorporating the related policies into the National 12th Five-Year Plan.  At the same time, we are actively working with Guangdong and Macao to formulate specific regional co-operation plans on building a quality living circle and on infrastructure development.

51. We are also in close liaison with the Guangdong Provincial Government and the Shenzhen Municipal Government to explore ways of promoting the development of service industries in Qianhai.  This will allow us to tap the Greater PRD market, which has a population of 50 million, and in turn the Pan-PRD market, which has a population of more than 400 million.  At the Plenary meeting of the Hong Kong/Guangdong Co-operation Joint Conference last August, a letter of intent on co-operation was signed to set up an expert group to explore how best to leverage Hong Kong's advantages as an international financial, trade and shipping centre, and to combine the strengths of the two places to promote the development of modern service industries in Qianhai.  The present consensus is that the Shenzhen Municipal Government will assume the leading role in developing and managing Qianhai, and the SAR Government will render advice on planning and policy formulation.

Exchanges and Co-operation with Taiwan

52. To enhance the co-operation between Hong Kong and Taiwan, the SAR Government has decided to set up the Hong Kong-Taiwan Economic and Cultural Co-operation and Promotion Council (ECCPC).  The ECCPC will discuss matters of mutual interest and enhance co-operation in various respects with its counterpart in Taiwan, the Taiwan-Hong Kong Economic and Cultural Co-operation Council (ECCC).

53. At the corporate level, the Hong Kong-Taiwan Business Co-operation Committee (BCC) comprising members of the local commercial sector and Taiwan businessmen in Hong Kong will be set up.  The BCC will discuss with the Economic Co-operation Committee under the ECCC ways to foster co-operation between Hong Kong and Taiwan in trade and investment.

54. Hong Kong and Taiwan have been liaising closely on the establishment of the new co-operation platform to kick-start collaborations on various fronts, fostering mutually beneficial co-operation between the two places.  Once the new platform is established, I hope to lead a delegation of ECCPC and BCC members to Taiwan to discuss issues on bilateral co-operation.

(To be continued)

Ends/Wednesday, February 24, 2010
Issued at HKT 11:37


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