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The Better Hong Kong Foundation Luncheon with Media Organisation Executives

2024.02.21
On 21 February 2024, the Foundation held a luncheon to celebrate the Lunar New Year with a group of local senior media friends, aiming to strengthen mutual understanding and communication. Chaired by the Foundation’s Executive Committee Chairman Mr. Ronnie Chan, members of the Foundation’s Working Group including Council Members Mr. Dario Pong (Co-Convener of the Working Group), Dr. Roy Chung, Mr. Y K Chan, Mr. John Lee, Ms. Catherine Leung, Dr. Zhong Xiaofeng, Mr. Nathan Lee, Mr. Eugene Cheung, Ms. Clara Chan, and Mr. Bosco Law as well as Executive Director Ms. Karen attended the luncheon, where they exchanged and shared views with media friends on the future development of mainland China and Hong Kong, global situations, and geopolitical challenges. The media organization executives joining the luncheon included the Editor-in-Chief of SCMP Ms. Tammy Tam; Editor-in-Chief of Ming Pao Mr. Dominic Lau; Editor-in-Chief of Hong Kong Economic Journal Ms. Alice Kwok; Editor-in-Chief of Sing Tao Daily cum the Standard Mr. Ivan Tong; Deputy Editor-in-Chief of Wen Wei Po Mr. Luo Zheng; Deputy Editor-in-Chief of Hong Kong Economic Times Ms. Wong Wai-yat; Director of News and Infotainment of i-CABLE Ms. Regina Kwan; Senior Current Affairs Manager of News & Information Services Division of TVB Ms. Yuan Siu-ching; Assistant Vice President of News and Business Information of NowTV Mr. Vincent Lam; Head of Chinese News and Current Affairs of RTHK Ms. Phoenix Wong; Deputy Director of News & Public Affairs of Hong Kong Commercial Radio Ms. Crystal Cheung; Publisher of Bastille Post Mr. Lo Wing-hung; and Chief Managing Editor of HK01 Mr. Kelvin Chan. (Front row, L to R) Ms. Alice Kwok, Mr. Dario Pong, Ms. Tammy Tam, Mr. Ronnie Chan, Mr. Lo Wing-hung, Ms. Karen Tang, Mr. Dominic Lau and Dr. Roy Chung; (Back row, L to R) Mr. Kelvin Chan, Mr. Eugene Cheung, Ms. Clara Chan, Mr. Bosco Law, Ms. Regina Kwan, Ms. Wong Wai-yat, Mr. Vincent Lam, Ms. Crystal Cheung, Mr. Ivan Tong, Mr. Nathan Lee, Ms. Phoenix Wong and Mr. Luo Zheng

BHKF and CAPS Release Report “Hong Kong as a Philanthropy Hub”- 85% of UHNW Individuals and Families in Mainland China and Hong Kong are Engaged in Philanthropy

2023.02.23
Hong Kong, 23 February 2023 – The Better Hong Kong Foundation (BHKF) today released a research report entitled “Hong Kong as a Philanthropy Hub”, in collaboration with the Centre for Asian Philanthropy and Society (CAPS), emphasizing the strengths and potential of the city to be a philanthropy hub. Highlighting how Hong Kong can enhance its attractiveness, for both individual and corporate private wealth owners, the report discusses how the city can develop its role as Asia’s pre-eminent philanthropy hub. Hong Kong can Strengthen its Role as Asia’s Philanthropy Hub Hong Kong has long had a tradition of strong philanthropic principles. Chinese values, coupled with a market focus, have spurred a profound philanthropic history in the city, evidenced by significant altruistic gifts and the presence of The Hong Kong Jockey Club Charities Trust, one of the biggest charity donors in the world. In addition, since 2007, the number of registered charities in the city has increased by three-fold to a total of over 15,000. Hong Kong is a leading wealth management hub in Asia with a deep pool of talent. In 2021, net fund inflows amounted to HKD638 billion, while the total number of staff engaged in private banking and private wealth management increased, of which one third were Private Wealth Management Practitioners according to SFC data (1). Hong Kong is also the world’s foremost city for its ultra-high-net-worth (UHNW) population, with estimates suggesting over 15,000 residing in the city in 2022 (2), cementing Hong Kong’s status as an international hub of donors. Furthermore, Hong Kong is the globe’s natural gateway to Mainland China, a country host to the largest number of billionaires in the world (3), as well as the fastest-growing number of foundations. According to a CAPS survey, 85% of UHNW individuals and families in Mainland China and Hong Kong are engaged in philanthropy, with 97% eager to learn more about topics such as social investment and philanthropic donation. Encouragingly, over 60% of respondents reported that philanthropy has a positive impact on strengthening their family bonds and it has a strong impact on boosting one’s sense of purpose. Mr. Ronnie C. Chan, the Executive Committee Chairman of the Better Hong Kong Foundation, said, “While Hong Kong is renowned as a leading international financial center, relatively little has been said about its role as a philanthropy hub. We are therefore delighted to present this study to help support a better Hong Kong. Our research recognizes the strengths of the city as a philanthropy hub for Asia. We are encouraged to witness the Hong Kong Government promoting the attractiveness of the city for private wealth owners and corporate philanthropy, such as the establishment of an advisory task force and the inclusion of philanthropy during the Asia Financial Forum. We hope our research will inspire more discussions and collective actions, helping ensure Hong Kong to be the philanthropy hub for Asia.” The report analyzes the strengths and potential that each stakeholder group including donors, policymakers, private wealth practitioners and academia bring to the philanthropy ecosystem in Hong Kong. It also points out that the Hong Kong Government can and should take an active role in creating regulations and tax incentives which will aid in the establishment of philanthropic foundations, initiatives and collaborations. When all stakeholders work in partnership, Hong Kong can reinforce its status as the pre-eminent philanthropy hub for Asia. Commenting on the research, Mr. Christopher Hui, GBS, JP, Secretary for Financial Services and the Treasury, said, “We welcome the report and the suggestions. Hong Kong not only has long history of philanthropy, but also the unique advantages to become Asia’s philanthropy center for global family offices to deploy wealth for good causes. In the past years, we have been ramping up joint-departmental efforts to optimize the philanthropic ecosystem in Hong Kong, by offering a full range of investment choices and financing solutions for alternative assets. The Hong Kong SAR government is committed to maximizing the role of each stakeholder group toward the enhancement of our philanthropy hub.” (1) https://www.sfc.hk/-/media/EN/files/COM/Reports-and-surveys/AWMAS-2021_final_e.pdf (2) https://altrata.com/reports/world-ultra-wealth-report-2022 (3) https://www.hurun.net/en-US/Info/Detail?num=EAR425P9JVTE ### About The Better Hong Kong Foundation (BHKF) The Better Hong Kong Foundation is a politically non-affiliated, privately-funded, non-profit making organization. It was established in 1995 by a group of influential local business and community leaders in Hong Kong who were committed to the territory and wanted to share their confidence in its future with the corporate and political leadership overseas. The Foundation is a realization of this vision, actively liaising with counterparts in the international community and updating them on Hong Kong’s dynamic activities in trade, finance, business and communications. For more information on the BHKF, please visit: www.betterhongkong.org. About the Centre for Asian Philanthropy and Society (CAPS) Established in 2013, the Centre for Asian Philanthropy and Society (CAPS) is an action-oriented research and advisory organization committed to maximizing private resources going toward doing good in Asia. CAPS accomplishes its mission by understanding fundamental strengths and cultural practices in Asia as well as researching and promoting public policies that best enable the giving and receiving of private social investment. More information on CAPS research and services is available at: http://caps.org/. The full report can be downloaded at https://caps.org/work/our-research_hong-kong-as-a-philanthropy-hub. For research result related questions, please contact CAPS. For media enquiries, please contact: The Better Hong Kong Foundation Ms. Jimmie Chow 852 2865 3529 jimmie_chow@betterhongkong.org Centre for Asian Philanthropy and Society Ms. Willa Wong 852 3611 0250 willa@caps.org

Press Conference of 2018 China Urban Competitiveness Report (Hong Kong)

2018.06.29
Organizer The Better Hong Kong Foundation Co-organizers Center for City and Competitiveness, The Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong Abstract 2018 China Urban Competitiveness Report   Comprehensive Economic Competitiveness Index 2017 Sustainable Competitiveness Index 2017 Livability Competitiveness Index 2017 1 Shenzhen Hong Kong Hong Kong 2 Hong Kong Wuxi Beijing 3 Shanghai Hangzhou Shanghai 4 Taipei Guangzhou Shenzhen 5 Guangzhou Nantong Guangzhou 6 Beijing Nanjing Hangzhou 7 Tianjin Macao Nanjing 8 Suzhou Zhenjiang Wuhan 9 Nanjing Ningbo Macao 10 Wuhan Shenzhen Chengdu Suggestions: – Build Hong Kong a new-type global metropolitan – Create the core function of “innovation + technology” – Maximize the advantage of “One-country, Two-system” and share the huge dividend in country’s development – Undertake the roles of strategic node and core hub in the Belt & Road Initiative – Strive for the role of dragonhead of the Guangzhou-Hong Kong-Macao Bay Area (29 June 2018, Hong Kong) The Press Conference of 2018 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 29 June 2018. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. Ms. Karen Tang from The Better Hong Kong Foundation, Prof. Pengfei Ni from The Chinese Academy of Social Sciences and Prof. Jianfa Shen from The Chinese University of Hong Kong speak in the press conference on the new research results of the urban competitiveness of Chinese cities especially the urban competitiveness of Hong Kong. “The 2018 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni. The theme of the 2018 Report is “40 years: Sparks of cities have spread to everywhere”, revealing the important function of cities in China’s opening and reforms, and analyzing the mechanism of successful development of Chinese cities in the past four decades. The 2017 China urban competitiveness report continues to apply the existing theoretical framework. In this report, 294 cities are ranked by the Comprehensive Economic Competitiveness Index, while 289 cities are ranked by the Livability Competitiveness Index and the Sustainable Competitiveness Index. According to the Comprehensive Economic Competitiveness Index in 2017, the top ten cities are Shenzhen, Hong Kong, Shanghai, Taipei, Guangzhou, Beijing, Tianjin, Suzhou, Nanjing and Wuhan. They are all located in Pearl River Delta (PRD), Yangtze River Delta (YRD), Bohai Rim, and Hong Kong, Macao and Taiwan area, except Wuhan in central China. This reflects the advantages of coastal area in development. The variation of ranking in the comprehensive growth sub-indices is significant among the top ten (Hong Kong is ranked 30th and Taipei 89th while others are among the top 10), while they have high ranking in the comprehensive efficiency sub-indices (all are among the top 20). According to the Livability Competitiveness Index in 2017, the top ten cities are Hong Kong, Wuxi, Hangzhou, Guangzhou, Nantong, Nanjing, Macao, Xiamen, Zhenjiang, Ningbo and Shenzhen. The top ten list is different from the 2016 one, but cities in PRD, YRD and Hong Kong and Macao area are still leading the country. The top ten have a varied performance among the seven sub-indices. Four Guangzhou-Hong Kong-Macao Bay Area (GBA) cities – Hong Kong, Guangzhou, Macao and Shenzhen outperform other cities in certain sub-indices and each of them is ranked top 10 in two to four sub-indices. The ranking of the remaining six YRD cities in the sub-indices are more balanced. According to the Sustainable Competitiveness Index in 2017, the top ten cities are Hong Kong, Beijing, Shanghai, Shenzhen, Guangzhou, Hangzhou, Nanjing, Wuhan, Macao and Chengdu. This ranking shows that coastal cities will still be the pioneers in economic transformation of China in the foreseeable future, but individual cities in the central and western regions are also catching up quickly. Among the six sub-indices, the top ten are ranked high in the sub-indices of knowledge-based city competitiveness, cultural city competitiveness, urban-rural integrated city competitiveness, and info-city competitiveness. The variations of ranking in the sub-indices of harmonious city competitiveness and eco-city competitiveness are significant. Hong Kong is ranked second in the Comprehensive Economic Competitiveness Index. The sub-index of overall efficiency competitiveness is 0.759, which is higher than the index in 2016 and ranked third after Macao and Taipei. The sub-index of overall incremental competitiveness is 0.268, which is lower than the index in 2016 and ranked 30th, down by 11 places from last year. Hong Kong tops the Livability Competitiveness Index. Hong Kong’s high ranking in the sub-indices of high quality education environment, good medical environment, green and ecological environment, and active economic environment contributes greatly to the top ranking of the city. Compared to last year’s index, the rankings of the sub-indices of education environment and ecological environment remain unchanged. The rankings of infrastructure and social environment sub-indices are improved significantly and slightly respectively. Medical environment, living environment and economic environment sub-indices have experienced slight drop. Hong Kong leads in Sustainable Competitiveness Index. Hong Kong is ranked first with the index of 1. Hong Kong’s economy maintains a good momentum of development in recent years. However, from a structural point of view, Hong Kong still faces major challenges in terms of technology innovation, industrial diversification and upgrading. The efforts of HKSAR Government in better supporting science and innovation – building a solid industrial foundation and policy environment – consolidate the leading role of Hong Kong in Sustainable Competitiveness Index. Although Hong Kong is still a leader in these competitiveness indices, the city must be prepared in the context of the new global economy and city-cluster development in mainland China. Hong Kong should carry out industrial restructuring and build itself a new-type global metropolitan in order to adapt to the new environment and lead the urban transformation in the world. The report makes suggestions on the future development of Hong Kong in three aspects. (1) In terms of industrial development, Hong Kong should pay long-term emphasis on innovation and technology. While continuing the existing market systems and practices, Hong Kong should promote innovation and technology as a new engine of development, and create the core function of “innovation + technology”. (2) In terms of institutional advancement, on the basis of maintaining “One-country, Two-systems” and “a high degree of autonomy”, Hong Kong should foster economic integration with mainland cities through institutional innovation, and maximize the advantage of “One-country, Two-system” and share the huge dividend in country’s development. (3) In terms of spatial development, Hong Kong should embrace the Belt & Road Initiative and undertake the roles of strategic node and core hub in the Belt & Road Initiative. At the same time, Hong Kong should participate in the construction of the Guangzhou-Hong Kong-Macao Bay Area. Hong Kong should encourage the further flows of factors of production and economic integration by making use of Hong Kong’s advantages, and strive for the role of dragonhead of the Guangzhou-Hong Kong-Macao Bay Area. Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “I am glad to find that Hong Kong keeps its high competitiveness for a long period of time. It is the result of concerted efforts by all sectors of the community and also the appropriate integration of economic, social and environmental development. In the context of global economic uncertainty, rapid development and transformation of the country and GBA that are posting both challenges and opportunities to Hong Kong, Hong Kong’s spirit of being positive and dare to change do matter in making responses. Hong Kong should make good use of its advantages and grasp opportunities arising from science & innovation, the Belt & Road Initiative and GBA, in order to achieve sustainable development and strengthen its urban competitiveness.” For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org. Website: www.betterhongkong.org. Please click here to download the PPT for the press conference (Chinese only).

Press Conference of 2017 China Urban Competitiveness Report (Hong Kong)

2017.06.26
Organizer The Better Hong Kong Foundation Co-organizers Center for City and Competitiveness, The Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong   Abstract 2017 China Urban Competitiveness Report   Comprehensive Economic Competitiveness Index 2016 Sustainable Competitiveness Index 2016 Livability Competitiveness Index 2016 1 Shenzhen Hong Kong Hong Kong 2 Hong Kong Wuxi Beijing 3 Shanghai Guangzhou Shanghai 4 Taipei Macao Shenzhen 5 Guangzhou Xiamen Guangzhou 6 Tianjin Hangzhou Hangzhou 7 Beijing Shenzhen Nanjing 8 Macao Nantong Macao 9 Suzhou Nanjing Qingdao 10 Wuhan Shanghai Dalian Suggestions: –  Build Hong Kong a new-type global city –  Treasure the value of innovation and technology –  Build Hong Kong an inclusive, fair, diversified and coordinated society –  Attract more worldwide talents –  Embrace the Belt & Road Initiative –  Participate in the construction of the Guangzhou-Hong Kong-Macao Bay Area (26 June 2017, Hong Kong) The Press Conference of 2017 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 26 June 2017. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. Ms. Karen Tang from The Better Hong Kong Foundation, Prof. Pengfei Ni from The Chinese Academy of Social Sciences and Prof. Jianfa Shen from The Chinese University of Hong Kong speak in the press conference on the new research results of the urban competitiveness of Chinese cities especially the urban competitiveness of Hong Kong. “The 2017 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni. The theme of the 2017 Report is “Housing Price System: The Leverage and Trap of China in Transformation”, identifying the new property price system and revealing the new urban cluster pattern in the process of economic structural transformation in China. The 2016 China urban competitiveness report continues the previous theoretical framework, with the simplification of index system. In this report, 294 cities are ranked by the Comprehensive Economic Competitiveness Index, while 289 cities are ranked by the Livability Competitiveness Index and the Sustainable Competitiveness Index. According to the Comprehensive Economic Competitiveness Index in 2016, the top ten cities are Shenzhen, Hong Kong, Shanghai, Taipei, Guangzhou, Tianjin, Beijing, Macao, Suzhou and Wuhan. They are all located in Pearl River Delta (PRD), Yangtze River Delta (YRD), Bohai Rim, and Hong Kong, Macao and Taiwan area, except Wuhan in central China. The variation of ranking in the comprehensive growth sub-indices is significant among the top ten, while they have high ranking in the comprehensive efficiency sub-indices. According to the Livability Competitiveness Index in 2016, the top ten cities are Hong Kong, Wuxi, Guangzhou, Macao, Xiamen, Hangzhou, Shenzhen, Nantong, Nanjing and Shanghai. Cities in PRD, YRD and Hong Kong and Macao area are leading the country. Among the seven sub-indices, the top ten perform well in the high quality education environment, active economic environment, and good medical environment indices. The variation of ranking in the green and ecological environment index is significant, and these cities have low ranking in the comfortable living environment and convenience of infrastructure indices. According to the Sustainable Competitiveness Index in 2016, the top ten cities are Hong Kong, Beijing, Shanghai, Shenzhen, Guangzhou, Hangzhou, Nanjing, Macao, Qingdao and Dalian. This ranking shows that coastal cities will still be the economic engines of China and the pioneers in economic transformation in the foreseeable future. Among the six sub-indices, the top ten are ranked high in the knowledge-based city competitiveness, cultural city competitiveness, urban-rural integrated city competitiveness, and info-city competitiveness sub-indices. The variations of ranking in the harmonious city competitiveness and eco-city competitiveness sub-indices are significant. Hong Kong is ranked second in the Comprehensive Economic Competitiveness Index. The sub-index of overall efficiency competitiveness is 0.647, ranked third after Macao and Taipei. High degree of agglomeration, streamlined business regulations, and good professional services are the contributing factors. The sub-index of overall incremental competitiveness is 0.342, ranked 19th, up by 17 places from last year. Although potential markets have been located for the traditional industries where Hong Kong enjoys clear advantages, Hong Kong needs to develop new sources of growth by promoting new industries driven by innovation and hi-tech, facilitating the diversification and upgrading of industrial activities, and strengthening the foreign trade relations. Hong Kong tops the Livability Competitiveness Index. Hong Kong’s high ranking in the sub-indices of high quality education environment, good medical environment, green and ecological environment, and active economic environment contributes greatly to the top ranking of the city, while the low ranking in the sub-indices of comfortable living environment and convenience of infrastructure is the defect. Hong Kong leads in Sustainable Competitiveness Index and needs to continue the progress of knowledge-based city development. Hong Kong is ranked first with the index of 1. Hong Kong is ranked first in the sub-index of info-city competitiveness, second in the sub-indices of eco-city competitiveness and urban-rural integrated city competitiveness, eighth in the cultural city competitiveness sub-index and 17th in the harmonious city competitiveness sub-index. Hong Kong is also ranked fourth in the knowledge-based city competitiveness sub-index, benefited from the rising trend of innovation and technology. However, the city must deal with the critical issues of knowledge transfer from the academia to the market products, midstream R&D, and the synergy of industry, academia and research sectors in this trend. Although Hong Kong is still a leader in these competitiveness indices, the city must be prepared in the context of the new global economy. Hong Kong should carry out economic restructuring and build itself a new-type global city in order to adapt to the new environment and grasp new opportunities. The report makes suggestions on the future development of Hong Kong in three aspects. (1) In terms of industrial development, we should treasure the value of innovation and technology. Hong Kong needs to maintain its traditional advantages and look for new source of economic growth, using innovative technology as the new engines of growth. “Finance + innovation” can be the core function of the economy. (2) In terms of social development, we should build Hong Kong an inclusive, fair, diversified and coordinated society and make community sharing and livelihood security as the foundation of economic development. Hong Kong also needs to attract more worldwide talents in order to raise its knowledge-based city competitiveness. (3) In terms of spatial development, Hong Kong should embrace the Belt & Road Initiative. Hong Kong’s uniqueness and spatial advantages allow the city to play as a key stakeholder in this grand strategy. At the same time, Hong Kong should participate in the construction of the Guangzhou-Hong Kong-Macao Bay Area, in order to foster the further flows of factors of production and economic integration, build an integrated economy and open market in the Bay Area, and provide more opportunities and markets for Hong Kong people and business sectors. This is a way of playing the role of “super-connector” well. Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “I am glad to find that Hong Kong keeps its high competitiveness and has improved in the areas of economic growth, innovation, ecology, and social service mechanisms. In the context of new global, regional and national environments that are posting both challenges and opportunities to Hong Kong, we need to further advance Hong Kong’s capacity in economic, social, environmental, and regional development. With opportunities arising from the “One Belt One Road” and the Grand Bay Area initiatives, I believe that Hong Kong could elevate to a new height with sustainable development and competitiveness.” For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org.  – End – Please click here to download the PPT for the press conference (Chinese only).

