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Speech by FS at Columbia University in New York (English only)

     Following is the speech by the Financial Secretary, Mr John C Tsang, at the School of International and Public Affairs, Columbia University in New York today (October 11, Eastern Standard Time):

Professor (Arvid) Lukauskas, Professor Dong, ladies and gentlemen,

     Good afternoon.

     It is my great pleasure to be here today. My thanks to the School of International and Public Affairs for organising this forum.

     Columbia University, one of the world's great academic institutions, has ties to more than 100 Nobel Prize laureates, several US presidents, including the current title holder, more than 20 Academy Award winners and nine justices of the US Supreme Court.

     I discovered that, and much more, in Columbia's online profile. It noted, for example, that Columbia is among the few universities that embrace the "Primal Scream". This annual practice, as I understand, takes place at midnight on the Sunday before the last week of final exams. Columbia students, and probably a few professors, according to tradition, open their windows and howl.

     Apparently, the howling continues for up to five minutes. I am not sure whether it is just a straightforward stress alleviation exercise or perhaps a seasonal campus mating call. But what I really want to know is why it is limited to five minutes, and only once a year.

     I am no stranger to the Big Apple. Back in the '60s, I lived on the Lower East side. I went to a local Junior High School and then Stuyvesant High School when it was still located on 15th Street. I was so anxious to get away from home that I did not consider any of the "local" universities, like Columbia. Instead, off I went to Cambridge, Massachusetts, where I studied architecture and Public Administration, and then settled down to raise a family.

     After nearly 20 years here in the US, I returned to Hong Kong in the '80s and joined the civil service. Next month will mark 32 years since my return. And I have had a pretty interesting time during this period. The jobs I have held include Private Secretary to the last Governor of Hong Kong, Chris Patten. I was also Hong Kong's representative in London right after reunification in 1997, and the Commissioner of Customs & Excise, which comes with really smart-looking uniforms. I worked as the Secretary for Commerce and chaired the WTO Ministerial Meeting in 2005. I became the Financial Secretary in 2007, and I have been tackling the consequences of a series of global financial crises ever since.

     I have just told you a little about what Hong Kong has given me. Allow me to say a few words now about what Hong Kong can offer you: whether you are a graduate of the School of International and Public Affairs or other schools or departments here.

Abundant opportunities

     Hong Kong has a long history of being a major business and financial hub in Asia. Like New York, Hong Kong is the kind of place where anything is possible. The career opportunities are plentiful. They are there for your taking, and making.

     US companies in Hong Kong number about 1 400, with a strong focus on trading, transport, banking and finance. Apple, Federal Express, Exxon, IBM, Gap, J. Crew, Citibank and Bank of America are just a few of the well-known US brands doing business in Hong Kong.

     We also have a thriving start-up culture. Young American entrepreneurs are very much part of this exciting scene, engaging in areas ranging from education and technology to food, wine and fitness and much more. Let me add that tens of thousands of US nationals call Hong Kong home. But now that they are away from the US, they need to watch out for FATCA and "inversion".

     Now if you are concerned only about the challenges of ordering a pizza in Hong Kong, you should know that English and Chinese are both Hong Kong's official languages. While I can't promise that you'll get the extra cheese you ordered, you can be sure that the Italian chef will have some command of English, the language of international business in our town. And I think I can safely say that our taxi drivers are probably more conversant in English than most of the taxi drivers here in New York.

     Hong Kong is the world's eighth-largest trading economy. It is all about global business, and we have unique advantages in the region. Thanks to our unparalleled location, our longstanding business connections, our professional knowledge and our deep cultural ties, Hong Kong serves as the bridge between China and the world. We are also the gateway to the biggest market in the world.

     Perhaps less well-known is that we are also a major player in the ASEAN region, home to more than 600 million people, with a rapidly growing middle class. Business people in Hong Kong are well-connected to the ASEAN regions, and you will find ready partners, knowledgeable professionals and valuable advisers in Hong Kong.

     In fact, half the world's population is within a five-hour flight of Hong Kong. And we have hourly flights to a dozen major Asian cities. It should not surprise you that some 7 500 overseas and Mainland Chinese companies have a presence in Hong Kong. More than half of them are regional headquarters or regional offices.

     We embrace a nationality-neutral policy. Everyone is treated equally. Foreign nationals and companies enjoy the same rights as their local counterparts. They play by the same rules and exploit the same opportunities in Hong Kong. They enjoy equal access to markets that we have been able to open, thanks to trade agreements that we've signed with other economies. They can also make good use of CEPA, Hong Kong's unique trade agreement with Mainland China. In short, this is a real level playing field, unlike other so-called free markets.

     Perhaps most important, in Hong Kong you get to keep most of your hard-earned income. Our tax regime is low and uncomplicated. The top salaries tax rate is 15 per cent; profits tax is fixed at a flat 16.5 per cent. There's no capital gains tax, no inheritance tax, and no sales tax of any kind in Hong Kong. I even eliminated the tax on wine and beer six years ago.

     So everyone working in Hong Kong has a larger take-home pay compared with colleagues working in other major cities. Hong Kong has been accused, wrongly, of course, of being a tax haven. But the accusers, mainly European governments with deficit and debt problems, have never been able to explain why I have been able to return budget surpluses since I became Financial Secretary. The secret is actually quite simple: small government.

