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Tung: HK's Economy Ready for Next Paradigm Shift
Tung Chee Hwa, chief executive of the Hong Kong Special Administrative Region, said Wednesday, December 13, that Hong Kong's economy was now ready for the next paradigm shift.
By turning adversity into opportunity in overcoming the Asian financial turmoil, Tung noted that Hong Kong had reduced the cost of doing business here, undertook fundamental reforms to its financial system, merged the stock and futures exchanges, launched the Growth Enterprise Market, and started work on the Cyberport, Science Park and other infrastructural facilities.
It had also liberalized its telecommunications and broadcasting sectors, and upgraded tourism through new initiatives, he added.
The chief executive pointed out that Hong Kong's strengths stemmed from its position as a specialized service economy, the clustering of headquarters and headquarter-related services, its international capital markets capability, its role as a transportation hub, and its expertise in global trading and logistics.
"The huge hinterland economy, particularly that of the Pearl River Delta, is the dynamo which will drive the expansion. The Mainland's growing involvement with the global markets can only be excellent news for Hong Kong and the region," he said.
Tung said that with much larger foreign direct investment into China in the years to come, Hong Kong's capital markets would continue to transform, and grow at a hectic pace, from a hub for loan syndication to become an equity-raising hub for local, mainland, and foreign companies.
Noting that the number of regional headquarters and offices in Hong Kong had increased from 2,500 in 1999 to about 3,000 this year, Tung said that he saw Hong Kong's role as a headquarters hub broadening to address the needs of thousands of smaller and less internationally experienced companies seeking a headquarters location or strategic partner in Hong Kong to explore the unfolding opportunities in the Mainland.
Tung said that following the entry of China into the WTO, the formation of the regional economy between Hong Kong and the Pearl River Delta would gather momentum.
"The strengths of Hong Kong as a business center and the strengths of the Pearl River Delta as a manufacturing base are complementary. I see a lot of room for collaboration between the two places in IT and high-tech development," he said.
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