Press Conference of 2015 China Urban Competitiveness Report (Hong Kong) 

2015.05.18
Organizer The Better Hong Kong Foundation   Co-organizers Center for City and Competitiveness, The Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong   (18 May 2015, Hong Kong) The Press Conference of 2015 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 18 May 2015. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. Prof. Pengfei Ni from The Chinese Academy of Social Sciences and Prof. Jianfa Shen from The Chinese University of Hong Kong speak in the press conference on the new research results of the urban competitiveness of Chinese cities especially the urban competitiveness of Hong Kong. “The 2015 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni. The theme of the 2015 Report is “Giant hand: lift the new map of Chinese cities”, indicating that the integration among cities and regions under the new trend of socio-economic development is going to sustain the future of China. Facing both external and internal challenges, the Chinese economy has been experiencing a “new normal” since 2014, which obvious adjustments in the growth rate, the growth mode, and the driving forces are found. This also triggers transformation in Chinese cities’ comprehensive economic competitiveness and sustainable competitiveness, as well as their spatial pattern. Led by new technological revolution, the “Made-in-China 2025” strategy and “High-speed Railway Era”,  will be the two major wheels to drive China’s economic development and influence the general pattern of urban competitiveness of Chinese cities. To achieve sustainable urban development, grasping the chances of economic restructuring, focusing on innovation, industrial upgrade, infrastructure development, and increasing the ratio of urban workforce should be the priority of Chinese cities. The 2014 China urban competitiveness report continues the previous theoretical framework and policy implications, with new changes in the computational method and index analysis. The report distinguishes clearly three parts of urban competitiveness which are comprehensive economic competitiveness, livable and business-friendly competitiveness, and sustainable competitiveness. In this report, 294 cities are ranked by the Comprehensive Economic Competitiveness Index, while 289 cities are ranked by the Sustainable Competitiveness Indices. According to the Comprehensive Economic Competitiveness Index in 2014, the top ten cities in are Shenzhen, Hong Kong, Shanghai, Taipei, Guangzhou, Tianjin, Suzhou, Beijing, Macao, and Wuxi. They are all cities located in Pearl River Delta (PRD), Yangtze River Delta (YRD), Bohai Rim, and Hong Kong, Macao and Taiwan area. There is no city from central and western China. The most significant change is that Shenzhen surpassed Hong Kong and becomes the most competitive city. Wuxi replaced Foshan as well. Among the top ten, Tianjin is the most competitive in comprehensive growth index, while Macao is the strongest in comprehensive efficiency index. According to the Sustainable Competitiveness Index in 2014, the top ten cities are Hong Kong, Shanghai, Beijing, Macao, Shenzhen, Guangzhou, Hangzhou, Suzhou, Nanjing, and Xiamen. Similarly, most cities are from PRD, YRD and Bohai Rim, showing that these three city-regions will be the economic engines of China and the pioneers in economic transformation for a long time. Although Hong Kong was surpassed by Shenzhen in the comprehensive economic competitiveness, the city has a significant advantage in the sustainable competitiveness. On the other hand, although Hangzhou, Suzhou, Nanjing, and Xiamen are not the top ten contenders in the comprehensive economic competitiveness, they are strong and among the top ten in the sustainable competitiveness. To realize sustainable development, Chinese cities need to respond to the following problems and challenges. They must deal with the regional difference in urban competitiveness and inappropriate spatial and scale distribution of cities. They need to promote entrepreneurship and innovation for the development of knowledge-based and business friendly cities. They must reverse drawbacks due to the traditional urban development by massive urban construction and land revenue-based budget. They also need efficient and effective environmental management. To achieve sustainable urban development in the time of “new normal”, the report makes the following recommendations. First, to achieve sustainable competitiveness based on an objective understanding on the law of urbanization. Second, to realize a free flow and fair exchange of factors of production between urban and rural areas, and among regions. Third, the construction of high-speed transportation network is a good opportunity to optimize the spatial pattern of cities. Fourth, to nurture a supportive industrial structure based on innovation and low-carbon environment. Fifth, a long-term mechanism should be established for increasing sustainable competitiveness. Hong Kong is surpassed by Shenzhen in comprehensive economic competitiveness and is ranked second. The sub-index of overall efficiency competitiveness is 0.726, ranked third after Taipei and Macao. High degree of agglomeration, streamlined business regulations, and good professional services are the contributing factors. However, the sub-index of overall incremental competitiveness is only 0.278, ranked 32nd, fell by 14 places from last year. The condition of “managing the city without sufficient innovation” does not change. Hong Kong is still over-dependent on trade, financial sector, shipping, tourism, and professional services, while the attention to small-scale, emerging, and potential industries is not enough. There is no new industry to support and lead Hong Kong’s development in long term. Comprehensive Competitiveness Index and Ranking of Hong Kong in 2014 Year Comprehensive Economic Competitiveness Index Ranking Overall Incremental Competitiveness Index Ranking Overall Efficiency Competitiveness Index Ranking Sustainable Competitiveness Index Ranking 2013 1 1 0.363 18 0.733 3 1 1 2014 0.913 2 0.278 32 0.726 3 1 1 Source: The Chinese Academy of Social Sciences’ City and Competitiveness Database Hong Kong leads in sustainable competitiveness but the sub-index of knowledge-based city is weakening. Hong Kong is ranked first with the index of 1. Hong Kong is also ranked first in the sub-indices of harmonious city and urban-rural integrated city. Hong Kong tops the eco-city sub-index, benefiting from the achievement of a series of environmental protection and energy policies. The city is ranked second and third in cultural city and info-city sub-indices respectively. Nevertheless, the city is ranked 19th in knowledge-based city sub-index, fell by 14 places from last year. Although it is still in a leading position, and there are increases in R&D expenditure and number of R&D personnel, the Hong Kong government does not provide sufficient support to innovation and science & technology development. Hong Kong is also lack of bold plans and effective incentive system for technological innovation.   Sustainable Competitiveness of Hong Kong – Table of Sub-indices Sub-indices Knowledge- based City Harmonious City Eco-city Cultural City Urban-rural Integrated City Info-city Grade ★★★★★ ★★★★★ ★★★★★ ★★★★★ ★★★★★ ★★★★★ Index 0.554 1.000 1.000 0.977 1.000 0.978 Ranking in 2013 4 1 2 1 1 4 Ranking in 2014 19 1 1 2 1 3               Source: The Chinese Academy of Social Sciences’ City and Competitiveness Database Although Hong Kong’s comprehensive economic competitiveness and sustainable competitiveness are in the leading positions, the gap with mainland cities is narrowing. Facing challenges and opportunities ahead, Hong Kong should be prepared and grasp every opportunity in the process of cooperation with mainland China, in order to minimize the risk of marginalization. Hong Kong should play the role of  “super-connector” well to facilitate “going-out” and “bringing-in” and to create a win-win situation for Hong Kong and mainland China. The report makes recommendations on the future development of Hong Kong in three aspects. First, Hong Kong must emphasize the role of government, and build social cohesion and consensus in development. The government should maintain the governance approach of “moderate change with stability” and realize those promises in the policy manifesto. The government should also help local enterprises to build up their brands, upgrade, and develop the mainland China markets; and coordinate with the National 13thFive-year-plan to bring Hong Kong’s advantages into play. Second, Hong Kong must expand its cooperation and connection with mainland China, particularly an in-depth cooperation with Guangdong province and Shenzhen municipality. Hong Kong should seize the current opportunity to support the “One Belt, One Road” strategy, support the establishment and operation of Asian Infrastructure Investment Bank, facilitate the development of Guangdong Pilot Free Trade Zone, and foster the implementation of Shenzhen-Hong Kong Stock Connect. The more additional economic reform policies are implemented, the stronger the role of “super-connector” of Hong Kong will be. Third, Hong Kong must promote research and innovation and lead the development of a knowledge-based economy. Besides consolidating the development of four major industries, Hong Kong must continue to promote the six potential industries and bring them into full play in order to strengthen Hong Kong’s sustainable competitiveness. Hong Kong should continue the “going-out” and “bringing-in” policy. Like the China-Singapore Suzhou Industrial Park, Hong Kong can work with the Shenzhen counterparts and establish a Hi-tech Park in Shenzhen. By making good use of Hong Kong’s advantage in R&D and PRD’s strength in manufacturing, and bringing the forces of business, academic, and research sectors together, a win-win result can be achieved. Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “Though Hong Kong still tops other cities in the Sustainable Competitiveness Index, it is not easy for Hong Kong, as a mature economy, to maintain its leading position in the Comprehensive Economic Competitiveness index amidst the enormous growing power in the cities in the Mainland. It is a signal for Hong Kong to speed up, to innovate and to reinvent itself with some new driving engines. Hong Kong shall make use of its competitive edges especially its world class services in Finance to ride on and to facilitate China’s new grand plan of “One Belt, One Road”. In the past three years, we have been advocating the Government to map out its long-term development plan for innovation and technology and new emerging industries. However, the establishment of the Innovation and Technology Bureau is delayed. Good opportunities lay ahead of us but we have to seize them. They will not wait for us neither will our competitors”.   For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org.

2014 China Urban Competitiveness Report (Hong Kong)

2014.05.29
(29 May 2014, Hong Kong) The Press Conference of 2014 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 29 May 2014. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2014 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni in The Chinese Academy of Social Sciences. The theme of the 2014 Report is “YRD: the emerging global mega economic region”. For Hong Kong, the key suggestion is “promoting research and innovation, developing a knowledge-based economy”. Through strengthening the research and innovation and making it a new driving force for the development of Hong Kong, Hong Kong can alleviate the risks and challenges and release the potential of innovation to further enhance Hong Kong’s competitiveness.   The level of China’s urbanization reached 53.7% in 2013; urbanization has been designated as a long term strategy and an engine of economic growth by the new term of Chinese government; the National Plan for New-form of Urbanization (2014-2020) has just been promulgated recently. All these facts indicate that China has entered a new stage of urban development. Choosing correct direction and keys of development will have important and positive impact on the vision of urbanization and economic development. Comparing with other countries, China’s urbanization process still has many inadequacies. International experiences show that 50% is a critical point of urbanization. From this point onwards, the process of urbanization will be changed from quantitative expansion to qualitative change, and from the stage of extensive growth to intensive change. That means entering a latter stage of urbanization centering on “spatial resources allocation” as the main stimulating factor, different from the early urbanization driven by industrial development.   World Population Prospects: The 2010 Revision by the United Nations’ Department of Economic and Social Affairs indicates that the urbanization level of China will increase stably to 68.7% by 2030. In order to develop smoothly and to avoid middle-income trap throughout the phase with the level of urbanization increasing from 50% to 70%, Chinese cities must, temporally, ensure their sustainability; and spatially, continue to consolidate their positions at global and national levels and in the urban system. While the former issue is mainly a matter of sustainable development, the latter one is mainly a matter of urban competitiveness.   The Comprehensive Economic Competitiveness and Sustainable Competitiveness indices constructed in the 2013 China Urban Competitiveness Report offer a key reference for urban planning and choosing the direction of development of Chinese cities. The Project Team applies the same theoretical framework used in previous reports with improvement in the index system. 294 cities (including cities from Hong Kong, Macao and Taiwan) are ranked by the Comprehensive Economic Competitiveness Index, while 289 prefecture-level cities (including Hong Kong and Macao) are ranked by the livable city, business friendly city and Sustainable Competitiveness Indices. The top ten cities in the Comprehensive Economic Competitiveness Index in 2013 are Hong Kong, Shenzhen, Shanghai, Taipei, Guangzhou, Beijing, Suzhou, Tianjin, Foshan and Macao. They are all cities located in Eastern region and the influence of locational advantage to comprehensive economic competitiveness is obvious. In terms of administrative status of cities, Special Administrative Regions, municipalities, vice-provincial cities, cities with independent planning and provincial capitals have stronger competitiveness.   The top ten cities in the Sustainable Competitiveness Index in 2013 are Hong Kong, Shanghai, Shenzhen, Beijing, Macao, Guangzhou, Hangzhou, Xiamen, Qingdao and Nanjing. Similarly, coastal cities have the advantage. Livable city and business friendly city are two out of eight major sub-indices of the Sustainable Competitiveness Index. The top ten cities of the former in 2013 are Zhuhai, Hong Kong, Haikou, Sanya, Xiamen, Shenzhen, Zhoushan, Wuxi, Hangzhou and Shanghai. The top ten cities of the latter in 2013 are Hong Kong, Shanghai, Beijing, Shenzhen, Guangzhou, Wuhan, Chengdu, Tianjin, Nanjing and Chongqing. Raising the population quality and the improvement of municipal facilities and living environment, which are parts of the effort of livable city building, can raise the competitiveness of business friendly city. This is becoming more important for a society with rising income level.   A typical inverted U-shaped relationship is identified between the sustainable competitiveness and economic competitiveness. This indicates that the key to enhance the competitiveness of Chinese cities is not the present comprehensive economic competitiveness, but rather how to raise the sustainable competitiveness to enhance the development potential of the Chinese cities, which can be regarded as the inherent requirement and inexhaustible power to transform Chinese mode of socio-economic development.   To build livable city, business friendly city, knowledge-based city, harmonious city, eco-city, cultural city, urban-rural integrated city and info-city, a sustainable city in short, the Project Team recommends that Chinese cities must handle the following issues properly. They include solving the outstanding problems of fog and haze and high housing prices, the construction of long-term effective mechanisms for building an ideal business environment, the change from factor-driven to innovation-driven growth, the initiation of reforms, the getting out of the EKC[1] predicament, the avoidance of the loss of historical heritage and character, the solution of urban-rural dichotomy, and promoting IT development respectively.   Hong Kong keeps the top position in comprehensive economic competitiveness but the speed of growth is slowing down. The sub-index of overall efficiency competitiveness is 0.7329, ranked third after Taipei and Macao. Hong Kong has a significant advantage in GDP per unit of land, thanks to its dense population and commercial activities, a high degree of agglomeration, streamlined business regulations, a clean government, good supporting facilities and efficient services. However, the sub-index of overall incremental competitiveness is only 0.363, ranked eighteenth, fell by ten places from last year. Hong Kong is suffering from the gradual weakening of the advantages in talent, software and hardware facilities. There is no significant enhancement of the atmosphere of innovation and entrepreneurship. Land shortage-induced high rents hinder the development of small and medium-sized enterprises. Hong Kong is also over-dependent on financial and real estate sectors and lacks stable sectors for growth.   Hong Kong also has a top position in sustainable competitiveness but the sub-index of knowledge-based city and the sub-index of info-city are weakening. Hong Kong is ranked first with the index of 1.000. Hong Kong is also ranked second and first in the sub-indices of livable city and business friendly city respectively. Among six other sub-indices, Hong Kong has top positions in cultural city, urban-rural integrated city, harmonious city and eco-city, while it is ranked fourth in info-city. Its index in knowledge-based city is 0.749 and is ranked fourth after Beijing, Shanghai and Shenzhen. Hong Kong’s R&D expenditure, in terms of the percentage of GDP, is much lower than the one in Japan, South Korea, Singapore and the Mainland. Hong Kong also lacks effective incentive system for technological innovation, along with the weak atmosphere of innovation and ability of knowledge transfer. All these are the major problems in Hong Kong.   In addition to the insignificant transformation of the industrial structure towards innovation and technology, high dependence on the financial sector and real estate economically, rapid aging population and competition from global and the Mainland cities are the problems challenging Hong Kong’s sustainable development. The Project Team makes recommendations on the future development of Hong Kong in three aspects. First, the HKSAR Government should adjust its policy approach by developing long-term development planning on land policy, development of pillar and new industries, population policy and goals of sustainable development. Second, it has to re-position Hong Kong according to the latest situation of the Chinese economy and to play its unique role and influence. Specifically, Hong Kong can promote regional economic integration and the establishment of Guangdong-Hong Kong-Macao Free Trade Zone by deepening the implementation of CEPA and the Framework Agreement on Hong Kong/Guangdong Cooperation at the governmental level; can enhance the cooperation of its enterprises with their mainland counterparts to develop international markets; can further optimize the RMB clearing platform, promote the use of RMB and attract more enterprises to use RMB for settlement; can participate in the development of the Greater Pearl River Delta economic circle etc. These will let the people of Hong Kong better understand the importance of regional cooperation to regional prosperity and stability, strengthen civil and official exchanges and cooperation between two areas, and allow Hong Kong to play a unique role and impact. Third, to promote research and innovation, and to lead the development of the knowledge-based economy by consolidating the existing pillar industries, promoting the potential industries, implementing the “going-out” and “bringing-in” policies through the participation in the development of the “Shenzhen-Hong Kong Innovation Circle” and the construction of the Asian intellectual property rights trading and service center.   Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “Hong Kong ranks the 1st in both Comprehensive Economic Competitiveness and Sustainable Competitiveness. Hong Kong performs well in many aspects. To maintain our advantage in competitiveness and create a win-win situation, Hong Kong needs long-term plans for policies such as population and land use, should focus on nurturing research and innovation, and must play the role of ‘super connector’ well with its positioning in China in the context of ‘going-out, bringing-in’ policy.”   For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org.   – End – 2014 China Urban Competitiveness Report (Hong Kong)

The Better Hong Kong Foundation Concludes Its Annual Delegation Visit to the United States in June 2013

2013.06.26
(26 June 2013, Hong Kong) The Better Hong Kong Foundation (“the Foundation”) completed its annual delegation visit to the United States from 10 to 13 June 2013. A press conference was held today to brief members of the local media about the principal issues dealt with during their stay in the U.S. Members of the delegation also shared their observations and experiences gained from the trip. This year’s delegation was co-led by the Foundation’s Executive Committee Chairman Mr. Ronnie Chan, Chairman of Hang Lung Properties Ltd, and Council Member Dr. Roy Chung, Chairman of Federation of Hong Kong Industries and Co-founder & Non-Executive Director of Techtronic Industries Co Ltd. The Foundation’s Trustee Ms. Pansy Ho, Managing Director of Shun Tak Holdings Ltd also participated in our program in New York. Other delegates included Council Members Mr. Thomas Woo, Director of Hsin Kuang Restaurant (Holdings) Ltd; Ms. Winnie Ng, Director of the Kowloon Motor Bus Co Ltd; Mr. Joseph Yu, Chairman of Roseville Group of Companies; Ms. Diana Chou, Managing Director of Sino Private Aviation (HK) Ltd; Mr. Sebastian Man, Chairman & CEO of Chung Mei International Holdings Ltd; Ms. Juliana Lam, Managing Director of AML Group Holdings Ltd; Mr. John Lee, Managing Director of Bank of America Merrill Lynch and Mr. Anson Chan, Chairman & CEO, Bonds Group of Companies as well as Executive Director Ms. Karen Tang. The Foundation also invited Mr. Franklin Lam, Founder of HKGolden50 and Member of the Executive Council as the commentator on economic affairs of the delegation. After introducing the delegates to the media, Ms. Karen Tang explained the main purpose of the delegation was to foster a better understanding of the political, economic and social developments in both the United States and Hong Kong. The delegation visited the Executive Branch (U.S. Department of State and U.S. Department of Commerce); members of the Legislative Branch (Congressmen); think tanks (The Brookings Institution, The Heritage Foundation, National Committee on U.S.-China Relations and the U.S.-Asia Institute); a financial institution (Morgan Stanley); a rating agency (Fitch Ratings); NGOs (Hong Kong Association of New York and Clinton Global Initiative) and a university (George Washington University). The delegation also visited the Hong Kong Economic and Trade Office (HKETO) in Washington DC. During the visit in New York, the delegation participated in "Think Asia Think Hong Kong" conference organized by the Hong Kong Trade and Development Council as well as its Hong Kong Dinner. The delegation was also invited to join the reception hosted by the HKETO New York in honor of the Chief Executive C Y Leung in celebration of its 30th anniversary of establishing its office in New York. After visited Washington DC, seven delegates continued to participate in "Think Asia Think Hong Kong" conference in Los Angeles. They were also invited to the luncheon hosted by the HKETO San Francisco and the opening ceremony and launch reception for "Hong Kong Live" hosted by the Hong Kong Tourism Board respectively. The delegation was honored that the Embassy of the PRC in the U.S. (Ambassador Cui Tiankai) and the Consulate-General of the People’s Republic of China in New York (Ambassador Sun Guoxiang and Deputy Consul General Dong Xiaojun) hosted luncheons to welcome the delegation respectively. The delegation was also received by the Permanent Mission of the PRC to the UN (Ambassador Wang Min) in New York. Mr. Ronnie Chan expressed his gratitude to Ambassador Cui Tiankai, Consul General to New York Sun Guoxiang and Deputy Permanent Representative to UN Wang Min for their hospitality to the delegation. Mr. Chan was glad to see that China has been more proactive in reaching out to the local community, from inside the Beltway to Wall Street, which is important in building better understanding and trust between China and the U.S. At meeting with the rating agency, Mr. Chan expressed his worry of another possible global economic crisis as the fundamental problems after the financial crisis have been lingering without much advancement. Mr. Chan also said "Coincide with the Foundation’s visit to the U.S., I am honoured to chair the opening discussion session for the Trade Development Council’s conference in both New York and Los Angeles – Think Asia, Think Hong Kong, which was very successful. The Chief Executive officiated the conference in New York. It was very well attended and the participants were very receptive to the competitive advantages of Hong Kong."   Dr. Roy Chung was glad to learn that the think tanks generally were very positive in the Sino-US relations after the recent meeting between President Xi Jingpin and President Obama. They were optimistic in the reform and future developments in China, and conveyed that their policy towards Asia did not imply any containment to China. Dr. Chung also said "During our visit, one of the financial institutions has already warned that the economy is at the stage of post-crisis recovery cycle and that there will be tightening financial policy, hence the likely increase in interest rate. It is what we have been experiencing in the past one week." Dr. Chung continued that "Hong Kong was back to the radar screen of the U.S. and even on the front page of their newspapers as Mr. Edward Snowden was just revealed that he was in HK, on the first day that our delegation arrived." He said "It might help raise people’s interest towards Hong Kong as Hong Kong was highly regarded by Mr. Snowden as a place with freedom of expression and a place with an independent and reliable legal system." Ms. Karen Tang thanked the Hong Kong Economic and Trade Office for their hard work in soliciting the support of the U.S. authorities in granting visa waiver status to Hong Kong passport holders. "We visited 4 congress representatives and expressed our wish of having the visa waiver status and the benefit to their tourism and to facilitating inward investment and hence improvement in their employment", Ms. Tang said. "We also had meeting with Clinton’s Global Initiatives (CGI) who is exploring to bring back the CGI Asia to Hong Kong in 2014. We welcome and hope to facilitate more international conferences held in Hong Kong." On behalf of the Foundation, Ms. Tang thanked Mr. Franklin Lam for his presentation and analysis over Hong Kong’s competitive advantages, both with hard figures and a lot of soft factors at many meetings.    Mr. Franklin Lam shared his thoughts on this trip earlier that the meeting at the Heritage Foundation particularly resonated with him as he concurs with most of its belief in the principles of free enterprise, limited government and individual freedom. When they were updated of how our "small government" managed to achieve fiscal surplus of 2-4% in the past four years while the typical western country was suffering deficits of 6-10% in the global economic malaise, they were quick to appreciate how Hong Kong was managing to achieve "inclusive growth" in the past three years when tourism and inflow of other business opportunities had managed to create jobs that benefitted all segments of society especially the lower-skilled. They shared that other countries told them that they wanted to be "like Hong Kong". Also, in a number of meetings, the uniqueness of a fair and neutral Hong Kong was highlighted. This is very important for an Asian strategy (e.g. choosing an Asian headquarters) as the region is "radicalizing" with resurgence of nationalism in a number of countries. Most of the groups we visited had a good idea of our financial and economic capabilities from the many "muscle indices" (eg IPO's etc) in the market. Many were surprised just how good our "heart indices" are compared with the rest of Asia. These show that Hong Kong is a truly compassionate and trustworthy society. Mr. Thomas Woo said the Foundation has been visiting big cities including New York and Washington DC to promote Hong Kong and to explain its latest developments since 2005. The Foundation also organizes and receives high-level overseas delegations from political circles, academic institutions, think tanks, enterprises and research institutes to exchange opinions and position on different social issues, through forums and conferences. Such activities are more effective, comparing to official interaction, in building trust and friendship. He believed the Foundation could play an important role not only in assisting our government to fight for the interests of Hong Kong, eg the Visa Wavier Program of the U.S., but also to promote the image of Hong Kong and China as a whole internationally. Ms. Diana Chou noted a marked difference as our Hong Kong pitch was enhanced by the presentation of Mr. Franklin Lam. His research indicated that Hong Kong is not just a financial and trading hub in Asia, but also a city of culture and art where major international events such as Art Basel Hong Kong congregates. It’s the first time she felt perhaps Hong Kong should stand on its own merit as we become a world class city. The success of Hong Kong reflects how well the "One Country Two Systems" works. She hopes Hong Kong people should be constantly reminded and be proud of our heritage and unique geographical location as the super connector to Asia and gateway to our motherland. Mr. Sebastian Man was gratifying to hear that the international community continued to have a positive view of Hong Kong. Of course, they are all well aware of the issues we face, the politics, the economic challenges, etc. On the politics front, while people do feel it is a healthy debate and a natural process towards democracy, it is important that we get our act together soon. In that context, it is good news to learn that the U.S. is working on visa waiver for Hong Kong. However, it is by no means a certainty and in fact, there are still challenges and we are delighted that we were able to put in our words to the people we met as well.   Ms. Juliana Lam was impressed that there are many passionate people running different U.S. organizations and contributing their lives in order to bridge the understanding of the U.S. and China, bonding the two countries together from all kinds of aspects including culture exchange, political view sharing, etc. They are successful leaders and devote themselves to achieve these goals which echo the mission of the Foundation. Mr. John Lee joined the delegation for the first time and said it has truly been an amazing experience during the four day visit to New York and Washington DC. Furthermore, this trip has been particularly memorable as it also coincided with our Honorable Chief Executive’s visit to New York. During our visit, we met with a number of business associations as well as government officials to share our views of Hong Kong and to promote the unique advantages of Hong Kong to further assess potential opportunities in this vibrant city. As the Chief Executive said in his speech, Hong Kong is "a Madison Avenue of the East and a super-connector in linking U.S. firms to markets in the Mainland of China and across Asia". Hong Kong indeed has many unique advantages and as a Council Member of the Foundation, he hopes to continue to promote the merits and opportunities in Hong Kong. Ms. Tang expressed her sincere gratitude to the delegates and all organizations visited for their support in making the delegation a success. This regular updates and dialogue with the business community in New York and among interlocutors inside the Beltway is important in enhancing greater mutual understanding. The Foundation will endeavor to organize these kinds of visit to promote better understanding and collaboration. For detailed itinerary, photos, bios of delegates and presentation of Mr. Franklin Lam, please visit the "Highlights of Past Activities" section of the Foundation’s website. More photos of the delegation could be found at the "Photo Gallery" section. For enquiries, please contact Ms. Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / (852) 6030 6025 or email: jimmie_chow@betterhongkong.org. – End –