Diverse lifestyle

     Enjoying life is something we do well in Hong Kong. We are a cosmopolitan city, with everything that goes with it. There is always something happening somewhere.

     Food, of course, is an indispensable part of Hong Kong city life. We have over 16 000 restaurants in Hong Kong. Yes, more than one restaurant for every 500 population! And they serve cuisine from all over the world providing unlimited varieties of food that cater to the different tastes of our diners. We are among the top-ten cities with the most Michelin stars, and also home to the least expensive one-star restaurants in the world.

     If you prefer nature and the outdoors, we have more than 260 outlying islands that are full of parks, hills and hiking trails. You can withdraw from the vibrant downtown and from your hectic worklife, and enjoy a tranquil hike on the countryside in 30 minutes. Indeed, country parks and nature reserves add up to some 40 per cent of our total area. So, yes, you can "just do it" all in Hong Kong.

     Culture is also a central part of Hong Kong life. And by that, I mean more than our eternal love affair with horse racing íV and betting. Certainly, our cultural interests and offerings reflect our roots íV a city where East meets West. Cantonese opera was the first Hong Kong treasure to be noted in UNESCO's "representative list of intangible cultural heritage", but it doesn't end there.

     We boast more than 1 000 arts groups, including nine flagship performing arts companies from the philharmonic and ballet, to Chinese orchestra and theatre companies. And galleries devoted to international and Chinese art are as rife as Starbucks on the streets of Hong Kong. Indeed, Hong Kong is among the world's largest art auction markets. Wine, too, though that's another story.

     And our West Kowloon Cultural District - 40 hectares spread out along prime waterfront land - will rise as one of the world's major arts and cultural districts over the next decade. In fact, the Cultural District's first major performing arts venue opens in two years' time. I hope to see you there for the opening. Another dozen venues, including theatres, museums and concert halls will follow.

Liberal environment

     Hong Kong is probably the most liberal city in Asia. We are devoted practitioners of free-market principles. For the past 20 years, the Washington based Heritage Foundation and Canada's Fraser Institute have rated Hong Kong the world's freest economy. Individual freedoms and rights are protected by the Basic Law, our constitutional document, and embraced by the entire community. Property rights, including your ideas and intellectual property, are jealously protected. We take pride in our independent judiciary, grounded in the rule of law.

     Freedom also means information that freely flows in and out of Hong Kong. We are a regional media centre, with the likes of Time-Warner, CNN, Bloomberg, the International New York Times and the Wall Street Journal all having regional operations in Hong Kong. Individual rights and the rule of law are safeguarded by some 30 local news agencies, including daily newspapers and electronic media. That is perhaps the highest number per capita anywhere in the world.

     All that freedom, of course, means that we can express our beliefs and opinions openly. We have certainly been doing that over the past couple of weeks in Hong Kong, and I am sure you are very well aware of the situation. It is unfortunate that these confrontations have occurred. Some people were injured, but no one has suffered serious harm to date. And there have been no broken windows, no scratches on vehicles, no looting. Quite a miracle for protests of this scale, but that is quite typical of such actions in Hong Kong. And that display the civility and decency of Hong Kong. The police, as well as the protesters, have been highly restrained. And long, I hope, this will last.

     I am saying this not to downplay the seriousness of the confrontations, which have been rather serious by Hong Kong standard. We have not seen this level of confrontation in Hong Kong for half a century. I am saying this because they show that we respect individuals' rights to express their opinions and voice their views. And that the vast majority of protestors understand that the police officers are just doing their job. After all, both the police officers and the protestors are all Hong Kong people who share common core values of Hong Kong.

     Admittedly, there have been extensive traffic delays in some areas, and a great deal of inconvenience for the workers and businesses in the affected districts. But everyone concerned carried on with their work, and business continued as usual. The financial markets operated normally.

     This protest is about the election of the Chief Executive in 2017. The issue is how candidates should be nominated for election by the five million Hong Kong people who will be able to vote, most for the first time. The government fully understands the protestors' wishes. There is, however, a sizeable segment of the community holding different views. The community is divided. The government will do our best to bridge our divided community, to build consensus within the confines of our constitution.

     We do not underestimate the difficulty of this task. But it is up to us, the Hong Kong people, to come together to take a giant step forward towards universal suffrage in the 2017 election of the next Chief Executive of Hong Kong. Protests and confrontations may well continue to be part of the consensus-building process. But I am confident that we will find a way forward, and that we will do so with the civility and decency that have long been the hallmarks of Hong Kong.


     Ladies and gentlemen, Hong Kong is a leading international business hub. We offer plenty of career opportunities for ambitious young people as well as those who are looking for the experience of a lifetime, comprising a good mix of industries, complemented by diverse lifestyle. We enjoy a truly liberal environment where everyone is free to think, talk and act, limited only by law and mutual respect.

     I wish you all the best with your studies here at Columbia University. And if the future is on your mind, my advice is simple: make sure you include Asia. Especially Hong Kong. Thank you.

Ends/Sunday, October 12, 2014
Issued at HKT 07:31


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