2013 China Urban Competitiveness Report (Hong Kong)

2013.05.20
Press Conference of 2013 China Urban Competitiveness Report (Hong Kong) Organizer The Better Hong Kong Foundation Co-organizers Center for City and Competitiveness, The Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong (20 May 2013, Hong Kong) The Press Conference of 2013 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 20 May 2013. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2013 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni in The Chinese Academy of Social Sciences. A new future in 2030: the world will face a higher risk of instability due to changes in the world’s politics, economy and science & technology, multi-polarization and dispersion of power, and conflicts on resources and the environment. At the same time, to build a well-off society in 2030, China must change the current unsustainable urbanization mode in order to address the prevailing economic, political, cultural, social and environmental problems, and better respond to the challenges of sustainability in these aspects. Ideal city of sustainable competitiveness is the new goal of Chinese cities’ development. In view of this, the Project Team of Competitiveness of Chinese Cities has created the indicator of “urban sustainable competitiveness” and plans to carry out theoretical, empirical and case studies in the coming decade, aiming at the realization of sustainable development and enhancement of competitiveness among Chinese cities. The theme of this year’s report works on theoretical framework and assessment baseline. In accordance with the new theoretical framework, competitiveness is divided into short-term one and long-term one, and named comprehensive economic competitiveness and sustainable competitiveness respectively in this report. 293 cities (including cities from Hong Kong, Macao and Taiwan) are ranked by the Comprehensive Economic Competitiveness Index, while 287 prefecture-level cities (including Hong Kong and Macao) are ranked by the Sustainable Competitiveness Index. For the latter one, key indicators applied are extracted from eight major areas of livable city, business friendly city, harmonious city, eco-city, knowledge-based city, urban-rural integrated city, info-city and cultural city. The top ten cities in the Comprehensive Economic Competitiveness Index in 2012 are Hong Kong, Shenzhen, Shanghai, Taipei, Guangzhou, Beijing, Suzhou, Foshan, Tianjin and Macao. They are all coastal cities and the influence of location advantage to comprehensive economic competitiveness is obvious. In terms of administrative status of cities, Special Administrative Region, municipalities, vice-provincial cities, cities with independent planning and provincial capitals have stronger competitiveness. The top ten cities in the Sustainable Competitiveness Index in 2012 are Hong Kong, Shanghai, Shenzhen, Beijing, Guangzhou, Macao, Hangzhou, Qingdao, Wuxi and Jinan. Similarly, coastal cities have the advantage. A typical inverted U-shaped relationship is identified between the sustainable competitiveness and economic competitiveness, which indicates that the key to enhance the competitiveness of Chinese cities is not on the present comprehensive economic competitiveness, but rather how to raise the sustainable competitiveness and enhance the development potential of the Chinese cities, which can be regarded as the inherent requirement and inexhaustible power for transform Chinese mode of socio-economic development. Specific recommendations are given according to the aforementioned eight major areas. The four basic measures suggested are the implementation of balanced economic and social development strategy, the integration of urban and rural municipal management system, the formulation of policy on sustainable urban development and the establishment of long-term mechanism on the enhancement of sustainable urban competitiveness. Hong Kong keeps the top position in comprehensive economic competitiveness but the speed of growth is slowing down. The sub-index of overall efficiency competitiveness is 0.69968, ranked third after Taipei and Macao. Hong Kong has a significant advantage in GDP per unit of land, thanks to its dense population and commercial activities, a high degree of agglomeration, streamlined business regulations, a clean government, good supporting facilities and efficient services. However, the sub-index of overall incremental competitiveness is only 0.44534, ranked eighth after Taipei, Beijing, Guangzhou, Tianjin and Shenzhen etc. Hong Kong is suffering from the gradual weakening of the advantages in tax, talent, software and hardware facilities. Land shortage-induced high rents hinder the development of small and medium-sized enterprises. Hong Kong is also over-dependent on financial and real estate sectors and lacks stable sectors for growth. Hong Kong also has a top position in sustainable competitiveness but is weak in the sub-index of knowledge-based city. Hong Kong is ranked first with the index of 0.98029. Among eight sub-indices, Hong Kong tops in cultural city, urban-rural integrated city, harmonious city, business friendly city and livable city, while second in eco-city and third in info-city. Its index in knowledge-based city is 0.83988 and is ranked fourth after Beijing, Shanghai and Shenzhen. Hong Kong’s R&D expenditure, in terms of the percentage of GDP, is much lower than the one in Japan, South Korea, Singapore and the Mainland. Hong Kong also lacks programs supporting science and technology development and incentive system for technological innovation, along with the weak atmosphere of innovation and ability of knowledge transfer. All these are the major problems in Hong Kong. In addition to the insignificant transformation of the industrial structure towards innovation and technology, high dependence on the financial sector and real estate economically, rapid population aging and competition from global and the Mainland cities are the problems challenging Hong Kong’s sustainable development. The Project Team makes recommendations on the future development of Hong Kong in three aspects. First, the HKSAR Government should adjust its policy approach by developing long-term development planning on land policy, development of pillar and new industries, population policy and talent development. Second, to re-position Hong Kong according to the latest situation of the Chinese economy and to play its unique role and influence. Specifically, Hong Kong can enhance the cooperation of its enterprises with their mainland counterparts following the national policies on economic restructuring and “going-out” strategy. By participating in the development of an innovative country and the Greater Pearl River Delta economic circle, the people of Hong Kong can better understand the importance of regional cooperation towards regional prosperity and stability. Infrastructure can be better connected and exchanges and cooperation between the civil society and government can also be strengthened. Third, to promote scientific and technological innovation, and lead to the development of the knowledge-based economy by participating in the development of the "Shenzhen-Hong Kong Innovation Circle", the construction of the Asian intellectual property rights trading and service centre, the construction of overseas R & D and design centre of Mainland enterprises, and the implementation of "going-out" and "bringing-in" policies. Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “Hong Kong is a developed city and the overall performances on various areas are satisfactory. However, the financial crisis is still deepening, and the world economy is facing downturn while the international trade protectionism is arising. Nevertheless, the Asia-pacific region maintains a relatively rapid growth and China becomes the driving force for development. Urbanisation in the Mainland China is fast and with improvements. Hong Kong should assess the environment carefully so as to map out long-term strategies and short-term measures to cope with global changes as well as to seize every opportunity.” For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org.

The Better Hong Kong Foundation Concludes Its Annual Delegation Visit to the United States in June 2012

2012.07.11
(11 July 2012, Hong Kong) The Better Hong Kong Foundation (“the Foundation”) completed its annual delegation visit to the United States from 20 to 25 June 2012. A press conference was held today to brief members of the local media about the principal issues dealt with during their stay in the U.S. Members of the delegation also shared their observations and experiences gained from the trip. This year’s delegation was led by the Foundation’s Executive Committee Chairman Mr. Ronnie Chan, Chairman of Hang Lung Properties Ltd, and joined by four Foundation’s Council Members Mr. Philip Ma, Deputy Chairman & CEO of the Sincere Co Ltd; Mr. Sebastian Man, Chairman & CEO of Chung Mei International Holdings Ltd; Ms. Juliana Lam, Director of AML Group Holdings Ltd and Mr. Leung Wai-fung; and Executive Director Ms. Karen Tang. The Foundation also invited Prof. Liu Pak-wai, Professor of Economics of the Chinese University of Hong Kong as the chief commentator on economic affairs of the delegation. After introducing the delegates to the media, Ms. Karen Tang explained the main purpose of the delegation was not only to foster a better understanding of the political, economic and social developments in both the United States and Hong Kong, but also shared our observations and views with interlocutors in the United States on how Hong Kong business sector looked at the change in the governing philosophy and the business environment in Hong Kong and Mainland China under the new leadership. The potential of Hong Kong as off-shore RMB center was also highlighted. The delegation visited the Executive Branch (U.S. Department of State and U.S. Department of Commerce); members of the Legislative Branch (Congressional staffers and former Congressmen); think tanks (The Brookings Institution, The Heritage Foundation, National Committee on US-China Relations, Foreign Policy Association and US-Asia Institute); a financial institution (Morgan Stanley); a rating agency (Standard & Poor’s); and a university (George Washington University). The delegation also visited the Hong Kong Economic and Trade Office in Washington DC. The delegation was invited to luncheons and dinner hosted by the Embassy of the PRC in the U.S. (Ambassador Zhang Yesui and Minister Yang Zigang), the Permanent Mission of the PRC to the UN (Ambassador Li Baodong) and the Consulate-General of the People’s Republic of China in New York (Deputy Consul General Dong Xiaojun). At a luncheon speech titled “The Business and Economic Environment in Hong Kong and Mainland China under the New Leadership”, Mr. Ronnie Chan talked about his observations on the latest developments in China and the role of Hong Kong. He pointed out that the new leadership of both Mainland China and Hong Kong will be facing a more difficult situation than their predecessors because of the recent international financial crisis, various demands and higher expectations from the society and its people. However, Mr. Chan has confidence on the effort and determination of the new leadership of Mainland China and Hong Kong to address those issues and to sustain a steady growth of economy. Mr. Ronnie Chan asserted that the new leadership of Mainland China would continue its reform and opening up policy, not because of particular personnel but rather because of the “necessity”. Hong Kong under the one country two systems and the gateway to Mainland China will continue to benefit from the growth and development of our motherland. On the other hand, only a healthy and constructive Sino-U.S. relationship will benefit both countries, especially under the volatile international economy. However, it has never been an easy task, especially when the U.S. economy is facing challenges and the President election in November adds to the uncertainty. On the economic front, Prof. Liu Pak-wai highlighted the economic benefits to the development of Hong Kong into the premier international financial center as the Reminbi becomes an international currency for trading, investment and eventually foreign exchange reserve, a point that is not yet on the radar screen of most of our American host. Ms. Karen Tang observed the people we met showed considerable interest in the newly-elected Chief Executive of HKSAR, Mr. C Y Leung. In general, they all wished Hong Kong well. The interest on the change in leadership in Beijing later this year was strong. Some of them were concerned with the sociopolitical developments in Mainland China and to a lesser extent the slowdown of its economy. Prof. Liu Pak-wai commented that the American hosts in the United States Government, NGOs, think tanks and business were very friendly. He felt that there was a lot of goodwill towards Hong Kong in general and the Better Hong Kong Foundation in particular. The hospitality of the Chinese diplomats was overwhelming. Interaction with participants in our numerous sessions and among members of the delegation was very stimulating. He found the visit an intellectually and culturally enriching experience. Mr. Philip Ma had the impression that Americans enjoyed talking to Hong Kong business people on political and economic developments in Mainland China and Hong Kong; and Hong Kong continued to be seen as the gateway to Mainland China, the world’s second largest economy. Mr. Ma was particularly impressed by the sharing of Ambassador Li Baodong of his works in the United Nation, especially how he handled the complex and complicated international relationship. The strong message that Ms. Juliana Lam got during the trip was that Hong Kong has been undoubtedly a very advantageous metropolis. Owing to the geographical and historical factors, Hong Kong is not only established to enjoy the One Country Two Systems, but also allowed to enjoy the pioneer position as a bridge between Mainland China and other countries which has led Hong Kong to remain competitive in different areas. She hoped that Hong Kong would treasure these advantages and would continue to thrive. Although Mr. Sebastian Man and Mr. Leung Wai-fung were out of town and could not attend the press conference. However, they have written their comments earlier. Mr. Sebastian Man was gratified to see that the overseas community has continued to have positive and favorable views on Hong Kong. The general feeling was that 15 years of the One Country Two Systems by and large has worked. Most people felt that Hong Kong will continue to play a vital role in China’s continuous development, whether in the financial sector or because of its rule of law. People are also positive about Hong Kong’s gradual move towards democracy. In fact, public opinion significantly influenced the outcome in this election of the Chief Executive of HKSAR. Mr. Leung Wai-fung emphasized that gradual milestones and proactive efforts must be maintained to reconcile different understandings and expectations and through constructive communication between Hong Kong, Mainland China and the West. The world is focusing on bigger issues, such as strategic relationship between China and the U.S., the financial crisis in Europe and the U.S. and how they are impacting the world. And yet, the delegation also put forth the strategic role of Hong Kong, and its potential implication to the world’s economic landscape going forward. Mr. Sebastian Man, Ms. Juliana Lam and Mr. Leung Wai-fung joined the delegation to the U.S. for their first time. They said they benefited from the trip which was fruitful and meaningful. They hope the Foundation will continue this annual dialogue with counterparts in the U.S. Ms. Tang expressed her sincere gratitude to the delegates and all organizations visited for their support in making the delegation a success. This regular updates and dialogue with the business community in New York and among interlocutors inside the Beltway is important in enhancing greater mutual understanding. The Foundation will endeavor to organize these kinds of visit to promote better understanding and collaboration. For detailed itinerary, photos and bios of delegates, please visit the Foundation’s website: www.betterhongkong.org. For enquiries, please contact Ms. Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / (852) 6030 6025 or email: jimmie_chow@betterhongkong.org.

Press Conference of 2012 China Urban Competitiveness Report (Hong Kong)

2012.05.23
Organizer The Better Hong Kong Foundation Co-organizers Center for City and Competitiveness, The Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong (23 May 2012, Hong Kong) The Press Conference of 2012 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 23 May 2012. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2012 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni in The Chinese Academy of Social Sciences. In addition to the presentation by Prof. Ni at the press conference, the Foundation is also pleased to have invited Prof. Jeff Lin, Professor of Economics and Associate Dean of Institute for Advanced Studies in Humanities and Social Sciences of the National Taiwan University; Prof. Liu Chengkun, Associate Professor of Faculty of Management & Administration of the Macau University of Science & Technology; and Prof. Shen Jianfa, Hong Kong Institute of Asia-Pacific Studies of the Chinese University of Hong Kong to share their views and comments on the report. 1) Urban Competitiveness Ranking Hong Kong keeps the top position. The top ten cities in 2011 are Hong Kong, Taipei, Beijing, Shanghai, Shenzhen, Guangzhou, Tianjin, Hangzhou, Qingdao and Changsha. Comparing with the ranking result in 2010, the overall gap is narrowed with great changes in the ranking of some cities. Qingdao becomes one of the top ten city, replacing Dalian. Taipei rises to no. 2. Beijing overtakes Shanghai which becomes no. 4. Comparing with the ranking result of top 50 cities in 2010, there were more cities in the central region and more prefecture-level cities which were among the top 50 cities in 2011. Among vice-provincial cities, Chengdu improves the greatest, moving up by eight positions. Among provincial capital cities, Nanchong improves the greatest, moving up by ten positions. Among prefecture-level cities, Nantong improves the greatest, moving up by seven positions.        Prof. Pengfei Ni pointed out that the urban competitiveness of mainland cities has risen significantly in the past ten years. There is clear improvement in the northeast region. There are significant differences in urbanization in the central region with rapid rise of central cities. Large cities still lead all cities. There is strong competition among medium and small cities. Prefecture-level cities grow ahead of national average. The gap in the urban competitiveness has narrowed overall but increased in some regions. There is still a long way to change the mode of economic growth. 2) Hong Kong’s Urban Competitiveness Hong Kong has experienced several external economic shocks since its return to China. But its rank of urban competitiveness has risen continuously in the world. It has been the top city in China, leading the rapid rise of Chinese cities in the global competition. With outstanding key advantages, Hong Kong will not be caught-up by mainland cities in the near future. Hong Kong has strong advantages in advanced factors, infrastructure, ecological environment, institutional environment and social environment. Facilitated by the development in the mainland, Hong Kong’s position of international finance, trading and shipping centres has been consolidated. Although the gap between Hong Kong and mainland has been narrowed, it will take a long time for Shenzhen, Beijing, Shanghai and Guangzhou to catch-up with Hong Kong.        Enhanced economic structure which needs to be further improved. The share of service sector in GDP is well above 90%. The share of four pillar industries in GDP also rose from 48.8% in 2001 to 58.0% in 2010. The producer service is dominated by financial and professional service sectors. Its development is benefited from the growth of mainland economy. The jobs created by this sector are limited. Income level grows significantly with a large income gap. The income level has been increased in the past ten years. GPD per capita in Hong Kong increased by 41.3% in the period 2001-2010, reaching US$31,700 in 2010. In the same period, the income level rose by 60% among the top 10% people while the income level decreased by 20% among the bottom 10% people. Guangdong-Hong Kong regional cooperation has been sped up in the past ten years and further breakthrough in cooperation mechanism is expected. The areas for cooperation have extended with many innovations in cooperation modes. The positioning of cooperation has changed from attracting foreign investment to building most active and competitive metropolitan region in the world. The objective of cooperation has been enhanced. The report suggested that Hong Kong should make efforts to become a most sustainable and competitive world city to respond to global challenge, lead the development of mainland cities and raise the well-being of Hong Kong residents. Specifically, the following measures can be adopted: develop knowledge economy, enhance the leading financial sector, build a city of science and education, promote R&D and innovation, construct low-carbon city and protect ecological environment, promote inclusive growth and build harmonious city, further opening and keep high freedom, develop multi-cultures and lead urban civilization. 3) Analysis on the Changing Urban Competitiveness of Hong Kong from a World City Perspective Prof. Jianfa Shen pointed out that a research team in the Chinese University studied the changes in urban competitiveness of Hong Kong in the period 2000-2009 from a world city perspective is conducted. The result was published in “The 2012 China Urban Competitiveness Report”. The indicator system used in this study consists of a performance section and an explanation section. All indicators are normalized to a value of 0 to 100. The performance of urban competitiveness of Hong Kong has four components – global control functions, financial sector, services sector and external linkages. The overall performance of urban competitiveness of Hong Kong has been increased since 2000. This means that the world city status of Hong Kong has been strengthening. The overall performance of Hong Kong began to decline due to the outbreak of global financial crisis in 2008. The score was dropped by 10 points in 2008 and another 5 points to reach 85 in 2009. The performance of financial sectors and service sectors managed to bounce back slightly in 2009. In the explanatory section of urban competitiveness, five pillars, vibrant economy, educated and adequate workforce, quality environment, stable society and adequate transportation and telecommunication infrastructure, are used to explain the change in the urban competitiveness of Hong Kong. Both indexes of vibrant economy and transportation and telecommunication infrastructure have exbited a similar rising trend since 2001. They reached their peaks in 2008 and 2009 respectively. Index of educated and adequate workforce dipped slightly in the early 1980s and kept rising to 2009. The index of quality environment fluctuated considerably in the period 1990-2006. It then rose to its peak in 2008. The index of stable society rose and fell like a roller-roaster. Within just six years from 1999 to 2005, this index reached its best performance in 2002 and its poorest performance in 2005. The index of vibrant economy consists of five sub-indexes, market efficiency, international investment, firms’ performance, innovation-conducive environment and supply of offices. The indicator of reseach and development by higher education and government rose gradually in 2004 and then grew greatly after 2006. Although the government of Hong Kong has recognized innovation and technology as one new area for development, it still has to put more resources to stimulate the growth of local industries. The percentage of employed persons holding a degree and age participation rate for first degree programmes and postgraduate programmes in local universities, constitute the sub-index of quality of workforce. Talent is a core factor of the urban competitiveness of Hong Kong. Although the proportion of labour force with post-secondary education rose from 24% in 2000 to 31% in 2010, it still lagged behind some global cities such as London. In London, the figure with degree education already reached 31% in 2005. Major mainland cities also catch up rapidly. In 2010, 31.5% and 22.0% of the population in Beijing and Shanghai had education of junior college and above respectively. The index of stable society comprises five sub-indexes, health, housing, employment condition, purchasing power, and security and corruption. The sub-index of employment condition rebounded reached a new high in 2008. Whereas the trough of the sub-index of security and corruption was in 2003, its peak was in 2008. The sub-index of health has climbed up since 1980. The sub-index of purchasing power failed to sustain the rebound in 2001 and 2006. It was at its lowest level in 2008. The sub-index of housing had a decreasing trend. This sub-index scored 100 in 1985. It dropped to a score of 30 in 2008. Unaffordable housing and declining purchasing power are two potential sources of social instability in Hong Kong. All explanatory indexes have basically performed well in recent years. Nevertheless, attention should be drawn to the sub-indexes of housing and purchasing power. These sub-indexes suffered a decline in recent years, and their future performance is likely to affect the growth of urban competitiveness of Hong Kong in the future. It is clear that the financial services and advanced producer services provided by Hong Kong are still the most advanced among all cities in China. Hong Kong is likely to maintain an indispensable role in the modernization of China. Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “The competitive edges, such as strong global control functions and services sectors, will enable Hong Kong to occupy the higher end of the value chain, fortifying her role as gateway connecting China and Asia with the world. It should be recognized that all these competitive edges will, in turn, fortify the status of world city.” For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org. – End –

“China’s Peaceful Development and the International Environment – China’s Relations with the West and the Role of Hong Kong in the Post Crisis Era” by Ms. FU Ying Vice Minister of Foreign Affairs, People’s Republic of China

2011.07.11
Vice Chinese Foreign Minister Fu Ying’s Speech on China’s Relationship with the West and the Role of Hong Kong   On the evening of 11 July, visiting Vice Chinese Foreign Minister Fu Ying attended a dinner at the Dynasty Club hosted by the Better Hong Kong Foundation and Asia Society Hong Kong Center. Fu Ying delivered a speech titled “China’s Relationship with the West and the Role of Hong Kong” to nearly 200 people from various sectors of the Hong Kong society and representatives of consular and representative offices of foreign countries and international organizations in Hong Kong. Fu Ying acknowledges Hong Kong’s success, prosperity and development since its return to China 14 years ago. She shares several observations on economic recovery and development of European countries in the aftermath of the financial crisis, cooperation opportunities and difficulties in China’s relationship with the West and the role of Hong Kong. Fu Ying says that the worst moment of the financial crisis is over. Germany is leading Europe in steady recovery and countries such as Ireland are on the way up. But generally speaking, many countries in the developed world are suffering from low growth rate and high unemployment. Emerging economies are confronting with mounting inflationary pressure and inflation has spread to developed countries, affecting consumption there. In the face of severe challenges and public pressure, some countries are actively promoting reforms to get out of the troubles. China is observing and pondering these issues. Fu Ying says that the international community, especially European countries, is having high expectations on cooperation with China. During Premier Wen Jiabao’s recent visit to Europe, China and relevant countries signed dozens of business agreements worth over 20 billion dollars. Agreements were also reached on strengthening cooperation in the fields of SMEs, people-to-people exchanges, innovation and education. China and Europe look forward to go beyond the relationship of buyer and seller. Both approach bilateral cooperation from a strategic perspective, seeking converging points between China’s 12th Five Year Program and the Europe 2020 strategy. We aim to promote common prosperity through stronger cooperation. She also says that China’s relationship with Europe and West at large is not without problems though. “China’s human rights issue” for example, is like a tall hat that is forced upon China. In spite of China’s human rights improvements over the past decades, the interest is shifted from the rights of the Chinese people to a narrower content, namely, the right of a few people to subvert China’s political system. Those who argue against China seem to be more interested in this than in the advance of the rights and interests of the vast majority of the Chinese people. That’s one of the reasons why it’s difficult to get ideas across at human rights dialogues. China’s current path of development is the result of many trials over a long historical period and will be followed through. There are many examples of China’s active promotion of democratic progress, which aims at extensive participation and representation of the people in the decision making. China still has a long way to go. It is willing to discuss human rights with Western countries, but it has to be built on the basis of mutual respect, equality and respect for fact. Fu Ying also mentions the West’s concern over where China is heading. Some economic issues are often politicized. This is, in fact, unnecessary. We are living in a fast-changing, globalized and highly interdependent world. As long as we can work together with sufficient patience, it is possible for us to grow together and solve problems together. Fu Ying disagrees with the view that the power of the world is shifting from the West to the East. Instead, there is a diffusion of capital, technology, resources and market from the West to a wider world, especially developing countries. If only one billion or so people of the OECD countries were enjoying modern life as a result of industrialization, now 3 billion or even more are joining in.  When discussing “Shi”, or the main trend of the world, she says that Deng Xiaoping made a judgment in the early 1980s that the main trend of the world was peace and development. In the 30 years since, China has stayed committed to this trend and spares no effort to promote national development and international partnerships. Last year when visiting France, President Hu Jintao said we should work together to make the 21st century one of peace, cooperation and development. This is a bold idea. If we could make it, it would become the first in modern world history. The vision itself speaks volume about the orientation of China in global affairs. China will not waiver, will not tire and will not Zheteng (flip-flop) in its pursuit of peace, development and cooperation. We also hope the West can take China as an equal partner, strengthen our mutual trust and work whole-heartedly with China in cooperation. Fu Ying says that Hong Kong has always been a bridge between China and the world. In the 14 years since its return, Hong Kong has accomplished political stability and economic prosperity with the full support from the central government, the effective administration of the SAR government, the hardworking spirit of the people of Hong Kong and extensive support from the international community. As more and more enterprises from the Mainland are investing abroad and increasing their international presence, Hong Kong can fully tap into its strengths of information, expertise and talents. Hong Kong will have a new a bigger role to play as a bridge. Fu Ying says that the continued success of “One Country, Two Systems in Hong Kong” needs continued acknowledgement by the international community that the two systems of the Mainland and Hong Kong operate within the framework of one and the same country. “One country” is the prerequisite of “Two Systems”. Hong Kong is part of China. There are many consular and representative offices of foreign countries and international organizations in Hong Kong and many international friends, too. They have played an important role in advancing the exchanges and cooperation between Hong Kong and the world. It is hoped that our foreign friends will continue to respect China’s sovereignty, respect the Basic Law and make positive contribution to Hong Kong’s development and stability. We wish for a better Hong Kong, a better China and a better world. After the speech, Fu Ying also interacted with the audience on topics including education, the South China Sea, China’s national defense development and intellectual property rights, etc.

The Better Hong Kong Foundation Concludes Its Annual Delegation Visit to the United States in May 2011

2011.06.07
(7 June 2011, Hong Kong) The Better Hong Kong Foundation (“the Foundation”) completed its annual delegation visit to the United States from the 16 to 19 of May. A press conference was held today to brief members of the local media about the principal issues dealt with during their stay in the U.S. Members of the delegation also shared their observations and experiences gained from the trip. Led by the Foundation’s Executive Committee Chairman and Chairman of Hang Lung Properties Ltd Mr. Ronnie Chan, members of this year’s delegation included four Foundation Council Members, Mr. Joseph Yu, Chairman of Roseville Group of Companies, Mr. Albert Ip, Independent Non-Executive Director of Eagle Asset Management (CP) Ltd, Mr. Philip Ma, Group Managing Director of The Sincere Co Ltd and Ms. Diana Chou, Managing Director of Sino Private Aviation (HK) Ltd, as well as the Foundation’s Executive Director Ms. Karen Tang. After introducing the delegates to the media, Ms. Karen Tang reiterated the main purpose of the delegation which was to provide an annual update about Hong Kong’s present situation, to share our perspectives on developments in China, and to exchange views with interlocutors in the United States and gauge the temperature in the Beltway regarding their views on developments in Hong Kong, Mainland China, the U.S. and the China-US relationship. The delegation visited the Executive Branch (U.S. Department of State and U.S. Department of Commerce); the Legislative Branch (Congressional staffers); think tanks (Brookings Institution, Carnegie Endowment for International Peace, CATO Institute, Heritage Foundation, National Committee on US-China Relations and US-Asia Institute); the Hong Kong Economic and Trade Office in Washington DC; a financial institution (Morgan Stanley); rating agencies (Standard & Poor’s and Fitch Ratings); and media (journalists from Barron’s Magazine, New York Post, Bloomberg TV, msnbc.com and NBC news). The delegation was invited to luncheons and dinner hosted by the Permanent Mission of the PRC to the UN (Ambassador Li Baodong), the Embassy of the PRC in the U.S. (Minister Yang Zigang) and the Consulate-General of the People’s Republic of China in New York (Deputy Consul General Dong Xiaojun). Mr. Ronnie Chan asserted “the Sino-U.S. relationship has been steering towards a stable and positive direction during this Obama administration. The parties that we met confirmed such observation especially when they saw the positive results of the U.S.-China Strategic and Economic Dialogue which had just been concluded few days before our visit.” He added that Hong Kong, as an international financial and capital formation center, benefits from growth in the China market on the one hand, and is functional in facilitating China’s progress towards its targets and working with its global partners on the other. People we met also concurred that Hong Kong has been doing very well and has never been better. At a speech he gave at an open luncheon, entitled “What does China’s 12th Five-Year Plan (12th FYP) mean to Americans – from the perspective of a Hong Kong Businessman”, Mr. Chan shared his observations of the latest developments in China and the role of Hong Kong. He explained the huge potential of the China market, demonstrated by the government’s commitment to economic growth, especially in the shift from an export-oriented economy to a domestic consumption oriented one. In response to the risk of a bubble in the property market, Mr. Chan said that there was no bubble as there was real demand in the market.  He stressed that the effort and determination of the central authority to control the surge in property prices could not be underestimated. Likewise, the targets set forth in the 12th FYP are good indicators for those who want to explore opportunities in China. Ms. Karen Tang observed that the interest in China is obvious and increasing in both the business community in New York and among interlocutors inside the Beltway. However, it is important to engage them with regular updates and dialogue. Mr. Joseph Yu commented that the issues of U.S. domestic economic predicament, global strategies and the relationship with China are already so complex and become more complicated when interests of different stakeholders are involved and become ‘politicized’. Mr. Yu is mildly optimistic about the future as the U.S. housing market ‘double dip’ is still hanging in the balance. However, he is confident that the leaders of China and the U.S. will cooperate and work to jointly overcome their differences over matters like RMB valuation, military collaboration and Chinese investment in sensitive areas such as intellectual property. Mr. Albert Ip said the soundness of Hong Kong’s banking system, the importance of Hong Kong as a conduit for IPO’s of Mainland companies, and its unique platform to capture the exponentially growing RMB trade and bond businesses, as well as the beginning of RMB priced IPO’s were well noted by interlocutors in the U.S. The high quality of universities in the SAR was also highlighted, especially the international orientation in providing exchange programs with overseas universities and the Western educated leadership.                                                                                                     Mr. Philip Ma was gratified that both China and Hong Kong are highly regarded by the international community, receiving high ratings from renowned rating agencies. Moreover, the discussion and exchange with the Permanent Mission of the PRC to the United Nations and the Consulate General of the PRC in New York on the China-U.S. relationship and other world affairs was insightful. The China diplomats were very appreciative of the work of the Foundation. Ms. Diana Chou regarded this trip as informative for both sides. Hong Kong can serve as a platform to bridge the understanding between the East and West especially between China and the U.S. Ms. Chou concurred with Mr. Chan that the Chinese have been a peaceful race and that Chinese investment in the U.S. should not be misunderstood as economic aggression but more as a positive force to rejuvenate its economy and to job creation. Although the American government wants to attract overseas investment and promote its exports, there are still established blocks which hinder its attractiveness. An example was cited by Ms. Chou that ITAR (International Traffic in Arms Regulations) controlled equipment on PSB (Public Security Bureau) and Fire Fighting helicopters are being exported by European manufacturers to China and Hong Kong yet being restricted by its American counterparts.  Ms. Chou suggested to review its export policy. Both Mr. Philip Ma and Ms. Diana Chou are new Council Members and it was their first time joining the delegation to the U.S. They said they benefited from the trip which was fruitful and meaningful. They hope the Foundation will continue this annual dialogue with counterparts in the U.S. Ms. Tang expressed her sincere gratitude to the delegates and all organizations visited for their support in making the delegation a great success. The Foundation will continue its dedication to enhancing greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. The Foundation will endeavor to organize these kinds of visits for more exchanges and to promote better mutual understanding. For detailed itinerary, photos and bios of delegates, please visit the Foundation’s website: www.betterhongkong.org. For enquiries, please contact Ms. Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / (852) 6030 6025 or email: jimmie_chow@betterhongkong.org. – End –

The Better Hong Kong Foundation Accomplished Its Annual Delegation to the United States in May 2010

2010.06.03
(3 June 2010, Hong Kong) The Better Hong Kong Foundation (“the Foundation”) completed its annual delegation to the United States from 12 to 19 May this year. A press conference was held today to brief members of the local media about the main issues dealt with during their stay in the U.S. Members of the delegation also shared their observations and experiences gained from the trip. Led by the Foundation’s Executive Committee Chairman and Chairman of Hang Lung Properties Ltd Mr. Ronnie Chan, members of this year’s delegation included three Foundation’s Council Members Dr. Roy Chung, Vice Chairman & Executive Director of Techtronic Industries Co Ltd, Ms. Winnie Ng, Director of the Kowloon Motor Bus Co. Ltd and Mr. Lau Ming Wai, Director of Chinese Estates Holdings Ltd, as well as the Foundation’s Executive Director Ms. Karen Tang. After introduced the delegates to the media, Ms. Karen Tang briefed the main purpose of the delegation which was to provide an annual update about Hong Kong’s present situation, to share our perspectives on the developments in China, and to exchange views with the interlocutors in the United States and gauge the temperature in the Beltway their views on the developments in Hong Kong, the Mainland China, U.S. and the China-US relationship. The delegation visited the Executive Branch (U.S. Department of State, U.S. Department of Commerce, U.S. Department of Treasury and National Security Council); the Legislative Branch (Senator Mitch McConnell (the Senate Republican Leader Senator), Congressman and staffers); think tanks inside the Beltway (Brookings Institution, Carnegie Endowment for International Peace, CATO Institute, Heritage Foundation, Peterson Institute for International Economics and US-Asia Institute); the Hong Kong Economic and Trade Office in Washington DC; financial institutions (Morgan Stanley and HSBC); rating agencies (Standard & Poor’s and Moody’s) and think tank in New York (National Committee on US-China Relations); and media (The Nelson Report, the Wall Street Journal, the Economist and the columnist of Forbes). During the mission in New York, Mr. Ronnie Chan gave a speech entitled “Is the Sky Really Falling in U.S. & China” at the luncheon hosted by the Museum of Chinese in America to share his views on the U.S.-China relation. By the invitation of the Columbia Business School, Mr. Chan gave another speech entitled “Economic Implications of the Property Market Boom in China and Hong Kong” at the Sir Gordon Wu Distinguished Speaker Forum where over hundred people attended. (To view the video of the speech, please visit http://www4.gsb.columbia.edu/chazen/events/wuspeakerseries.) A reception and dinner were hosted by the Hong Kong Association of New York where members of the delegation exchanged views with friends from the local business community. The delegation were invited to luncheons and dinners hosted by the Permanent Mission of the PRC to the UN (Ambassador Li Baodong), the Embassy of PRC in the US (Minister and Deputy Chief of Mission Xie Fung) and the Consulate-General of the People’s Republic of China in New York (Deputy Consul General Dong Xiaojun). Mr. Ronnie Chan said the future of Hong Kong is certain under the humongous economic developments in China. The financial sector of Hong Kong will continue to thrive and play a significant role in the economic development of China. Mr. Chan also shared his views on the RMB valuation as it is a hot topic amongst the interlocutors in the U.S. Mr. Chan thought that the RMB might gradually appreciate and a wider range of exchange rate might be allowed. However, it will not be under the pressure of foreign country but rather because of the internal need for a more flexible and convertible currency in the long run. As agreed almost unanimously, the appreciation of RMB will not help narrow the trade deficit between the U.S. and China. Mr. Chan also expressed his confidence in the leadership of China and believed they would take appropriate measures to sustain the growth of the country while putting importance to a cordial China-US relationship. As a successful manufacturing industrialist with his own company set up in Hong Kong, Dr. Roy Chung used his experience as an example to illustrate the competitiveness of Hong Kong as it is a place where he could efficiently raise capital for the expansion of his company and easily draw talents from around the globe to form an international management team. He also added that its proximity to the Mainland provides Hong Kong with low cost labour and a huge potential internal market. As an international hub, Hong Kong facilitated the expansion of his company into the global market. Dr. Chung concurred that RMB is likely to appreciate gradually. However, it will not impair China’s economic development as China is dedicated to upgrade its industry and to develop its internal market. He thought that trade deficit between China and the U.S. is not a unilateral issue. It should be addressed by both countries. Ms. Winnie Ng commented that the meetings with leaders from the political and business sectors in U.S. during the mission were fruitful. With the strong economic growth and development, China is getting more attention from the world. Hong Kong with its special geographical advantage, its unique system of “One Country Two Systems” as well as its sound pillars is well positioned to capture the benefits in the course of the development of our nation and to continue to strive. The interlocutors in the U.S. recognized the competitiveness of Hong Kong which attributed to its unique administrative system. Mr. Lau Ming Wai commented that the Foundation’s delegation to the United States was a resounding success. “Through our dialogues with senior policymakers, think tanks, and other organizations, we learnt that the United States maintains a keen interest in Hong Kong. To them, Hong Kong has always been and continues to be a beacon of economic freedom and prosperity. Needless to say, China is at the forefront of everyone’s mind, especially in the midst of the Strategic and Economic Dialogue (S&ED) between the two countries. Hong Kong should continue to act as a bridge into China and be its showcase to the world. I am very pleased with the constructive dialogues that we have had in Washington, DC and I look forward to a similar trip next year.” Ms. Karen Tang said Hong Kong is in a good shape in the eyes of most U.S. interlocutors. There was not much concern over Hong Kong while the China-U.S. relation remained the key focus of our dialogues. The valuation of RMB and the indigenous innovation policy of China did create tension between the two countries. However, people are positive in the China-U.S. relationship and the direction that the U.S. Administration is driving at.   Ms. Tang expressed her sincere gratitude to the delegates and all organisations visited for their support in making the delegation a great success. The Foundation would continue its dedication in enhancing greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. The Foundation would endeavour to organise this kind of visits for more exchanges and to promote better understanding to each other. For detailed itinerary, photos and bios of delegates, please visit the Foundation’s website: www.betterhongkong.org. For enquiries, please contact Ms. Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / (852) 6030 6025 or email: jimmie_chow@betterhongkong.org.

Press Conference on 2010 China Urban Cities Competitiveness Study (Hong Kong)

2010.04.07
Organizer The Better Hong Kong Foundation Co-organizers Center for City and Competitiveness, The Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong (27 April 2010, Hong Kong) The Press Conference of 2010 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 27 April 2010. It is organized by The Better Hong Kong Foundation and co-organized by Center for City and Competitiveness*, The Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2010 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni in The Chinese Academy of Social Sciences. The urban competitiveness of 294 cities in mainland China, Taiwan, Hong Kong and Macau in 2009 is analyzed. 1) Urban Competitiveness Ranking The top 10 cities in overall urban competitiveness are: Hong Kong, Shenzhen, Shanghai, Beijing, Taipei, Guangzhou, Tianjin, Kaohsiung, Dalian and Qingdao. Hong Kong is also ranked the 1st in the scale competitiveness, economic efficiency, industrial competitiveness and income competitiveness. Comparing with previous year, Hong Kong moved from the 2nd position to the top position in the scale competitiveness, economic efficiency and industrial competitiveness while income competitiveness remained at the top position. Hong Kong is ranked 4th in the development cost competitiveness, down from the top position in previous year. Comparing with rapidly growing cities in the mainland, Hong Kong is ranked 289th in the growth competitiveness, down from 288th in previous year. 2) Hong Kong’s Urban Competitiveness Hong Kong has been ranked the top in urban competitiveness among Chinese cities for five years since 2005. Hong Kong has absolute advantage in overall urban competitiveness. Although there has been rapid urban development in Beijing, Shanghai and Shenzhen in recent years, they cannot overtake Hong Kong in the near future. Hong Kong has a large and mature economy. Its growth competitiveness is far behind other cities. But Hong Kong still has stable growth. Hong Kong’s advantage in scale competitiveness is being weakened. The gap between Shanghai and Hong Kong has been narrowed in the past 5 years. It was 0.26, 0.20, 0.17, 0.13 and 0.09 respectively. Hong Kong’s economic efficiency is much higher than other cities in the mainland. Mainland cities can learn a lot from Hong Kong. Their development model should be changed from the one based on expansive growth using cheap labour to the one based on quality endogenous growth. Development cost competitiveness refers to the consumption of resources and environmental pollution in the process of urban development. Hong Kong has a relative advantage in this indicator in the past five years. But it has been weakened clearly. Service sector dominates Hong Kong’s economy. The share of high-tech industry is small. The pace of industrial upgrading is slow. Hong Kong leads other cities in industrial competitiveness tentatively. But its gap with Beijing and Shanghai has been narrowed. Hong Kong has relatively high household income and public revenue. Residents have good living conditions and high quality of life, provided with excellent public facilities. Hong Kong has high income competitiveness. 3) Strategic Measures on Future Urban Development in Hong Kong A global city strategy. Hong Kong leads other economies in the world in areas of financial services, trade freedom, legal system and business management. As a leading city in the world, Hong Kong should aim to become a world class city in global city competition. It should facilitate economic development in Asia, regional economic integration in China and leading the integration of PRD metropolitan region with the world. Coordinating national planning, re-positioning Hong Kong. With globalization and rapid urbanization in China, various central and local governments should adjust the urban system plan in greater China, taking Hong Kong, Macao and Taiwan into consideration. Hong Kong should be included in the 12th FYP, endorsing the planning of Hong Kong as a world class city. Hong Kong also needs to make its own long term strategic plan. Improving industrial structure, leading key industries. HKSAR government should make clear and effective industrial development strategy and policy. The government should foster a good environment, attract and support the development of key high-tech manufacturing and knowledge-intensive service sectors. Promoting the linkage of software, speeding up the direct link of hardware. To become a global city, Hong Kong needs to speed up integration with the mainland especially PRD. Promoting software integration and extending CEPA, gradually achieve the free flow of people, goods, services, currency, capital, technology and information; free exchange between RMB and HK dollar; “co-location” inspection. Promoting hardware integration. Hong Kong should be included in the planning, construction and operation of national infrastructure to achieve seamless direct link. Developing education hub, improving living environment. Developing a high quality life-long education system in Hong Kong. Raising the participation rate of higher education to foster creative skills. Cooperating with the mainland closely to control urban and regional environmental pollution and create a quality living environment. Enhancing science and technology, developing knowledge economy. Hong Kong should become a global innovation center. HKSAR government should make a strategy of building an innovative city to support the basic and applied research of science and technology. Create good business environment so that endogenous innovation can become a key driver of economic transformation and the development of knowledge economy. 4) Remarks on the Result of Urban Competitiveness Study Prof. Yue-man Yeung from The Chinese University of Hong Kong and Prof. Jianfa Shen from Hong Kong Institute of Asia-Pacific Studies of the same university commented on the result of urban competitiveness study in the press conference. Prof. Yue-man Yeung pointed out first that, as the eighth annual report on the competitiveness of Chinese cities, the focus of this year’s report is “the linked fortune of cities and countries” in their competitiveness. This is a rational conceptual angle through which to examine the competitiveness of Chinese cities and the growing economic power of China. This report has uncovered no surprises in the competitiveness of Chinese cities. What is noteworthy is that the gap between Hong Kong and other Chinese cities in their relative competitiveness has been narrowed over the past five years. While Hong Kong’s advantages are still strong and unique among Chinese cities, they must be further strengthened and reinvented for a more enhanced role of Hong Kong to play in the future global economy with China likely to figure more prominently. Chapter 10 of the report examines Hong Kong’s competitiveness. It revealed the comparative advantages of Hong Kong relative to China, Asia and indeed the world. What is most important for us is to seriously consider the future strategic position of Hong Kong as a global city beyond its present world city status. It is envisaged that Hong Kong can be developed as the leading city in Asia, overtaking Tokyo, and will join London and New York as the three most global financial centers. Prof. Jianfa Shen pointed out that Hong Kong has been ranked the most competitive city in China for five years by the “China Urban Competitiveness Report”. The study team in the Chinese University of Hong Kong designed a comprehensive urban competitiveness index (UCI) which consists of four components: economic performance, global linkage, social well-being and environmental quality. It is used to analyze the changes of Hong Kong’ UCI since 1990. The index ranges from 0 to 100. They find that Hong Kong’s UCI was the lowest in 1992 and the highest in 2008. During 1990-2001, the UCI was rising slightly with fluctuation. It reached low values in 1992, 1997 and 2001 respectively. Poor economic performance contributed to low UCI values in 1992 and 2001. Poor environmental quality contributed to low UCI values in 1992 and 1997. Poor social well-being contributed to low UCI values in 1997 and 2001. UCI rose steadily after 2003 with significant improvement in all four components. Among the four components, the most robust was the steady expansion of the global linkage in the period. The economic performance and social well-being fluctuated greatly around 1997, reaching the bottom in 2000 and 1997 respectively. The environmental quality was the best in 1998-2002 when the economy was stagnant. It has been improved from the bottom in 2004. To improve Hong Kong’s urban competitiveness, the government and society need to take both economic, social and environmental measures. Concluding the press conference, Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “As a global city, Hong Kong will develop into a world class metropolis in the future. Hong Kong will grow by capitalizing the opportunities in the mainland China and beyond. It will also provide advanced services to Asian and the world. It will be the place hosting the headquarters of transnational corporations from Asia and the world. Hence, to realise the recommendations of improving the living environment, developing Hong Kong as an education hub, providing an effective industrial development strategy, being included in the 12th FYP as a world–class city in China, cooperating and coordinating with the Mainland cities, etc are the key to keeping Hong Kong as the forerunner in the globe.” For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / 6030 6025 or email: jimmie_chow@betterhongkong.org. * “The China Urban Competitiveness Report” is originally one of projects under Institute of Finance and Trade Economics of the Chinese Academy of Social Sciences. After years of effort made by Prof. Pengfei Ni, the Academy set up the Center for City and Competitiveness of which Prof. Ni is appointed as Director. The opening ceremony of the Center was held at the press conference of the Report in Beijing yesterday. – End –

The Better Hong Kong Foundation Spring Luncheon & Media Gathering

2010.02.02
To celebrate the Year of Tiger with the Foundation’s members and to strengthen our communication with our media friends, the Better Hong Kong Foundation held its annual spring luncheon and media gathering at the Dynasty Club on 2 February 2010.  The event was hosted by the Foundation’s Advisory Council Chairman Dr. Henry Cheng and chaired by the Foundation’s Executive Committee Chairman Mr. Ronnie Chan. Members of the Foundation including Trustees Mr. W F Leung, Tan Sri Dato’ David Chiu and Dr. Sumet Jiaravanon’s representative Ms. Li Xuhua; Council Members Dr. Choi Lung-wai, Dr. Roy Chung, Mr. Eric Leung, Mr. Thomas Woo, Dato’ Dr. S J Wong, Ms. Winnie Ng, Ms. Judy Yu, Mr. Joseph Yu, Mr. David Fong, Mr. Tony Choi and Mr. Albert Ip; and Executive Director Ms. Karen Tang joined the luncheon where they exchanged views on the future development of the Foundation.   The media gathering that followed was well attended by some 40 journalists. The Foundation’s members and friends from the media enjoyed the sharing and good wishes for prosperity for 2010. Members attending the media gathering included:   Trustees –  Mr. Ronnie Chan                      Chairman, Hang Lung Group Ltd –  Tan Sri Dato’ David Chiu          Chief Executive Officer, Far East Consortium International Ltd Council Members –  Dr. Roy Chung                          Vice Chairman & Executive Director, Techtronic Industries Co Ltd –  Mr. Eric Leung                          Chief Executive Officer, Tao Heung Group Ltd –  Mr. Thomas Woo                     Executive Managing Director & General Manager, Hsin Kuang Restaurant (Holdings) Ltd –  Dato’ Dr. S J Wong                  Founder, SBI E2-Capital Asia Ltd                 –  Ms. Winnie Ng                          Director, The Kowloon Motor Bus Co Ltd –  Ms. Judy Yu                             President, Carsac Ltd –  Mr. Joseph Yu                          Chairman, Roseville Group of Companies –  Mr. Tony Choi                          Executive Director, Hong Kong Garment Mfg Co Ltd –  Mr. Albert Ip                             Managing Director of Investments, Merrill Lynch (Pacific Asia) Ltd –  Ms. Karen Tang                         Executive Director, The Better Hong Kong Foundation

The Better Hong Kong Foundation Organised Its Annual Mission to the United States in April 2009

2009.05.05
The Better Hong Kong FoundationAccomplished Its Annual Delegation to the United States in April 2009 (5 May 2009, Hong Kong) The Better Hong Kong Foundation (“the Foundation”) organised its annual delegation to the United States from 23 to 29 April this year. A press conference was held today to brief members of the local media about the main issues dealt with during their stay in the U.S. Members of the delegation also shared their observations and experiences gained from the trip. Led by the Foundation’s Executive Director Miss Karen Tang, members of this year’s delegation included guest speaker Mr. Antony Leung, Chairman of Greater China, the Blackstone Group (HK) Ltd and former Financial Secretary of HKSAR; and two Foundation’s Council Members Ms. Winnie Ng, Director of the Kowloon Motor Bus Co. Ltd and Mr. Albert Ip, International Advisory Council Asia of Washington University, St. Louis. Miss Karen Tang said, “The main purpose of the delegation was to provide an annual update about Hong Kong’s present situation, to share our perspectives on the developments in China, and to exchange views with the interlocutors in the United States and gauge the temperature in the Beltway their views on the developments in Hong Kong, China, U.S. and the China-US relationship especially under the new Obama administration.” The delegation visited financial institutions (Morgan Stanley and HSBC); rating agency (Standard & Poor’s) and think tanks in New York (National Committee on US-China Relations, Council on Foreign Affairs); the Executive Branch (U.S. Department of State, U.S. Department of Commerce International Trade Administration and National Security Council); the Legislative Branch (Senator, Congressman and staffers); think tanks inside the Beltway (Brookings Institution, CATO Institute, Heritage Foundation, US-Asia Institute); and the Hong Kong Economic and Trade Office in Washington DC. The group met with the Senator Jim Webb, Member Senate of Foreign Relations Committee and the Congressman Rick Larsen, Co-Chair of U.S.-China Working Group to brief them on the recent developments in Hong Kong. During the mission in New York, Mr. Antony Leung gave a speech entitled “China and Hong Kong: Post Financial Tsunami” at the luncheon hosted by the Asia Society. Over hundred          people attended. (The speech could be downloaded from the Foundation’s website.) In Washington D.C., Mr Leung made another speech at the Fund for American Studies, sharing his views on the China and Hong Kong’s Economic Outlook. Mr Leung is also Chair of the Panel on the session of “Working Towards Economic Recovery and International Balance” at the Harvard Conference – Power and Restraint: Perspectives on the U.S. and Chinese Relationship.  The delegation were invited to luncheons and dinners hosted by the Permanent Mission of the PRC to the UN ((Ambassador Zhang Yeshui), the Consulate-General of the People’s Republic of China in New York (Ambassador Peng Keyu), the Embassy of PRC in the US (Minister and DCM Xie Fung), and the Hong Kong-United States Business Council. Mr. Antony Leung said the interlocutors in U.S. basically understood and agreed that the proximity to China, low tax rate and simple tax regime, legal and regulatory systems that predictable and consistent, and accepted by international investors, freedom of information, safe and convenient place to life and work are fundamental competitive edges of Hong Kong. Regarding the announcement of Shanghai to be an international financial center in 2020, he expressed that with such a huge size of economy, it is sufficient for China to have more than one international financial center. The U.S. also has a few financial centers such as New York, Chicago and San Francisco. Being an international financial center, Hong Kong should further strengthen its existing advantages, strive to be the global offshore Renminbi center and regional center for derivatives, develop its business in Renminbi bonds as well as other well-regulated financial instruments. Hong Kong and Shanghai could achieve a win-win situation. However, to have a long-term and sustainable development, it is crucial for Hong Kong to attract and retain more talents around the world to work and live here. Moreover, Mr. Leung proactively explained to the U.S. that Hong Kong is not a “tax haven” and expressed our concerns about the possible rise of protectionism (no matter on trade, human resources, capital flow, etc) that may caused by further downturn of the world economy. The U.S. promised that they would keep a close watch on the development of these issues. Miss Karen Tang concurred that there was not much concern over Hong Kong. People in the U.S. were more concerned of their local economic issues and how to better engage China, hence there was much more interest in knowing if and how China can maintain 8% GDP growth and the impact of its economic stimulus package. “However, we do share our belief that with the increasing importance of China as a global economic powerhouse, the proximity of Hong Kong to the Mainland and the strong support from the Central Authority to Hong Kong, Hong Kong definitely can benefit and can rebound faster.”, said Miss Tang. Overall, people are positive in the China-US relationship and the direction that the new U.S. Administration is driving at.  Mr. Albert Ip emphasized the importance of the quality of human capital to the success of Hong Kong. He thought that it was crucial for university faculty members and students to have strong international skills and exposure, hence there should be more joint programs and exchanges arranged between universities in the U.S. and Hong Kong. He quoted the example of a joint program between Hong Kong Polytechnic University and Washington University in St. Louis. “The world is getting smaller, and there is much more interaction and interdependency”, said Mr. Ip. Universities in Hong Kong aim to get the best talents from the world, including the recently hired Chancellors at the Hong Kong University of Science and Technology and Hong Kong Polytechnic University who came from the U.S., where they held important positions at prestigious universities before the appointments. Having leaders with western academic background and experience will further build on the reputation and quality of local universities in Hong Kong. Miss Winnie Ng commented that the meetings with leaders from the political and business sectors in U.S. during the mission and the participation in activities of the Committee of 100 and Hong Kong-United State Business Council held concurrently in Washington D.C. have provided excellent platforms for ideas exchange and communications. She was gratified to see that the Foundation played a contributory role as a non-government diplomat to promote mutual understanding between Hong Kong. China and U.S.. Miss Tang expressed her sincere gratitude to the delegates and all organisations visited for their support in making the delegation a great success. The Foundation would continue its dedication in enhancing greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. The Foundation would endeavour to organise this kind of visits for more exchanges and to promote better understanding to each other. For detailed itinerary, photos and bios of delegates, please visit the Foundation’s website: www.betterhongkong.org. For enquiries, please contact Miss Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 / (852) 6030 6025 or email: jimmie_chow@betterhongkong.org. – End –

Press Conference on 2009 China Urban Cities Competitiveness Study (Hong Kong)

2009.04.15
Press Conference of 2009 China Urban Competitiveness Report (Hong Kong) Organizer The Better Hong Kong Foundation Co-organizers Institute of Finance and Trade Economics, Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong (15 April 2009, Hong Kong) The Press Conference of 2009 China Urban Competitiveness Report (Hong Kong) is held in Hong Kong on 15 April 2009. It is organized by The Better Hong Kong Foundation and co-organized by Institute of Finance and Trade Economics, Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2009 China Urban Competitiveness Report” project is led by Prof. Pengfei Ni in the Chinese Academy of Social Sciences. The urban competitiveness of 294 cities in mainland China, Taiwan, Hong Kong and Macau is analyzed. 1) Urban Competitiveness Ranking The top 10 cities in overall urban competitiveness are: Hong Kong, Shenzhen, Shanghai, Beijing, Taipei, Guangzhou, Qingdao, Tianjin, Suzhou and Kaohsiung. Hong Kong also ranked the 1st in the efficiency competitiveness, development cost competitiveness and quality of life competitiveness. Hong Kong is ranked the 2nd in the scale competitiveness, economic efficiency and industrial competitiveness after Shanghai, Taipei and Beijing respectively. Comparing with rapidly growing cities in the mainland, Hong Kong is ranked 288th in growth competitiveness. 2) Urban Competitiveness in Guangdong, Hong Kong and Macau Hong Kong, Shenzhen and Guangzhou are top three cities in urban competitiveness in Guangdong, Hong Kong and Macau. The Average competitiveness index of all cities in the region is 0.62, ranked 3rd among all regions in China. Among 23 cities in the region, 6 cities are among the top 20 cities in China. Another 8 cities are among the top 100-150 cities in China. Cities in the region are strong in the overall competitiveness, growth competitiveness scale competitiveness and development cost competitiveness. But they are weak in the efficiency competitiveness, quality of life competitiveness and industrial competitiveness. It is important for the region to enhance its competitive advantages and adopt effective measures to enhance competitiveness in weak aspects. Among the top 5 cities in the region, their ranking in the development cost is lower than other indicators. This indicates that these cities still follow the model of “high energy consumption and high pollution”. These cities should change their mode of economic growth and use the principle of sustainable development to guide economic development. 3) The International Position of Chinese Cities Among cities in the world, the comprehensive urban competitiveness of Chinese cities is at middle and lower level. There is huge difference in urban competitiveness among Chinese cities. But the economic growth rate of Chinese cities is the highest in the world. The top Chinese city, Hong Kong is ranked 20th in competitiveness among 500 cities in the world. Among 10 cities with the highest growth rate, 8 are Chinese cities. Among the 50 cities with the highest growth rate, 40 are Chinese cities. In terms of connectivity in the world urban network, Hong Kong, Beijing, Shanghai and Taipei have become important nodes. Hong Kong and Beijing are ranked 8th and 9th respectively among 624 cities in the world. They are Beta world cities and central cities in Asia-Pacific region. Shanghai and Taipei are ranked 19th and 22nd respectively. They are Gamma world cities. Guangzhou, Chengdu, Tianjin and Nanjin also play more and more important roles in world urban network.    4) Remarks on the Result of Urban Competitiveness Study Prof. Yue-man Yeung from The Chinese University of Hong Kong and Prof. Jianfa Shen from Hong Kong Institute of Asia-Pacific Studies of the same university commented on the result of urban competitiveness study in the press conference. Prof. Yue-man Yeung pointed out first that, with the 2009 report, Chinese cities have gone global in objectives and strategy. This is keeping with the heightened role China can and is expected to play, given the financial tsunami that US and EU countries have found themselves over the past few months. Second, Hong Kong continued to do well, ranking first again among all Chinese cities. Even in most of the 12 competitive indices, Hong Kong stayed within the top three. The weakest is cultural competitiveness and scientific and technological competitiveness. Hong Kong has to pay more attention to these. Third, Hong Kong is poised for even better economic and competitive performance in the immediate future. Specifically, the Outline for the Development and Planning of the Pearl River Delta (PRD) was officially released in January 2009 and Hong Kong, along with Shanghai and four Guangdong cities, has been designated a role in a cross-border renminbi clearing scheme. This will enhance Hong Kong’s position as a financial centre. The recent designation of Shanghai as an international financial centre by 2020 means Hong Kong will have to gear up its efforts to maintain its leading position and to work out a division of labour with Shanghai in the years ahead. Prof. Jianfa Shen commented that it is important to enhance economic integration between Hong Kong and PRD to enhance Hong Kong’s competitiveness. Hong Kong-Shenzhen cooperation is especially important. Improving cross-boundary facilities and services is one important measure to facilitate the movement of residents between two cities. The results of 2009 public opinion survey of research project “Inter-city Competition and Cooperation between Hong Kong and Shenzhen in the 11th Five-year Plan Period” revealed that most respondents are satisfied with the performance of government in the cooperation of cross-boundary infrastructure. Hong Kong residents believe that three most important problems to be solved for boundary crossing are the inadequate bus services in Shenzhen side (19.3%), long boundary crossing time (15.3%) and incontinent transit (15.1%). Some 15.6% and 19% of respondents have considered the possibility to live or work in Shenzhen or mainland cities respectively. Transport cost is an important factor in their decision of such relocation. Concluding the press conference, Ms Karen Tang, Executive Director of the Better Hong Kong Foundation commented that “the competitiveness of Hong Kong is ranked the highest amongst the cities in China and 26th amongst the 500 cities in the world. Under fierce global competition and the recent global financial and economic crisis, the order of the world economy will definitely be affected. Relatively speaking, with the rapid growth of China’s economy in the recent decades and its economic structure, the impact of the global financial crisis to China is smaller. Hong Kong is an open economy which is inevitably affected by external environment. In order to continue to thrive, Hong Kong has to make use of its competitive advantage as an international business city as well as to leverage the benefit of its accessibility to the Mainland China. The government and Hong Kong community should proactively explore the opportunities arising from the Pearl River Delta Development Plan, to proactively encounter and resolve the incompatibility in developments within the region, and to adopt a new regional strategic development thinking and vision. With that, I am sure we can work out collaborations and opportunities which are beneficial to Hong Kong, the Pearl River Delta and to the nation as a whole. It is also in line with the direction of the Foundation’s work.” (Note: The Foundation organised the “Hong Kong Business Community Forum on Pearl River Delta Development Plan” on 27 March 2009.) For enquiries, please contact Ms Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 or email: jimmie_chow@betterhongkong.org. – End –

Mr. David McCormick, Under Secretary of U.S. Treasury Shared His Views on the Recent Financial Turmoil at the Luncheon Organised by the Better Hong Kong Foundation

2008.10.22
Organised by The Better Hong Kong Foundation (the Foundation), Mr. David McCormick, Under Secretary for International Affairs of the U.S. Treasury Department delivered a luncheon speech entitled “Financial Turmoil in Perspective” at the Renaissance Harbour View Hotel in Hong Kong today. More than 300 audiences who are professionals from financial and banking sectors, insurance and properties industries, academic and the government, etc attended the luncheon and exchanged their views with Mr. McCormick on the recent global financial crises and the way forward. After a warm welcome given by the Foundation’s Executive Director Ms. Karen Tang and an introduction by Mr. Ronnie Chan, Chairman of the Executive Committee of the Better Hong Kong Foundation, Chairman of the Asia Society Hong Kong Center and Chairman of Hang Lung Group, Mr. McCormick began his speech by saying that no countries in the world could immune from the recent global financial stress as well as the destabilizing financial markets caused by diminishing market confidence. To address the instability and restore the health of the world economy, Mr. McCormick urged that the whole world must work together to achieve these goals. Mr. McCormick also shared his views on the root cause of the market turmoil, the measurements that the United States are taking to mitigate risk as well as to stabilize the markets, and suggested some possible early lessons for both the United States and China. Four emerging themes have been suggested by Mr. McCormick, namely the reformation of US financial system, development of domestic market, anti-protectionism and the continuation of cooperation among government around the world. Although the interdependence of the global economy has made the current challenges more complex, Mr. McCormick believed that the challenge would be overcame with the joint effort of the leaders around the world. In the Q&A session, most of the audiences asked how the US government could ensure its actions taken in dealing with the current turmoil be an effective one and how the upcoming new US administration will carry that forward. The discussion amongst Mr. McCormick and the audiences was definitely a fruitful and constructive one. It was truly a rewarding experience for the Foundation’s members and for all other audiences. At his introduction, Mr. Ronnie Chan commended the US government that it has been wise in inviting experienced experts from business who really understand the market. Good examples include Mr. David McCormick and Mr. Henry Paulson. Ms. Karen Tang explained that the luncheon has been planned for more than a year and it turned out to be at the perfect timing. She thanks Asia Society for co-organising the event and thanks media partners Economist, South China Morning Post, and Caijing Magazine for supporting the event and making it a success. Amongst the audiences, the Better Hong Kong Foundation members attended include: – Tan Sri Dato’ David Chiu, Deputy Chairman of Far East Consortium International Ltd, – Dr. Roy Chung, Vice Chairman of Techtronic Industries Co Ltd, – Mr. Thomas Woo, Executive Managing Director & General Manager of Hsin Kuang Restaurant (Holdings) Ltd, – Ms. Winnie Ng, Director of the Kowloon Motor Bus Co Ltd, – Dr. Gerald Chow, Executive Director of Chow Sang Sang Holdings International Ltd, – Ms. Judy Yu-Hong, Managing Director of Carsac Ltd, – Mr. Joseph Yu, Chairman of Roseville Group of Companies, and – Mr. Albert Ip, Managing Director of Investment, Pac Rim, Merrill Lynch (Asia Pacific) Ltd. Other guests include: – Mr. Joseph Donovan, U.S. Consul General, Mr. Christopher Marut, U.S. Deputy Consul General, – Mr. Zhan Yongxin, Deputy Commissioner of the Commissioner’s Office of China’s Foreign Ministry in the HKSAR – Dr. Edgar Cheng, Council Chairman of the Chinese University of Hong Kong and Chairman of the World-Wide Investment Co Ltd,  – Prof Lawrence Lau, Vice-Chancellor of the Chinese University of Hong Kong, – Mr. Douglas Woo, Acting Managing Director of Wheelock Properties (Hong Kong) Ltd, – Dr. Gerald Chan, Non-Executive Director of Morningside Group, etc. The Asia Society was the co-organiser of the event. And the media partners included the Economist, the South China Morning Post and Caijing. Speech of Mr. David McCormick and the event photos are now available from the Foundation’s website http://www.betterhongkong.org The video of the luncheon presentation will be available for viewing on the Foundation’s website http://www.betterhongkong.org on 30 October 2008. For enquiries, please contact Ms. Jimmie Chow, Communications Manager of the Foundation at Tel: (852) 2865 3529 or email: jimmie_chow@betterhongkong.org. The Better Hong Kong Foundation was founded in 1995. It is a privately funded non-profit organization, formed by leading Hong Kong business and community leaders to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. As we strive to create an even better Hong Kong for ourselves and our families, we are turning the promise of “One Country Two Systems” and a high degree of autonomy into reality. The Foundation’s mission is to share this sense of confidence in the future of the Special Administrative Region with overseas business and political leaders. Click here for photos of the event. *** Undersecretary for International Affairs David H. McCormick Remarks to the Better Hong Kong Foundation on 22 October 2008  Financial Turmoil and the Global Economy Hong Kong – These are unprecedented and difficult times for the global economy.  The world’s financial market conditions are severely strained, and risks to the global growth are significant.  The largest advanced economies are feeling this most acutely.  In the United States, our financial markets are experiencing unprecedented challenges, and this is adding even greater pressure to our already slowing economy.  These developments are affecting the entire globe.  Emerging market countries in recent years, including those in Asia, have made impressive strides in strengthening their fundamentals, accelerating their economic growth and cushioning themselves against external shocks.  Nevertheless, as the events of the past several weeks have shown, emerging markets like China are not immune from the global financial stress.  Even financial markets with little direct exposure to mortgage-related assets risk becoming destabilized by diminishing market confidence and slowing export growth.  Because we are all affected by this crisis, we must work together to address this instability and restore the health of the world economy.   Over the past two weeks, we have witnessed an unprecedented international response to this financial turmoil.  The Group of Seven industrialized countries have announced and are implementing a coordinated action plan to stabilize financial markets and restore the flow of credit.  Others around the world, from Hong Kong to Denmark, have adopted similar approaches.  Together these countries are taking steps to provide liquidity to markets, strengthen financial institutions, prevent failures that pose systemic risk, protect depositors, and enhance confidence in financial institutions.  While financial markets have responded positively in some ways to these unprecedented efforts, much work remains.    Today, I would like to share my views on how we arrived at this place, what the United States is doing to address the turmoil and suggest some possible early lessons for both the United States and China.   Root Causes of the Market Turmoil How did we get to this point? The story begins with a decade of benign economic conditions marked by low interest rates, low inflation, and less volatile asset markets, leading many to ignore the “risk” half of the risk-reward equation at the heart of financial markets. Investors around the world, who in preceding years had enjoyed above-historical returns on most assets, continued reaching for ever-higher gains.  In response, the financial-services industry created a variety of complicated new financial products to meet this demand, and regulators and investors alike showed a growing complacency toward risk. These factors, blended together, created underlying conditions ripe for instability. The imbalance between risk and reward was most evident in the U.S. housing market, where lenders significantly loosened credit standards, particularly for a new generation of adjustable-rate mortgages.  Last summer, these vulnerabilities in our financial system became clear, as looser credit standards in the housing market combined with an end to rapid home-price appreciation led to a significant rise in delinquent mortgages. This in turn contributed to immediate and unexpected losses for investors and a reconsideration of the risk-reward relationship–first in housing, and soon after, across all asset classes. Shaken investor confidence in housing assets had a domino effect throughout world markets, ratcheting up demand for cash and liquidity, and curtailing the pace of the new lending and investment necessary for continued growth.  Actions to Mitigate Risk and Stabilize Markets Recognizing the risk of the housing downturn to the U.S. economy, the Bush Administration and Congress have taken a number of steps, including a $150 billion stimulus package, to help mitigate the impact on the real economy.  Progress in the financial markets has been uneven, and additional challenges clearly lie ahead.  In formulating a response, we initially acted on a case-by-case basis to address deteriorating financial conditions in a number of financial institutions.  In March, the Federal Reserve took unprecedented action to ensure an orderly resolution for Bear Stearns, and in September, authorities around the world took steps to mitigate the impact of the bankruptcy of Lehman Brothers, America’s fourth largest investment bank.  That same week, the Federal Reserve provided funding to American International Group (AIG) to address the systemic risk that would have resulted from a sudden collapse of the firm.  Several weeks later, the FDIC facilitated JPMorgan Chase’s acquisition of the banking operations of Washington Mutual, one of America’s largest retail banks.  In each of these cases, policymakers attempted to strike a careful balance of promoting market discipline while mitigating systemic risk, holding investors and management teams accountable while protecting blameless consumers from collateral damage. We have sought to achieve a similar balance in the cases of Fannie Mae and Freddie Mac, which are of particular interest to investors around the world, including here in China.  These Government Sponsored Enterprises (GSEs) are the largest sources of mortgage finance in the United States, affecting roughly 70 percent of mortgages originated.  Not surprisingly, the prolonged housing correction weakened their financial condition, and both institutions faced a loss of investor confidence.  Fannie Mae and Freddie Mac are so large and interwoven in our financial system that the failure of either would have far reaching effects on the U.S. and global economies.   This past summer, investors began to express growing concerns over the stability of Fannie and Freddie and the ambiguity over the scope and certainty of government support for these institutions. In response, Secretary Paulson asked Congress for certain authorities regarding Fannie Mae and Freddie Mac in order to help stabilize and support our financial and housing markets. Congressional leaders acted promptly and decisively with the needed legislation.  In the days and weeks that followed, the FHFA, the government regulator responsible for overseeing these institutions – placed both of Fannie and Freddie under temporary government control to allow for needed changes at both institutions. In a complementary step, Treasury established contractual Preferred Stock Purchase Agreements with both institutions, committing up to $100 billion per institution to ensure that each GSE maintains a positive net worth, thereby protecting debt holders. These Preferred Stock Purchase Agreements are intended to address the underlying ambiguities surrounding the GSEs by explicitly demonstrating to the holders of Fannie Mae and Freddie Mac debt that the U.S. government will stand behind and protect their investments.  A Comprehensive Policy Response  Despite the hardening of the government’s support for Fannie Mae and Freddie Mac, and the decisive resolutions of Bear Stearns, Lehman Brothers, AIG, Washington Mutual, and Wachovia, investors have become increasingly concerned over the possibility of other failing financial institutions. This has made them increasingly reluctant to extend credit and has resulted in the further tightening of our credit markets. Sharp increases in the cost of credit for financial and non-financial companies, in the United States and globally, have increased the risk that corporations will be unable to roll over maturing debt.  Given this fragile environment, U.S. authorities decided there was a need to act decisively and comprehensively to stabilize the markets and address the underlying sources of uncertainty.  The four part plan rolled out by earlier this month seeks to achieve these goals. First, central banks from around the world have acted together in recent months to provide additional liquidity for financial institutions. The Federal Reserve has established swap lines with a number of central banks to reduce pressures in global short-term U.S. dollar markets.  Moreover, to further increase access to funding for businesses in all sectors of our economy, the Federal Reserve launched a Commercial Paper Funding Facility (CPFF), which provides a broad backstop for the commercial paper market by funding purchases of commercial paper of three month maturity from high-quality issuers.  Additionally, in early October, Treasury implemented a temporary guaranty program for the U.S. money market mutual fund industry, which had experienced funding problems. This temporary $50 billion guaranty program offers government insurance to address concerns about whether these money market investments are safe and accessible.  Second, we have taken steps to improve market operations and market integrity. For example, the Securities and Exchange Commission took temporary emergency action to prohibit short selling in financial companies to protect the integrity and quality of the securities market and strengthen investor confidence. The SEC’s exceptional actions were joined by regulators in the UK, France, Germany, and other countries who also imposed restrictions on short selling.  In addition, the SEC is aggressively pursuing enforcement action against market manipulation that may have occurred in previous months. Third, with the support of Treasury and the Federal Reserve, the FDIC has temporarily guaranteed the senior debt of all FDIC insured institutions and their holding companies, as well as deposits in non-interest bearing deposit transaction accounts.  These actions are specifically designed to unlock interbank lending by mitigating counterparty risk.  Regulators will implement an enhanced supervisory framework to assure appropriate use of this new guarantee.  This important action, combined with the increase in the FDIC’s deposit insurance from $100,000 to $250,000, will provide confidence in the banking system and avert destabilizing capital flows between banks in the United States. Finally, and perhaps most important, Treasury is acting to provide much-needed capital to address one of the root causes of the current stress in our financial system – the ongoing housing correction and the consequent buildup of illiquid mortgage-related assets. These troubled assets remain frozen on the balance sheets of banks and other financial institutions, constraining the flow of credit that is so vitally important to our economic growth. The failure to address this would mean that every aspect of our financial and funding markets, ranging from consumer credit to money market funds, would remain impaired. On October 3, Congress passed and President Bush signed into law the bipartisan Emergency Economic Stabilization Act of 2008.  The law gives the Treasury Secretary broad and flexible authority to purchase and insure mortgage assets, as well as equity securities, as needed to stabilize our financial markets.  The law empowers Treasury to design and deploy numerous tools to fill the capital hole created by illiquid troubled assets.  As part of a carefully defined capital injection plan, nine major financial institutions, which comprise more than 50 percent of all U.S. deposits and assets, have already agreed to participate and will receive a combined $125 billion of capital and will grant the U.S. government minority stakes in return.  These healthy institutions are taking these steps to strengthen their own positions and to enhance the overall performance of the U.S. economy.  By participating in this program, these banks, along with others that will be identified in the future, will have enhanced capacity to perform their vital function of lending to U.S. consumers and businesses and promoting economic growth.  These nine banks have also committed to continued aggressive actions to prevent unnecessary foreclosures and preserve homeownership.  We are also developing plans to add additional capital to reduce market uncertainty and encourage private investors by purchasing mortgage backed securities and whole loans off the balance sheets of U.S.-based financial institutions. Together, these four steps significantly strengthen the capital positions and funding ability of U.S. financial institutions, enabling them to perform their role of underpinning overall economic growth. These actions demonstrate to market participants around the world that the United States is committed to taking all necessary steps to unlock our credit markets, minimize the impact of the current instability on the U.S. economy, and restore the health of the global financial system. Much of this action is being coordinated internationally.  The steps being undertaken in the United States are consistent with the efforts undertaken around the globe by others to provide liquidity, strengthen financial institutions, prevent failures that pose systemic risk, protect savers, and enforce investor protections.  We welcome the policy decisions announced by European countries, Japan, Australia, and other nations around the world to stabilize their markets and ensure the health of their institutions.  Lessons for the Future Since we are very much in the eye of the storm, it is difficult and premature to draw definitive lessons.  Let me suggest four emerging themes that may be worth considering.  First, we have undoubtedly learned that our own financial system is in need of reform.  To help rebuild the strength and confidence in our markets, the United States has worked to implement the findings of international experts in the Financial Stability Forum (FSF) and U.S. experts in the President’s Working Group on Financial Markets (PWG).  These bodies concluded that we must increase transparency, prudential regulation, risk management, and market discipline.  Additional reforms of our regulations, regulatory structure, and international institutions will most certainly follow.  The Financial Stability Forum recommendations are applicable to the financial markets around the world, and my country is committed to implementing them in full.  China can and should benefit from the lessons the United States and other countries have learned from the challenges in our financial markets, and we are happy to share them.  It would be unfortunate if, as a result of this turmoil, policymakers in China mistakenly abandon their pursuit of financial sector innovation that has been so important to supporting China’s growth in productivity and macroeconomic stability. Second, it is clear that the current turmoil has exacerbated macroeconomic policy challenges the United States and China already faced as a result of structural imbalances in both economies.  For the United States, this has made efficient management of fiscal policy an even more critical challenge.  China’s extraordinary growth has relied on exports and investment to fuel the economy, but this strategy may no longer be tenable in the face of a global economic slowdown.  As China’s leaders recognize, their current growth model has created growing internal and external imbalances that need to be addressed.  Strong domestic demand growth – with robust contributions from consumption and the services sector – provides the surest guarantee of both macroeconomic stability and sustained economic growth in the face of negative external shocks.  Achieving strong demand-led growth is no small policy challenge.  However, market-based pricing, including for interest rates and exchange rates, must play a central role in the process of allocating resources towards production for the domestic market.  Third, we have learned that our growth and prosperity is more dependent on one another than at any time in our respective histories.  Openness to international trade and investment has been and will continue to be the linchpin of economic growth for the global economy.  Policy makers around the world must therefore remain vigilant to guard against the inevitable short-sighted appeals for protectionism during this period of global financial stress.  A central task for policymakers in both the United States and Asia is to embrace the aggregate benefits of openness to trade and investment while taking measures to ensure that opportunities to benefit from that openness are widely shared. Finally, the recent crisis has highlighted the importance of continued cooperation among major economies through such fora as the G-20, the Financial Stability Forum, and the International Monetary Fund.  As recent developments have demonstrated, the market turmoil is a global event. Governments around the world have taken actions to address financial market developments, and international cooperation and coordination has been robust.  It is critical for governments to continue to take individual and collective actions to provide much-needed liquidity, strengthen financial institutions, enhance market stability, and develop a comprehensive regulatory response. We must closely coordinate our efforts within a common framework so that the action of one country does not come at the expense of others or the stability of the system as a whole.  Conclusion Ladies and gentlemen, the interdependence of our global economy makes our current challenges more complex.  It also makes our work with international counterparts to promote growth and financial stability all the more important.  We should take faith from the fact that leaders in America and around the world are rising to this pressing challenge.  In the United States we have faced and overcome enormous economic challenges like this before.  From this crisis, too, I’m confident we will emerge stronger and wiser. 

The Better Hong Kong Foundation Accomplished Its Delegation to the United States In 2008

2008.07.03
The Better Hong Kong Foundation (“the Foundation”) sent its annual delegation to the United States from 15th to 21st June this year. A press conference was held today to brief members of the media about the main issues dealt with during their stay in the U.S.. Members of the delegation also shared their observation and experience gained from the trip. This year’s delegation was led by the Foundation’s Executive Director Miss Karen TANG,  included members: Mr. Daniel R. FUNG, Vice-Chairman of the Salzburg Global Seminar, Board of Governors of the East-West Center, National Delegate of the Chinese People’s Political Consultative Conference (CPPCC), Chairman of the Broadcasting Authority, Senior Counsel of the Hong Kong Bar, Solicitor-General of Hong Kong (1994-98); Mr. James E. THOMPSON, GBS, the Founder and Chairman of the Crown Worldwide Group and former Chairman of the American Chamber of Commerce in Hong Kong for 2002 and 2003; and the Foundation’s Council members Ms. Winnie NG, Executive Director of the Kowloon Motor Bus Co. Ltd; Dr. Gerald CHOW, Executive Director of Chow Sang Sang Holdings International Ltd and Mr. Joseph YU, Chairman of the Roseville Group of Companies. This annual mission to US took place before the U.S. Presidential Election. Irrespective of whichever candidate succeeds in November, the policies of the incoming President Elect will herald material departures from the present incumbent. With that in mind, the Foundation visited New York and Washington D.C. and took the temperature of all the major players in both metropolises and exchanged views with them. The delegation visited the Executive Branch (including: the U.S. State Department and U.S. Department of Commerce); the Legislative Branch (Congressmen and staffers including those of Senator Obama); think tanks inside the Beltway (the Brookings Institution, Center for Strategic & International Studies, Carnegie Endowment for International Peace, The CATO Institute, Heritage Foundation, East-West Center, US-Asia Institute, etc); think tanks in New York City (including National Committee on US-China Relations and Asia Society); professional bodies (American Bar Association); financial institutions (Morgan Stanley); rating agencies (Standard & Poor’s) and media representatives.  During the mission, the delegation also attended dinner hosted by the US Chamber of Commerce in Washington D.C. for the Chinese delegation of the Strategic Economic Dialogue led by the Vice Premier Wang Qishan; and participated in the public talks and luncheons hosted by the Hong Kong Association of New York; by American Bar Association; by the Fund for American Studies and Asia Institute for Political Economy, where Mr. Daniel R. FUNG and Mr. James E. THOMPSON gave speeches. The delegation was also invited to the lunches and dinner hosted by the Consulate General of the People’s Republic of China based in New York, by the Chinese Embassy to the US, and by the Permanent Mission of the PRC to the UN. Miss Karen TANG said at the conference that the theme of this year’s trip was “ Hong Kong : an ideal place to live and to invest”. “We meant to share the strategic position and value of Hong Kong to China and to the region, especially with its well established core value and system and its proximity to the Mainland. Hong Kong has been ranked as the world’s freest economy. It is a vibrant international city with low tax rate, sound international legal system and practices, free flow of capital and information; and accessibility to the Mainland China market, which retains and attracts talents and funds to stay and to come. Hong Kong ‘s education system with global perspectives and international exposure is also highly valued” explained Miss Tang. Mr. Daniel FUNG commented that “The upshot of our full and frank discussions over five days is that the United States have no burning issues with regard to Hong Kong and acknowledge that our governance, economy and rule of law after reversion to Chinese sovereignty have all been a remarkable success, although they will look with interest at our democratic development after 2017. As for China, the United States recognize that Sino-US relations constitute the single more important strategic bilateral relationship in the world of the 21st Century. The conclusion reached by consensus with our interlocutors at the end of our weeklong mission is that, despite challenges in many areas including trade, currency, the environment, security including energy security, human rights, IPR protection, democracy and the rule of law, Sino-US relations will not merely remain stable but will continue to deepen, including deepening into strategic cooperation (including energy security and green tech), and the incoming US President Elect will likely govern from the center.” Mr. James THOMPSON shared that “I felt that our dialogue with numerous influential people in New York and Washington helped us relay the importance of Hong Kong’s position in the relationship between China and the United States. I came away from our trip with strong feelings that there is a keen understanding among America’s most influential ‘movers and shakers’ that the world is focusing on China as we enter the Asian Century. Regardless of the outcome of the U.S. presidential election, I have confidence that trade and political relations with the United States will remain strong.”  Mr. Joseph YU, a newly joined Council Member, told us that he was glad to participate in this meaningful trip. He looked forward to more dialogues like this in the future.  The other two Foundation’s members could not attend today’s press conference. However, Ms. Winnie NG, who has participated in the Foundation’s delegation to the U.S for three times, believed that “the Beijing Olympics marks a watershed in the development of China and an opportunity to further boost the international stature of Hong Kong”. And Dr. Gerald CHOW further explained that “ China ‘s rise has always been complex and evolving. As it promotes an export based economy while maintaining domestic stability in today’s flattened world, it is often faced with many daunting challenges. U.S.-Sino relations, in particular, have never before been in a delicate balance with strong nationalistic sentiment on both sides. With the coming U.S. election and perhaps, a more engaging foreign policy towards China with the new administration, this relationship can grow ever stronger through Hong Kong ‘s role in working as a bridge between these two great nations. That Hong Kong will continue to maintain a special place in the future of China is without question; but it is perhaps more compelling to imagine the possibilities of Hong Kong’s role in a world where China ‘s influence has never been greater.” Miss Tang thanked the delegates and all the organizations visited for their support in making the delegation a tremendous success. The Foundation would continue its dedication in enhancing greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. The Foundation would endeavour to organize this kind of visits for more exchanges and to promote better understanding to each other. Click here for itinerary details, photos and bios of delegates.   For enquires, please contact the Project Officer Miss Fifi YU at (852) 2865 3529 or email: fifi_yu@betterhongkong.org The Better Hong Kong Foundation was founded in 1995. It is a privately funded non-profit organization, formed by leading Hong Kong business and community leaders to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. As we strive to create an even better Hong Kong for ourselves and our families, we are turning the promise of “One Country Two Systems” and a high degree of autonomy into reality. The Foundation’s mission is to share this sense of confidence in the future of the Special Administrative Region with overseas business and political leaders.  

The Better Hong Kong Foundation Organizes High-Level Delegation to the United States From 15 to 21 June, 2008 To New York and Washington D.C.

2008.06.13
The Better Hong Kong Foundation “the Foundation” will organize its annual delegation to the United States from 15th to 21st June this year. The delegation will visit influential leaders from government, Congress, academia, business, media, think tanks and NGOs in New York and Washington D.C., to update them about Hong Kong’s recent development and economic outlook. Ms. Karen TANG will be the leader of this delegation and the delegates include: Mr. Daniel R. FUNG, Vice-Chairman of the Salzburg Global Seminar, Board of Governors of the East-West Center, National Delegate of the Chinese People’s Political Consultative Conference (CPPCC), Chairman of the Broadcasting Authority, Senior Counsel of the Hong Kong Bar, Solicitor-General of Hong Kong (1994-98); Mr. James E. THOMPSON, GBS, the Founder and Chairman of the Crown Worldwide Group and former Chairman of the American Chamber of Commerce in Hong Kong for 2002 and 2003; and the Foundation’s Council Member Ms. Winnie NG, Executive Director of the Kowloon Motor Bus Co. Ltd; and Dr. Gerald CHOW, Executive Director of Chow Sang Sang Holdings International Ltd. Ms. Karen TANG said that “Hong Kong has been ranked as the world’s freest economy. It is a vibrant international city with low tax rate, sound international legal system and practices, free flow of capital and information; and accessibility to the Mainland China market, which retains and attracts talents and funds to stay and to come. I hope that we can share our experience and belief with the opinion leaders and decision makers in the States during our visit”. Mr. Daniel FUNG is invited as one of the guests of the delegation. His rich legal experience and knowledge in constitution; and his long time participation in China and international affairs will definitely benefit the U.S. influential political and economic leaders to better understand Hong Kong’s advantage in rule of law and its strategic role in the China and international scene. Mr. FUNG hopes that this delegation can help “to promote a better understanding of the strategic role played by Hong Kong in enriching the multi-dimensional Sino-US dialogue and engagement and enhancing Sino-US relations in general in advance of the November Presidential Election”. Mr. James E. THOMPSON has invested and lived in Hong Kong for almost thirty years. His confidence, dedication and contribution to Hong Kong can best demonstrate his belief in the theme of the delegation this year “Hong Kong: an ideal place to live and to invest”. Mr. THOMPSON said that “I look forward to exchanging ideas with my fellow Americans and most importantly, providing them with some details as to why I view Hong Kong as the most dynamic city in Asia and explain the positive impact Hong Kong has on China.”         This will be the third time that Ms. Winnie NG participates in the Foundation’s delegation to the U.S.. She believes that “the Beijing Olympics marks a watershed in the development of China and an opportunity to further boost the international stature of Hong Kong”. Dr. Gerald CHOW, who has just completed a master degree course from the Harvard University, will take part in the delegation as well. The delegation will attend the dinner hosted in Washington D.C. for the Chinese delegation of the Strategic Economic Dialogue led by the Vice Premier Wang Qi Shan; and will participate in the public talks and luncheons hosted by the Hong Kong Association of New York; American Bar Association; the Fund for American Studies and Asia Institute for Political Economy, where Mr. Daniel R. FUNG and Mr. James E. THOMPSON are invited to speak. The delegation will meet with think tanks such as the Heritage Foundation, the Carnegie Endowment for International Peace; with U.S. government officials in charge of economic and Asia policy; and with the campaign teams for the 2008 US presidential election. The delegation will also attend luncheons and dinner hosted by the Consulate General of the People’s Republic of China based in New York, by the Chinese Embassy to the US, and by the Permanent Mission of the PRC to the UN. Ms. TANG expressed her gratitude to the delegates for their support and promised to share the with the media the delegation’s result after the trip. Click here for the draft itinerary of the delegation and bios of delegates. For more details or enquires, please contact the Foundation’s Project Officer Miss YU Feifei at (852) 2865 3529 or email to: fifi_yu@betterhongkong.org

2008 China Urban Competitiveness Study (Hong Kong)

2008.04.01
Organizer: The Better Hong Kong Foundation Co-organizers: Institute of Finance and Trade Economics, Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong The Seminar and Press Conference of 2008 China Urban Competitiveness Study (Hong Kong) is held in Hong Kong on April 1, 2008. It is organized by The Better Hong Kong Foundation and co-organized by Institute of Finance and Trade Economics, Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. “The 2008 Blue Book on China Urban Competitiveness” project is led by Dr Pengfei Ni in the Chinese Academy of Social Sciences. The urban competitiveness of 200 cities in mainland China, Taiwan, Hong Kong and Macau is analyzed. 1. Urban Competitiveness Ranking The top 10 cities in overall urban competitiveness are: Hong Kong, Shenzhen, Shanghai, Beijing, Taipei, Guangzhou, Kaohsiung, Suzhou, Hangzhou and Tianjin. Hong Kong also ranked 1st in 2006 and 2007. Hong Kong also ranked 1st in efficiency competitiveness, structural competitiveness and quality competitiveness. Hong Kong ranked 2nd in scale competitiveness after Shanghai. Hong Kong ranked 7th in efficacy competitiveness but still ahead of Shanghai and Shenzhen. Comparing with rapidly growing cities in the mainland, Hong Kong ranked 195th in growth competitiveness. 2. Hong Kong versus Shanhai in Urban Competitiveness Hong Kong and Shanghai rank 1st and 2nd in explanatory urban competitiveness. Among eight sub-indicators, Hong Kong ranks 1st in four sub-indicators, 2nd in three sub-indicators and 4th in one sub-indicator. Shanghai also ranks 1st in two sub-indicators, 2nd in three sub-indicators and 3rd or 4th in three sub-indicators. Hong Kong performs better than Shanghai in competitiveness of public sector, living quality, social environment, human resources, industries and business environment. But Shanghai leads Hong Kong in competitiveness of innovation environment and firms. Both cities are strong in competitiveness of human resources, industries, business environment and innovation environment. The two cities have many opportunities for cooperation. For examples, Hong Kong can attract more talents from Mainland. Shanghai also has many good companies and Hong Kong has excellent financial markets. The cooperation of financial services between the two cities will benefit both cities and the economic development of China. 3. Urban Cluster Ranking Among 33 urban clusters in China,Yangtze River Delta (YRD) urban cluster ranks 1st in comprehensive urban competitiveness. Its endowment competitiveness and growth competitiveness also rank 1st while current competitiveness ranks 2nd. In current competitiveness, YRD urban cluster is driven by foreign investment, traditional manufacturing and specialized local industrial clusters. Shanghai functions as an international city, Nanjing and Hangzhou as central cities providing producer services, Suzhou, Wuxi, Changzhou and Ningbo focusing on advanced manufacturing. But the spatial division of labour in the urban cluster is still not adequate. The YRD urban cluster is forming a global manufacturing region ranking 1st in GDP, import and export and urban primacy in 2007. Pearl River Delta (PRD) urban cluster ranks 2nd in comprehensive urban competitiveness. Its current competitiveness ranks 1st while endowment competitiveness ranks 2nd and growth competitiveness ranks 3rd. In current competitiveness, PRD urban cluster is outstanding in per capita indicators, ranking 1st in GDP per capita and fiscal income per capita. The scale of import and export ranks 2nd after YRD urban cluster. In future, the PRD should re-position in the global system and promote division of labour among cities in PRD for mutual benefit. PRD should develop into a top metropolitan region in the world. Hong Kong will be the dragon-head and the primary centre of this metropolitan region mainly developing advanced service industries such as financial and logistics industries. Hong Kong and Shenzhen are twin cities. Shenzhen will be the world-class science and technology centre mainly developing high-technology. Guangzhou will be the secondary centre of this metropolitan region developing advanced manufacturing and medium level service industries. Dongguan, Foshan, Zhongshan, Macau and Zhuhai will be bases of modern manufacturing and services industries. 4. Remarks on the Result of Urban Competitiveness Study Prof. Yue-man Yeung and Prof. Jianfa Shen from Hong Kong Institute of Asia-Pacific Studies/Dept of Geography and Resource Management, The Chinese University of Hong Kong commented on the result of urban competitiveness study on the press conference. Prof. Yeung pointed out that the 2008 report has two breakthroughs. First, 33 urban clusters are compared including YRD, PRD, Beijing-Tianjin-Tangshan, Shandong Peninsula, central and south Liaoning, West Strait and west Taiwan urban clusters. Second, 26 city pairs are compared in urban competitiveness. Familiar city pairs include Shanghai/Hong Kong, Hangzhou/Ningbo and Shenzhen/Guangzhou. The basic condition, difference, similarity and urban competition strategies are compared for each city pair. A city’s strength and weakness are revealed using tables and graphs. As China’s urbanization advances 1% a year, the report provides theoretical and empirical evidences to the formation of development policies of China. Prof. Shen commented that Hong Kong is strong in many domains of urban competitiveness. But Shanghai is catching up Hong Kong quickly. The comprehensive competitiveness of YRD urban cluster already overtook PRD urban cluster. There is need to enhance and consolidate the cooperation between Hong Kong and PRD cities. Hong Kong-Shenzhen cooperation plays an important role. The results of 2008 public opinion survey of research project “Inter-city Competition and Cooperation between Hong Kong and Shenzhen in the 11th Five-year Plan Period” revealed that 69.8% of respondents support the development of Hong Kong-Shenzhen metropolis. A consensus on developing Hong Kong-Shenzhen metropolis is emerging. 73.7% of the respondents agree that government should increase investment in cross-boundary infrastructure. Close to half of the respondents agree that Shenzhen residents should be allowed to study, travel and do business in Hong Kong more easily, and Shenzhen residents with tertiary education should be allowed to work in Hong Kong. Concluding the press conference, Ms Karen Tang, Executive Director of Better Hong Kong Foundation commented that “Hong Kong is ranked top among all cities in China in three consecutive years indicating strong competitiveness of Hong Kong. However to maintain its competitiveness Hong Kong has to work with other cities in PRD, to achieve further developments for the whole region. To strengthen urban competitiveness, Hong Kong should also strengthen infrastructure in transportation, communication, and industrial and commercial sectors, expand the scope of financial services to consolidate Hong Kong’s role as the financial centre of Asia.” For more details of the report, please visit: http://www.betterhongkong.org/media.php?lang=EN&maincat=2&year=2008 Click here for photos of the event. For enquiries, please contact Miss Karen Tang of The Better Hong Kong Foundation, Tel: (852) 2865 2320.

The Better Hong Kong Foundation Accomplished High-Level Delegation to the United States

2007.07.03
The Better Hong Kong Foundation (“the Foundation”) sent its annual delegation to the United States from 17th to 24th June this year. The delegation paid visits to important leaders from the US government, Congress, academia, business, media, think tanks and related NGOs in Washington D.C. and New York, to update them about Hong Kong’s recent development and economic outlook. A press conference was held today to brief members of the media about the people and organizations that the delegation has met during their stay in US; members of the delegation also shared their experience gained from this delegation. This year’s delegation was led by The Foundation’s Executive Director Miss Karen Tang,  included members: The Hon. CY Leung, Convenor of the Executive Council of HKSAR, and Chairman, Asia Pacific, DTZ; The Hon. Bernard Chan, Member of the Executive Council and the Legislative Council, and President, Asia Financial Holdings Ltd.; Prof. Stephen YL Cheung, Professor (Chair) of Finance, Department of Economics and Finance, Faculty of Business, City University of Hong Kong; Miss Winnie Ng, the Foundation’s Council Member, and Executive Director of Kowloon Motor Bus Co. Ltd; and Mr. Al. Reyes, Commentator on International Affairs. Mr. Chris Yeung, Editor-at-Large of the South China Morning Post was an observer of the delegation. Miss Tang explained at the conference that this year being the 10th anniversary of Hong Kong returning to China, the Foundation has set the theme of this year’s delegation as “Hong Kong in the Past Ten Years and the Road Ahead”. “We have reviewed Hong Kong’s positioning during its integration with Mainland China under the principle of “one country, two systems; Hong Kong people ruling Hong Kong; and high degree of autonomy”; its uniqueness as a cosmopolitan city and gateway to the world; and describe the challenges and opportunities that it faces”, said Miss Tang During the mission, The Hon. CY Leung, The Hon. Bernard Chan and Prof. Cheung spoke at public talks and luncheons hosted by Carnegie Endowment for International Peace, Brookings Institutions, the Fund for American Studies, HKSAR Government’s Economic and Trade Office in New York, and the Asia Society. The delegation also met with Government officials including Dr. Daniel B. Wright, Managing Director, US – China Strategic Economic Dialogue (SED); and The Honourable Thomas J. Christensen, Deputy Assistant Secretary of State for East Asian and Pacific Affairs. The Foundation has a long history working with influential think tanks in the US. Therefore, the delegation also met with Cato Institute; Carnegie Endowment for International Peace, Brookings Institute, Heritage Foundation etc, to exchange views on Hong Kong’s development since its return to China. Apart from meetings with US Government officials and NGOs, the delegation was hosted lunch and dinners by the Minister and Deputy Chief of Mission of the Embassy of the People’s Republic of China in the United States of America, Chinese Consul General based in New York and the  Ambassador Extraordinary and Plenipotentiary Permanent Representative of the PRC to the United Nations.(For itinerary details, please visit the Foundation’s website: www.betterhongkong.org) To enhance the US media’s understanding about the latest development of Hong Kong and China, the delegation met with different media, including Forbes and Fortune magazine. Ms. Sheridan Prasso, reporter of Fortune magazine, was among them on the Welcoming Reception hosted by the Overseas Press Club in New York. Before Hong Kong’s return to China, the Fortune magazine published a cover story “The Death of Hong Kong”. And Miss Prasso wrote on the latest issue an article “Oops! Hong Kong is hardly dead”, acknowledged that the magazine (Fortune) had made a wrong judgment. (For full text of the article, please click:http://money.cnn.com/magazines/fortune/fortune_archive/2007/07/09/100122332/index.htm?postversion=2007062816 ) The Hon. CY Leung, The Hon Bernard Chan and Prof. Stephen Cheung mentioned on the press conference that itinerary of the delegation was packed yet well-knitted. They were able to meet with many influential Government officials, think tanks, NGOs, Congressmen and media in the States. The Hon. Leung said that, theme of his speeches was successful implementation of “One Country, Two Systems” in Hong Kong, which was generally endorsed by the attendees. The attendees also agreed that Hong Kong has enjoyed the high degree of autonomy under the Basic Law without interference from Mainland China. At the same time, China’s booming economy has helped Hong Kong strengthen its international competitiveness. There were repeated expressions of “astonishing” by attendees to describe the encouraging developments of Hong Kong in the past ten years. The Hon Leung also highlighted the need for Hong Kong to study its proactive role in the financial and economic aspects in the Sino-US Strategic Economic Dialogue. (Full text of Mr. Leung’s speech is available at The Foundation’s website) The Hon. Chan expressed that ten years ago, people in Hong Kong and outside Hong Kong foresaw a series of problems to be happened after Hong Kong’s return to China. However, it turned out that these problems did not happen. On the contrary, other unanticipated problems sprang from the close and frequent contact between Hong Kong and China, such as marriage between the couples of Hong Kong and the Mainland, and the heavy traffic at the borders, warrant more attention from the society. These reflected the bilateral influence on each other during the process of integration between Hong Kong and China. Talking about the economy, Professor Cheung said that many of the attendees were interested in the economic cooperation between Hong Kong and the Mainland, and how this could bring to Hong Kong opportunities and challenges. Professor Cheung quoted cases of the issuance of RMB bonds in Hong Kong and the IPOs of companies from Mainland China in Hong Kong, to illustrate Hong Kong’s strategic two-way role in helping the Mainland China’s companies enter the international market, and the international enterprises to invest in China. This was the second time Miss Winnie Ng joined the Foundation’s delegation. Miss Ng regarded that the US experts on Hong Kong and China affairs had an understanding on related issues. However, continuous and timely communications were especially important in a rapidly developing society. The Foundation would continue to support this kind of meaningful events, said Miss Ng. Miss Tang thanked the delegates and all the organizations visited for their support in making the delegation a tremendous success. The Foundation would continue its dedication in enhancing greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. The Foundation would endeavour to organize this kind of visits for more exchanges and to promote better understanding to each other. 3 July 2007 -End- For itinerary details, photos, speeches and bios of delegates, please visit the Foundation’s website: www.betterhongkong.org For enquires, please contact the Communications Manager Miss Alice Mak at (852) 2865 2529; or (852) 6030 6025; or email: alice_mak@betterhongkong.org

Press preview and opening ceremony of Postal Items exhibition

2007.07.03
The opening ceremony of the exhibition, “Postal Items Exhibition on Hong Kong’s Return to the Motherland and China’s Diplomacy”, will be held at 4:50pm, on Thursday (July 5) at the Hong Kong Heritage Discovery Centre, Kowloon Park, Haiphong Road, Tsim Sha Tsui,.      A press preview of the exhibition will be organized at 3.30pm. The Secretary – General, Philatelic Association of the Ministry of Foreign Affairs of the People’s Republic of China, Mr Ma Xiaoling, will brief media representatives the contents of the exhibition.      The Commissioner of the Ministry of Foreign Affairs of the People’s Republic of China in the HKSAR, Mr Lü Xinhua; The Secretary for Home Affairs, Mr Tsang Tak-sing Executive Director of the Better Hong Kong Foundation, Miss Karen Tang Shuk-tak; Chief Archivist, the Bureau of Archives of the Ministry of Foreign Affairs of the People’s Republic of China, Mr Guo Chongli; Chairman, Staff Union of the Ministry of Foreign Affairs of the People’s Republic of China, Mr Sun Qishun; Director of Leisure and Cultural Services (LCSD), Mr Thomas Chow; and Postmaster General, Mr Tam Wing-pong will officiate at the opening ceremony.      Coverage is invited.      July 1, 1997 is a historic day marking Hong Kong’s return to China. It is a memorable day to Hong Kong and China. To celebrate the 10th Anniversary of Hong Kong’s return to China, the Office of the Commissioner of the Ministry of Foreign Affairs of the People’s Republic of China in the Hong Kong Special Administrative Region, the LCSD and the Better Hong Kong Foundation jointly present this exhibition to display various postal items on Hong Kong’s return to China and China’s diplomacy. The valuable exhibits include commemorative postal items on Hong Kong’s return to China, congratulatory letters and telegrams from various countries sent in 1997, special first day covers of diplomatic series of China, commemorative covers for the 600th anniversary of Zheng He’s Voyages to the West, as well as postal items for the Forum on China-Africa Cooperation.      These invaluable postal items are not only witness to the historic moment of Hong Kong’s return to China, but also testimony to the friendly relations between China and countries all over the world. The exhibition will run at the Heritage Discovery Centre from July 6 to August 5. For enquiries and details, please call at: 2208-4400 or visit the website: http://www.amo.gov.hk. The Commissioner of the Ministry of Foreign Affairs of the People’s Republic of China in the HKSARThe Leisure and Cultural Services DepartmentThe Better Hong Kong Foundation Tuesday, July 3, 2007

The First Ten Years of the Hong Kong SAR: An American Perspective

2007.06.13
This year is the 10th anniversary of HK returning to China. The Better Hong Kong Foundation (Foundation) is pleased to have invited Mr. James B. Cunningham, U.S. Consul General of Hong Kong and Macau to speak at a luncheon co-hosted with the Hong Kong America Centre today. The title of Mr. Cunningham’s speech is ”The First Ten Years of the Hong Kong SAR: An American Perspective”. Members of the Foundation Tan Sri Dato’ David Chiu, Deputy Chairman, Far East Consortium International Ltd.; Mr. Peter Lam, Chairman, Lai Sun Development Co. Ltd.; Ms. Winnie Ng, Executive Director, The Kowloon Motor Bus Co. Ltd.; Dr. Gerald K. Chow, Executive Director, Chow Sang Sang Holdings International Ltd.; Dato’ Wong Sin Just, Vice Chairman / CEO, Softbank Investment International (Strategic) Ltd.   In his speech, Mr. Cunningham thanked the Foundation for inviting him to share an American perspective on Hong Kong after ten years as a Special Administrative Region of China. Mr. Cunningham stated that the Foundation was created in 1995 by a group of Hong Kong’s influential business and community leaders for the express purpose of enhancing public confidence in Hong Kong’s future. In June of 1995, Fortune magazine ran its cover story: “The Death of Hong Kong.” It was in that business- and investment-unfriendly climate that the Foundation was created to help restore confidence in the territory. HK’s development in the past ten years has proven that the Foundation is on the right track. He also commended the Foundation for contributing to prosper a close relationship between the United States and Hong Kong & China.   The full version of the speech can be downloaded from the US Consulate General’s website: http://hongkong.usconsulate.gov   For more details or enquires please contact the Foundation’s Communications Manager Miss Alice Mak at (852) 2865 2529 or email: alice_mak@betterhongkong.org or visit the Foundation’s website www.betterhongkong.org  

The Better Hong Kong Foundation Organizes High-Level Delegation to the United States

2007.06.12
The Better Hong Kong Foundation “the Foundation” will organize its annual delegation to the United States during 17th to 24th June this year. The delegation will visit important leaders from government, Congress, academia, business, media, think tanks and related NGOs in Washington D.C. and New York, to update them about Hong Kong’s recent development and economic outlook. A press conference was held today to brief members of the media about the theme and members of the delegation.   Miss Karen Tang will be the leader of this delegation and the delegates include: Hon. CY Leung, Convenor of the Executive Council of HKSAR, and Chairman, Asia Pacific, DTZ; Hon. Bernard Chan, Member of the Executive Council and the Legislative Council, and President, Asia Financial Holdings Ltd.; Prof. Stephen YL Cheung, Professor (Chair) of Finance, Department of Economics and Finance, Faculty of Business, City University of Hong Kong; Miss Winnie Ng, the Foundation’s Council Member, and Executive Director of Kowloon Motor Bus Co. Ltd; and Mr. Al. Reyes, Commentator on International Affairs.   Miss Tang explained on the conference that this year is the 10th anniversary of Hong Kong returning to China. Hence the Foundation has made the theme of this year’s delegation “Hong Kong in the Past Ten Years and the Road Ahead”. “We will review Hong Kong’s positioning during its integration with Mainland China, its uniqueness as a cosmopolitan city and gateway to the world; and describe the challenges and opportunities that it faces under the principle of one country two systems”, said Miss Tang   During the mission, Hon. CY Leung, Hon. Bernard Chan and Prof. Cheung will speak at public talks or luncheons hosted by Carnegie Endowment for International Peace, Brookings Institutions, the Fund for American Studies, HKSAR Government’s Economic and Trade Office in New York, and the Asia Society.   The delegation will also meet with Cato Institute; Carnegie Endowment for International Peace; State Department, East Asian and Pacific Affairs; Commerce Department of U.S.; American Enterprise Institute; Institute for Foreign Policy Analysis; and members of the local media, etc.   Apart from meetings with US Government officials and NGOs, the delegation will also attend luncheons or dinners hosted by the Embassy of the People’s Republic of China in the United States of America, Chinese Consulate General based in New York and Chinese Ambassador to UN.  Hon. CY Leung, Hon Bernard Chan and Prof. Cheung stated on the conference that their speeches will focus on HK’s economic developments and economic relations with Mainland China. They will also analyze how HK makes use of its unique relations with China to maintain its competitiveness and status as a Regional financial hub and business centre.   Miss Tang expected that the delegation will come back with fruitful results, which will be announced at a later stage.     -End-   Itinerary of delegation and bios of delegates can be downloaded from the BHKF website: www.betterhongkong.org   For more details or enquires please contact the Foundation’s Communications Manager Miss Alice Mak at (852) 2865 2529 or email: alice_mak@betterhongkong.org

Seminar and Press Conference of 2007 China Urban Competitiveness Study (Hong Kong)

2007.03.28
Organizer: The Better Hong Kong Foundation   Co-organizers: Institute of Finance and Trade Economics, Chinese Academy of Social Sciences Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong The Seminar and Press Conference of 2007 China Urban Competitiveness Study (Hong Kong) is held in Hong Kong on March 28, 2007. It is organized by The Better Hong Kong Foundation and co-organized by Institute of Finance and Trade Economics, Chinese Academy of Social Sciences and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong. 1. Main findings of 2007 China Urban Competitiveness Study “The 2007 Blue Book on China Urban Competitiveness” was led by Dr Ni Pengfei of the Chinese Academy of Social Sciences with contributions from about 100 scholars from Mainland China, Taiwan, Hong Kong and Macau. The report identified the core advantages of 200 Chinese cities. Their urban competitiveness is ranked according to various indicators. A. Ranking of Urban Competitiveness The top 10 cities in overall urban competitiveness are: Hong Kong, Shenzhen, Shanghai, Beijing, Guangzhou, Taipei, Wuxi, Suzhou, Foshan and Macau. Hong Kong’s rank in different competitiveness in 2006 and 2007: Scale competitiveness:                 1st in 2007, 1st in 2006; Efficiency competitiveness:         1st in 2007, 1st in 2006; Efficacy Competitiveness:           1st in 2007; 10th in 2006 Structural competitiveness: 3rd in 2007; 2nd in 2006 Quality Competitiveness:             1st in 2007; 2nd in 2006 Hong Kong ranked the 3rd in structural competitiveness after Shanghai and Shenzhen. Comparing with rapidly growing cities in the mainland, Hong Kong was almost at the bottom of 200 cities in growth competitiveness, ranked 198th. B. Analysis of Pattern of Ranking of Urban Competitiveness  The report shows that the ranking of urban competitiveness changed dramatically. The competitiveness of cities in the Bohai Ring rose significantly. The competitiveness of cities in Zhejiang declined and the competitiveness of some cities in Taiwan declined significantly. Overall, the urban competitiveness of the following regions changes from high to low in the following order: Pearl River Delta, Yangtze River Delta, Taiwan region, Bohai Ring, Northeast China, Central China, Southwest China and Northwest China. There are also significant differences in urban competitiveness within each region. High-income cities and large cities have high urban competitiveness while low-income and small cities have low urban competitiveness generally. C. Brand Building The theme of this year’s report is “Brand: The Most Beautiful Scene of Cities”. There are case studies on how cities build up their brands. It is found that Hong Kong, Shaoxing, Nanjing, Nanchang and Xiamen have good practices in the development of business brand, Hangzhou, Ningbo, Shenzhen and Shanghai in tourism brand, Weihai, Chengdu, Nantong and Zhuhai in residential brand, Beijing, Qingdao, Quanzhou and Chongqing in brands of local products. 2. Urban Competitiveness Seminar: Hong Kong’s Competitiveness, an Inspiration from Major Urban Competitiveness Indices Prof. Yeung Yue-man and Prof. Shen Jianfa from Hong Kong Institute of Asia-Pacific Studies/Dept of Geography and Resource Management, The Chinese University of Hong Kong spoke at the Urban Competitiveness Seminar. They examined the urban competitiveness strength of Hong Kong and the key measures to enhance Hong Kong’s urban competitiveness. Based on the major international urban competitiveness indices, the relative position and strengths of Hong Kong are revealed. ŸWorld Economic Forum – Growth Competitiveness Index: Hong Kong’s ranking dropped from 2nd (1997) to 28th (2005); the index was revised as Global Competitiveness Index: Hong Kong improved from 14th (2005) to 11th (2006) (3rd in Asia); Institute for Management Development – World Competitiveness Index: Hong Kong dropped sharply from 3rd (1997) to 14th (2000) but bounced back to 2nd (2006); Hong Kong is catching up with the US; The Heritage Foundation – Index of Economic Freedom study: Hong Kong has been the world’s freest economy for 13 consecutive years; Chinese Academy of Social Sciences: 2007 Chinese Urban Competitiveness Study: Hong Kong is the top Chinese city; Japan Centre for Economic Research – Potential Competitiveness: Hong Kong recognized as the most competitive economy in 2005 and 2006. The first four indices, which measure immediate past years’ economic, social and governmental performance, and the last index, which analyzes potential competitiveness, reveal highly comparable results for Hong Kong. The city has scored highly on its infrastructure development, financial market, business environment, efficiency and flexibility, legal system, as well as government administration. Maintaining, indeed strengthening Hong Kong’s advantages and competitiveness in all aspects is definitely the key for our future. We need to strengthen our infrastructure connections, both internally and externally, in transportation, communication, and industrial and commercial sectors. The scope of financial services should be expanded and operation cost should be lowered in order to consolidate Hong Kong’s role as the financial centre of Asia. The independent and impartial role of our judicial system should be persevered. The government must also provide assistance to our economy, without any necessary intervention. Indeed, critical issues such as environmental degradation, deteriorating living quality, education, and innovation and technology are hindering Hong Kong’s performance in the competitiveness ranking, threatening our future. Worsening air pollution is reflected in the dwindling number of days with blue sky. Employees in foreign enterprises are scared away, with some regional offices broaching relocation. Moreover, Hong Kong’s rankings in the living environment, living area, recreational and sports facilities fare poorly. Is a simple “Action Blue Sky” campaign able to solve the air pollution problem? Can the government provide concrete policies to raise the quality of life? The new government for the 2007-2012 term should take all these issues on board. With regard to talents and education, and innovation and technology, increasing admission to local universities, admitting quality migrants, developing science and technology parks, as well as enhancing regional cooperation are strategies that can improve Hong Kong’s competitiveness. We await better results to turn the situation around. Ms. Karen Tang, Executive Director of the Better Hong Kong Foundation concluded that: ”To maintain Hong Kong’s competitiveness, it is crucial to emphasize its strengths and rectify its weaknesses. Hong Kong needs to consolidate its pillar industries in finance, business and trade services and the ability to attract foreign capital. The headquarters economy should be an avenue along which Hong Kong’s status and its reach of services and functions can be expanded. Hong Kong must also expand its hinterland and promote regional cooperation as ways to highlight our uniqueness and competitiveness. Above all, the government and different industries are well advised to catch every opportunity in this ever-changing world to forge ahead in global urban competition.”          (End) For enquiries, please contact Miss Alice Mak, Communications Manager of The Better Hong Kong Foundation, Tel: 2865 3529 / 60306025

Metropolis (International City) Competitiveness Study: Hong Kong Vs Shanghai

2007.03.21
Hong Kong-Shanghai Metropolis (International City) Competitiveness Study shows that Hong Kong is still ahead of Shanghai in terms of all composite competitiveness indicators in 2006, and remains an international business hub.  However, the international city competitiveness scores of the two cities are narrowing in the past 6 years. The study has been conducted annually for six years, by the research team from the Faculty of Business Administration, the Chinese University of Hong Kong and the Hong Kong & Macau Studies Centre, Shanghai Academy of Social Sciences. It comprises of a 32-item survey results of 210 CEOs of multinational corporations based in Hong Kong and Shanghai, and a subject analysis of the survey results. The research team joined hands with the Better Hong Kong Foundation to hold a briefing session in Hong Kong today (21st March, 2007) to announce the results of the annual study. This year’s survey conducted in December 2006 is based on the Pyramid of Metropolis (International City) Competitiveness (PCC, 2002) using a 32-item structural questionnaire. The three major PCC dimensions measured are (A) base for sustainable economic growth (20 items), (B) investment environment (10 items), and (C) image of globalization (2 items). A sample of 210 CEOs of multinational corporations (MNCs) based in Hong Kong and Shanghai were invited to rate the achievements of Hong Kong and Shanghai on the 32 indicators. The survey findings include: On International City Competitiveness, the highest average competitiveness score is 5, Hong Kong’s score is 4.08, whereas Shanghai’s is 3.21; the difference is 0.87 Hong Kong’s score is still ahead that of Shanghai, but the difference is narrowing, a consistent behavior observed during the past five years Hong Kong consistently scored higher in competitiveness over Shanghai in all the three PCC dimensions: Base for Sustainable Economic Growth: Hong Kong’s score for sustainable economic growth is 4.02 and Shanghai is 3.05, the difference is 0.79. Investment Environment: Hong Kong’s score is 4.13 and Shanghai is 3.05, the difference is 1.08. Image of Globalization: Hong Kong’s score is 4.30 and Shanghai is 3.63, the difference is 0.67. Professor Tuan Chyau pointed out that, “Compared to last year, the investment environment of Hong Kong is still seen as the most significant dimension over Shanghai, but the gap between Hong Kong and Shanghai is narrowing in image of globalization. The difference in the scores of the three dimensions is also decreasing, this is due to the higher scores given to Shanghai by MNCs (especially in investment development), and no increase in the scores given to Hong Kong.” Professor Linda Ng added that “Both Hong Kong and Shanghai’s average competitiveness scores and scores in all the three dimensions show an increasing trend since 2001. The survey results reflect that under the present situation, Hong Kong with its well established platform for market economy and financial system is still viewed as ahead of Shanghai by MNCs.” Subject analysis of the annual survey This year’s subject of analysis is the relationship between Hong Kong, Shanghai and the regional integration of Pearl River Delta & Yangtze River Delta. The research team has studied two groups of indicators: one to measure the significances of Hong Kong to the Pearl River Delta Region and Shanghai to the Yangtze River Delta Region; the other group is economic figures reflecting the economic growth of the two cities.  Prof. Ng remarked that “Although Hong Kong’s GDP is still much higher than that of Shanghai; the growth rate of Shanghai’s GDP in the past 10 years is much higher than Hong Kong. However, Hong Kong still has a proper platform for market economy and well established financial system, which will help Hong Kong to remain as an international hub.” Prof. Tuan commented that “The 11-5 plan will definitely help Shanghai move forward and achieve more growth in the service industries. Hong Kong may lose eventually her unique and dominant role which she enjoyed in the region in the past half of a century, but Hong Kong’s economic growth will not be undermined or stagnant since China has the need of multiple metropolis in considering her sheer size; and the natural geographical locations of both cities at South and East China resulting in a natural division of labor between the two cities.” Ms. Karen Tang, the Executive Director of the Better Hong Kong Foundation says that, “The study is very useful for Hong Kong’s policy makers to consider and formulate Hong Kong’s economic and financial polices. The survey result clearly points out that Hong Kong still excels Shanghai in a large extent in investment environment, the policy makers must endeavour to continue to provide an investment-friendly system to maintain Hong Kong’s competitiveness.” Ms. Karen Tang further added that, “Metropolises like Hong Kong and Shanghai are facing challenges of globalization. Both cities should capitalize their resourceful and productive hinterland, and act as the gateway to the World for China, to strengthen their bases for sustainable economic growth. The Better Hong Kong Foundation believes that through developing economic ties, the two cities will be able to enhance both their international competitiveness. The Foundation will explore with the research team and other related organizations in Mainland and overseas to promote interaction and more collaboration between the two cities. ” For enquires please contact: Miss Alice Mak of the Better Hong Kong Foundation: (852) 2865 3529 / (852) 6030 6025

The Better Hong Kong Foundation’s Mission to U.S. – A Resounding Success

2006.05.30
HONG KONG(May 30, 2006) Hong Kong Foundation’s delegation has just returned after a successful 11-day mission to the United States, between May 7-18, 2006. The mission visited Washington D.C., New York Boston and San Francisco.  As part of continuous efforts in keeping Hong Kong a prominent business spot on the world map, the Foundation’s visit serves to update American opinion-leaders and interlocutors on Hong Kong. As a two-way exchange, the visit aims to deepen the delegates’ understanding of how American thought-leaders and decision-makers perceive the Hong Kong SAR under the “One Country, Two Systems” principle and under the aegis of the Basic Law. The delegation, led by Mr George Yuen, Chief Executive, the Better Hong Kong Foundation, included: Miss Elsie Leung, former Secretary for Justice, Miss Winnie Ng, Executive Director, Kowloon Motor Bus, Professor James Tang, Dean of Social Sciences Faculty of Hong Kong University, Visiting Fellow to the US Brookings Institute, Mr Alex Reyes, Senior Political Commentator, and a visiting fellow to Columbia University and Miss Karen Tang, the foundation’s Executive Director (Designate).   During the visit, the delegates presented to the United States administration, congressmen, business leaders, academia, think tanks and media with the latest political and economic situation of Hong Kong, its investment outlook and constitutional development. They included the State Department, the Commerce Department, the Senate and the House and their Staffers. Besides, discussions were held with the Heritage Foundation, the Cato Institute, the Brookings Institute and the Centre for International and Strategic Studies (CSIS) respectively.   Delegates also met with the top management of the U.S. famous corporations. Among them were Citibank, HSBC, Goldman Sachs, Morgan Stanley and the world’s famous rating agency, Standards & Poor’s. The delegates had attended forums at four top US universities including Harvard, Tufts, Stanford and UC Berkeley where Miss Elsie Leung addressed on the importance of rule of law as the core value for the HKSAR under the ‘One Country, Two Systems’ principle, among other topics such as the intellectual property right (IPR), the CEPA and constitutional development.   Delegation leader, Mr George Yuen described the mission a resounding success as manifested by a series of high level meetings with the U.S. officials, congressmen and their aides in Washington D.C. and top corporate CEOs in New York. They reasserted that Hong Kong’s one country two systems principle had been working very well and contributing to the stability and prosperity of the Special Administration Region. Mr Yuen remarked “Our mission was at best blessed with a multiple of ‘Fours’, starting with 4 major US cities, 4 influential legislators, 4 important financial institutions, 4 top US universities and 4 principal media organizations, not to mention 4 well attended forums. The visit has been both an eye-opening exercise and a learning experience as it has broadened our horizon on international relations and has broken new grounds on strategic networking. This annual visit is a fine tradition that we dearly value as the two-way exchange continues fostering an even closer tie between Hong Kong and the US communities.” Mr Yuen added “As the mission came in tandem with the Chinese President Hu Jintao’s State visit, we would have a clear appreciation of the importance of the Sino-US relations and its ramifications on Hong Kong. Moreover, the U.S. interlocutors reiterated that better U.S.-China relations would mean a better Hong Kong. Hence, the HKSAR would continue to assume an important role to facilitate friendly exchanges of U.S. and China opinion leaders and to promote a better understanding between two countries. The foundation will continue its activities in the U.S. and will assist in arranging congressional and media visits to China and Hong Kong. The same will apply to our major trading partners such as the European Union.”   Principal delegate, Miss Elsie Leung expressed confidence in the healthy and peaceful development of the Sino-US relations and hence would benefit Hong Kong as she made keynote speeches at important law forums and business luncheons in four hosting cities.   Mr Yuen thanked the U.S. Government and the Congress for giving the delegation such a high-level and warm reception. He also gratefully thanked the Hong Kong Commissioner and her directors-general of the three Hong Kong Economic and Trade Offices for their support rendered to the visit in the United States. Meanwhile, Mr Yuen paid tribute to the Chinese Ambassador in the U.S. the Consuls-General in New York and San Francisco for their efforts and assistance. More significantly was the foundation’s meeting with the Chinese Representative to the UN Mission for giving due recognition to the foundation’s mission in playing a part to promote the Sino-US relations.   Mr Yuen acknowledged “Equally important, we have a great team in our successful endeavours as everybody did an excellent job in conveying the right message.”   Miss Karen Tang, the incoming foundation’s Executive Director concluded, “We all took part in over 40 useful dialogues pivotal to future co-operation, business ties and educational exchanges. We will keep up our good efforts and build on our relations with opinion leaders, business community, research institutes, non-government organizations overseas for the economic health and public well-being of Hong Kong.” For enquires, please contact Ms Brenda Wong of the Better Hong Kong Foundation at 2865-3533.    End Background of the Better Hong Kong Foundation:The Better Hong Kong Foundation was founded in 1995. It is a privately funded non-profit organization, formed by leading Hong Kong business and community leaders to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. As we strive to create an even better Hong Kong for ourselves and our families, we are turning the promise of “One Country Two Systems” and a high degree of autonomy into reality. The Foundation’s mission is to share this sense of confidence in the future of the Special Administrative Region with overseas business and political leaders.

The Better Hong Kong Foundation Organizes High-Level Delegation to the United States

2006.05.02
The Better Hong Kong Foundation will make its annual visit to the United States covering Washington D.C., New York, Boston and San Francisco between May 8th-18th, 2006. The main purpose of the visit is to update the US Administration; Congress; think tanks; business and financial institutions; media and thought-leaders about the Hong Kong’s present situation, its constitutional development and economic outlook. At the same time, the foundation’s mission is to have the first hand information from the US interlocutors about American’s point of views on Hong Kong especially after the China’s President Hu Jintao’s State visit to the US and its impact on the US/China relations and its ramification on Hong Kong. The foundation’s Chief Executive, Mr George Yuen remarked: “This two-way exchange will enable us to renew old acquaintances and to forge new ties. Clearly, it helps us to consolidate our network; broaden our horizon and to break new grounds as we have a balanced program covering important audiences from government; legislature; academia; business; media; think tanks and related NGOs”. During the mission, the delegation will pay visit to the China Embassy in Washington D.C; consuls-general in New York and San Francisco together with meetings with directors-general in Hong Kong Economic and Trade Offices and Chinese community in the hosting cities. The delegation, led by Mr Yuen comprises of former Secretary for Justice, Ms Elsie Leung; Ms Winnie Ng, Managing Director of Kowloon Motor Bus; Professor James Tang, Secretary of Social Science of University of Hong Kong; Mr Alejandro Reyes, Senior Writer and Visiting Scholar of University of Columbia and Ms Karen Tang, Executive Director of the Better Hong Kong Foundation (Designate). Mr George Yuen concluded “It is fortunate to have a well-represented group to present the various aspects of Hong Kong special situation to our US thought-leaders, contacts and associates. It is also opportune to have the visit arranged in tandem with President Hu’s State visit to the United States so as to assess its impact on the US/China relations. We are most delighted to have former Secretary for Justice, Ms Elsie Leung to be our principal representative and we are thankful to our US partner, the US-Asia Institute to organize law forums for Secretary Leung to speak of the One Country, Two Systems and the importance of Rule of Law, being the core value contributing to making Hong Kong Asia’s world city. We are confident that our visit will be useful and constructive in fostering an even closer tie between Hong Kong and the United States.” Program   May 8, 2006 (Mon) Washington D.C. 09:00-10:30 Briefing by U.S.-Asia Institute on U.S. political scene & U.S.-China relations 12:00-13:30 Lunch meeting with Chinese Embassy 14:00 Meeting with Brookings Institution 16:00 Meeting with Cato Institute 18:00 Meeting with Reuters 19:30 Dinner with US-China Education Trust & The Fund for American Studies May 9, 2006 (Tue) Washington D.C. 08:00-09:30 Breakfast meeting with HK Economic & Trade Office Washington 10:30 Meeting with CSIS 12:15 Lunch meeting with Heritage Foundation 15:00 Meeting with State Department, US Government 16:30 Meeting with U.S.-China Working Group 19:30 Dinner meeting with Media May 10, 2006 (Wed) Washington D.C. / New York 10:30 Meeting with Commerce Department, US Government 15:00-17:00 Capitol Hill ForumThe Challenges and Accomplishments of Implementing One Country-Two Systems by The Honorable Elsie Leung Depart for New York May 11, 2006 (Thur) New York 09:30 Breakfast with Morgan Stanley 11:00 Meeting with Goldman Sachs International 12:30 Lunch with Fortune Magazine 14:30 Meeting with Asia Society 18:00-20:00 Public Law Forum at New York County Lawyers Association 20:30 Dinner with NY Consul General May 12, 2006 (Fri) New York 09:30 Meeting with Citibank 11:00 Meeting with HSBC 12:30 Lunch meeting with HK Economic & Trade Office New York & HK Association in New York 15:00 Meeting with Standard & Poor’s 19:15 Supper with Chinese Media May 13, 2006 (Sat) New York 12:00 Lunch with Chinatown community 17:00 Dinner with Norman and Esther Lau Kee, US-Asia Institute May 14, 2006 (Sun) New York / Boston Depart for Boston May 15, 2006 (Mon) Boston Morning Tufts University Fletcher School of Diplomacy Lunch Lunch meeting with Mr. Kent Lucken, World Boston, corporate & legal leaders Afternoon Harvard Kennedy School of Government Forum May 16, 2006 (Tue) Boston / San Francisco Depart for San Francisco 19:30 Dinner meeting with HK Student Association, Stanford University May 17, 2006 (Wed) San Francisco Morning Meeting with Pacific Council on International Policy (tbc) 12:00-14:00 Speaking luncheon hosted by HK Economic & Trade Office, in cooperation with HK Association of Northern California and Asia Society Afternoon Speaking event at the Institute of East Asian Studies of University of California, Berkeley Evening Dinner hosted by Mr. Peng Ke-yu, Chinese Consul General, San Francisco (tbc) May 18, 2006 (Thur) San Francisco 09:00-10:00 Media session Depart for HK For enquires, please contact Ms Brenda Wong of the Better Hong Kong Foundation at 2865-3533.   End   Background of the Better Hong Kong Foundation:The Better Hong Kong Foundation was founded in 1995. It is a privately funded non-profit organization, formed by leading Hong Kong business and community leaders to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. As we strive to create an even better Hong Kong for ourselves and our families, we are turning the promise of “One Country Two Systems” and a high degree of autonomy into reality. The Foundation’s mission is to share this sense of confidence in the future of the Special Administrative Region with overseas business and political leaders.

The Better Hong Kong Foundation Changes Chief Executive

2006.04.25
Dr Ronnie Chan, the Executive Committee Chairman of the Better Hong Kong Foundation, announced today that Mr George Yuen, the foundation’s Chief Executive, would retire on August 31st, 2006, after nine full years of service. Mr Yuen will assume an advisory role when Ms Karen Tang takes up the post of Executive Director on June 1st, 2006. Since 2003, Ms Tang has been the Director of Communications of the University of Hong Kong (HKU). Before joining HKU, Ms Tang held appointments in a variety of media and multimedia organizations, including that of Deputy General Manager of the Chinese Television Network, General Manager of the then Hongkong Telecom IMS (Interactive Multimedia Services), Director of Multimedia Services and Commercial Director of E-commerce under the Hutchison Whampoa Group. Prior to these, she was the General Manager of Yazhou Zhoukan of the Ming Pao Group, and also served as the Administration Officer of the former Basic Law Consultative Committee. Ms Tang holds a B.A. in Social Science (CUHK) and a M.A. in Public Administration (HKU). The foundation’s Board of Trustees would like to thank Mr Yuen for his commitment and many years of service to the well-being of Hong Kong. The Board also welcomes the appointment of Ms Tang as head of the foundation whose mission is to make Hong Kong an even better place for business and, indeed, for all our citizens. For enquires, please contact Ms Rita Ma of the Better Hong Kong Foundation at 2865-2320. End Background of the Better Hong Kong Foundation:The Better Hong Kong Foundation was founded in 1995. It is a privately funded non-profit organization, formed by leading Hong Kong business and community leaders to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community. As we strive to create an even better Hong Kong for ourselves and our families, we are turning the promise of “One Country Two Systems” and a high degree of autonomy into reality. The Foundation’s mission is to share this sense of confidence in the future of the Special Administrative Region with overseas business and political leaders.

Better Hong Kong Foundation – A Joint Effort to Promote Hong Kong Overseas

2005.02.28
During the Chinese New Year, the Better Hong Kong Foundation has spearheaded a concerted effort with Hong Kong’s government and public statutory bodies to promote Hong Kong to the international community. A delegation, led by Mr. George Yuen, Chief Executive of the Better Hong Kong Foundation, was composed of leading members from Hong Kong’s governmental and public bodies, namely Mr. Thomas Woo, Council Member of the Better Hong Kong Foundation; Mr. Daniel R. Fung, Chairman of East-West Strategic Development Commission; Ms Sarah Monks, Director of Communication, Hong Kong Trade Development Council; Ms Pricilla Law from Invest Hong Kong, as well as representatives from Hong Kong Economic and Trade Office New York and Pacific Basic Economic Council (PBEC), an international organisation whose headquarters is based in Hong Kong. The visit, which commenced on February 14 and ended on February 18, included more 25 high-level meetings in New York City and Washington, D.C., with influential American audiences, including senior representatives from both the Administration and the Congress, leading financial institutions, such as Morgan Stanley, Goldman Sachs, Standard & Poor’s, HSBC USA, Citigroup Inc., and New York Stock Exchange; prominent think-tanks including Asia Society, Heritage Foundation, Cato Institute, National Committee on U.S. – China Relations and mainstream media, like Forbes and Fortune Magazines and Washington Post. The delegation had in-depth dialogues with Asia Society and Guggenheim Museum that have shown great interests in Hong Kong’s cultural development project. The delegation also met with the Chinese Ambassador to the Unites States, Mr. Yang Jiechi, who especially conveyed his best regards to people in Hong Kong. The main purpose of the visit was to provide an annual update to the American opinion leaders and interlocutors about Hong Kong’s latest socio-political situation, economic outlook as well as other issues of mutual interests. The delegation, in particular, highlighted two upcoming events, the Grand Opening of Disneyland and the World Trade Organisation Ministerial Meeting, which are believed to put Hong Kong under the international spotlight. The delegation also briefed the American interlocutors various aspects of developments, like the constitutional development, educational reform, cultural development project and environmental protection. Mr. Daniel R. Fung, being the Chairman of the Broadcasting Authority, highlighted Hong Kong’s well-positioned role as the regional broadcasting hub. Mr. George Yuen saw the delegation as a united front in putting different bodies together to showcase Hong Kong in the international community and to highlight her importance as Asia’s World City, “We deliver one strong message: trying to promote Hong Kong from different perspectives – as a platform of international trade and investment, a pivotal role in Pan Pearl River Delta economic integration, a role-model for other economies in the area of intellectual property protection, a regional hub of broadcasting and telecommunication, as well as tertiary education.” Mr. Daniel R. Fung added that the visit has reaffirmed Hong Kong remains a premier centre of business and financial activities on the world map, as reflected by the immerse interest of the U.S. thought leaders. Mr. Fung reasserted, “There is no room for complacency as Hong Kong needs to continue to sharpen its competitive edge in creating favourable business environment for investments in the face of competitions from neighbouring economies.” Ms Sarah Monks highly regarded such an opportunity of collaboration: “We were able to highlight to the US decision-makers and media, the enduring institutional strengths of Hong Kong, in particular, our separate legal system and Hong Kong’s protection of intellectual property. The mission yielded valuable insights that will help to inform TDC’s upcoming outreach activities in key US cities.” The delegation noted that the American opinion leaders and interlocutors were deeply impressed by Hong Kong’s economic rebound after the devastating SARS outbreak in 2003, and looked forward to a steady growth in the year ahead. The delegation indeed capitalized the opportunity to relate a positive aspect of the SARS outbreak: “the SARS helps Hong Kong to crystallize, after several years of soul-searching, that our future ties closely with the neighbouring Pearl River Delta region. The resultant closer economic integration with the Greater and even Pan Pearl River Delta region is our way out of future development,” as told by Mr. Al Reyes, a policy analyst of PBEC to the American audiences. Also noteworthy was the affirmation made by both the Heritage Foundation and Cato Institute in recognizing Hong Kong’s continuous efforts in keeping herself as the freest economy in the world. Mr. George Yuen summed up the results by saying that “the visit was such a success in providing a platform for different bodies to convey a positive message to the international community that Hong Kong remains as a vibrant and free economy, a centre of international trade and investment, a pivot of neighbouring PRD and regional integration, as well as a regional hub of broadcasting and telecommunication.” For enquires, please contact Ms. Elsie Leung of the Better Hong Kong Foundation at 2865-3529.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional financial, shipping, trading, communications and technology center.  The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Visit to South Africa – More Than a Safari

2004.11.09
This year, the Fraser Institute, the project organizer for the Economic Freedom of the World Index hosted its Network Annual Conference in Cape Town, South Africa, October 19-20, 2004.  As the co-host was the Free Market Foundation of the Southern Africa, understandably African countries were well represented there.  At the conference, Hong Kong was again featured as the champion for the economic freedom which set an example for many developed and developing countries to follow.  Clearly the obvious impact was on China.  As the Better Hong Kong Foundation is closely associated with the Institute, I had the good fortune being the only Asian representative in this annual conference.  It was gratifying to experience being consulted on Hong Kong example.  Hong Kong has been ranked the freest economy for eight consecutive years.  Also I updated the authors of the economic freedom of the world reports, Professor James Gwartney of Florida State University in USA and Professor Robert Lawson, Capital University in USA on the recent constitutional development and economic outlook for Hong Kong as well as China, as both the size and machinery of the government and the rule of law play a critical role in promoting economic freedom of a country or a territory. In fact, going to Cape Town seems like going to a place very familiar with Hong Kong particularly with much alignment to the foundation’s mission.  That is “we work for the people united for a better Hong Kong and a better world”.  So do the South Africa.  There are ‘The Big 5’ – elephant, leopard, rhinoceros, buffalo and lion’ in South Africans.  However my visit to the country is more than going on a safari, as I can appreciate better and deeper the other Big 5.  They are: (1)         Rule of law with great importance attached to corporate governance. (2)         The “can-do” attitude. (3)         Education as top priority. (4)         Sustainable environment development. (5)         Demonstration of reconciliation and understanding among people. The world should know since 1960 four South Africans had won the Nobel Peace Prizes.  It is this “Big 5” impresses me very much and gives me causes to reflect upon my trip in the context of the present Hong Kong situation. Going to Cape Town has given me a sense of warmth and friendliness as the city resembles Hong Kong.  A great part of central business district has been built on reclaimed land as it shares with Hong Kong on the top rank of the world’s best harbours with the famous Table Mountain over-looking the sea as the other mountain called the Lion’s Head sits opposite.  It is just like Hong Kong’s Victoria Peak and Kowloon’s Lion Rock.  Besides, both Hong Kong and South Africa have defied the doom sayers’ predictions.  For South Africa, the Apartheid policy had over-shadowed the transfer of government from the white to the black in 1994.  Likewise, the “Death of Hong Kong” story appeared in the Fortune Magazine on June 1995 had provided a lot of negative stories for the western media to write about former colony’s future, as China resumed its sovereignty of the territory in 1997.  Yet both South Africa and Hong Kong have come up with historic political solutions that have astounded the world.  We are both working to achieve a refreshing and different social economic solution which provides again an inspiration to the world against our colonial past and the negative predictions.  Our “one country, 2 systems” principle stands the test of times.  Many of our law makers have been to the Untied States of America and Europe and make their pilgrimage to the respective western governments to learn from their democratic progress, financial infrastructure and sustainable development programme.  They now should look to South Africa to study their strengths and their challenges so as to provide insights for us to make adaptive change to Hong Kong’s development. South African constitution is considered one of the most progressive countries in the world as supreme and justicable under a Constitutional Court.  So is Hong Kong’s Court of Final Appeal with Lawlords from the British Commonwealth on its judicial panel.  South Africa’s own experience of resolving the history of violent conflict had allowed it to contribute to a number of successful peace initiatives in Africa and the rest of the world.  At 30%, South Africa has one of the highest percentage of seats in Parliament held by women.  When Nelson Mandela, the founding father of the present South Africa Republic, spoke to the nation in 1994 both the white and the black stressing on the importance of unity on the principle of forgiveness and understanding and reconciliation and cooperation.  South Africa has given the world an alternative model that fosters the nation building and encourages trust in post-conflict situation. The country has the ability to take a tragedy and turn it into a lesson for the world. Just to quote Charlize Theron, the first South African to win the Oscar Award for the Best Actress, she said: “You don’t need to win an Oscar to do something good for your country.  We can all do that.  Whatever I can do in my power, I promise you I will do it.  It’s our duty as citizens of this country.” My good friend, Mark Mobius, Portfolio Manager at Templeton also commented: “South African companies tend to have good corporate governance, capable managers, and can compete against the world’s best.  Investors can also take comfort from the government’s sound fiscal management and efficient central bank.” South Africa is a proof that the image of South Africa so often portrayed as beset with chaos and failure to a travesty of the truth.  In fact the country is an embodiment of democracy, peaceful transition, co-existence between communities and resilience among its people.  There must be good reasons for the South Africans to have positive attitude as the country has one of the highest levels of expenditure of education in the world, currently at 20% of the GDP. Hong Kong needs to learn from this.  On my trip to Cape Town, the plane was almost full with half of the passengers being Mainland Chinese.  I asked around to discover the purpose of their visits with most of them going on business and the rest of them going to study in South Africa.  I was probably the only Hong Kong Chinese.  Being the first time visitor, I came to South Africa to attend the conference and to see the Big Five, the game reserves, mountains and beaches but I didn’t expect that I fell in love with the people in South Africa, as they are the people with aspiration and determination to succeed. With so much things to learn and so much development in South Africa, business people, politicians, community leaders and media in Hong Kong should go to African nation to share experience and to exchange views on our future as both Hong Kong and South Africa have so much similarities in our backgrounds, our economic strengths and our political aspirations.      For enquires, please contact Ms. Elsie Leung of the Better Hong Kong Foundation at 2865-3529. End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional financial, shipping, trading, communications and technology center.  The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Hong Kong Urged to Seize the Twin Opportunities in the Pan-Pearl River Delta and China’s Western Development

2004.08.10
The signing of the Pan-PRD Regional Co-operation Framework Agreement as well as the recent Hong Kong and Guangdong Co-operation Joint Conference have signified a new phrase of an even deeper economic integration between Hong Kong and the mainland.  Mr. George Yuen, the Chief Executive of the Better Hong Kong Foundation said at a press briefing co-organised by the Better Hong Kong Foundation and Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong, “As Hong Kong and China have become closer than ever, the future of Hong Kong would have a stronger strategic partnership with its neighbouring economies as well as its greater reliance on the economic development in the mainland. Therefore, those opportunities arising from two national development strategies, the Pan-PRD Regional Co-operation and the ‘Going West’ are something we have to make the best use.” Two months ago, an innovative and landmark regional cooperative development framework focused on the Pearl River Basin and the area to the south of the Yangzi River was formally established.  Leaders from nine provinces led by Guangdong, namely, Guangdong, Guangxi, Yunnan, Guizhou, Sichuan, Hunan, Jiangxi, Fujian and Hainan Dao, plus Hong Kong and Macau, briefly known as ‘9+2’, met to promote a new cooperative framework that would capitalize on their respective strengths to accelerate development.  This is an innovative development framework that will have long-lasting impacts on China and its people. Professor Yeung Yue-man, Director of the Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong, and Chairman of the Panel on PRD, Central Policy Unit remarked: “The Pan-Pearl River Delta (Pan-PRD), consisting of about one-fifth of China’s land, one-third of its population, one-third of its GDP and half of its foreign investment, is an important part of China.  For more than two decades, Guangdong (especially the PRD) and Fujian have experienced exceptionally rapid growth in an era of reform and openness, with Hong Kong and Macau providing the catalyst.  Their positive and revolutionary change has astounded the world.  The Pan-PRD framework is intended to extend this development trend to the neighbouring territories, bringing with it modernization, industralization and professionalization.  In this development design, the special and advanced roles of Hong Kong and Macau figure prominently.” During the past year, Hong Kong has benefited from new policies relating to CEPA and the individual tourist travel scheme.  This has brought about a healthy economic recovery, as reflected by price increases in the property and stock markets.  With the birth of the Pan-PRD, the future of Hong Kong looks more rosy.  In fact, if the opportunities brought about by the Pan-PRD can be fully harnessed, it is not far-fetched to imagine Hong Kong will begin another cycle of growth.  The question is, how should Hong Kong manage its change and where to begin? Professor Yeung commented, “From all indications, ‘looking west’ seems to be a more rational choice.  In the first place, after two decades of development, the imbalance in the level of development between the two wings of the PRD has surfaced.  More actively developing the western wing area will not only bring out the potential and advantages of the five prefecture-level cities of Zhaoqing, Foshan, Jiangmen, Zhongshan and Zhuhai, but also the pressure that has been brought to bear on Dongguan and Shenzhen arising from the lack of developable land and rising land and labour costs, will ameliorate.  The continued improvement in infrastructure in the western wing, together with the soon-to-be-announced construction of the Hong Kong-Zhuhai-Macau Bridge, will add new dynamism in propelling this area forward.” The western wing of the PRD is territorially contiguous with Guangxi, Yunnan, Guizhou and Sichuan.  These four provinces in the southwest are rich in natural resources, people, minority groups, water and mineral resources.  They are obviously complementary with Guangdong, Hong Kong and Macau in development.  In the cooperative framework that is being designed in the Pan-PRD, this large part of China’s southwest can, through the advantages of Hong Kong’s financial centre, logistics, communication and tourism, help it export its commodities to the world market.  As well, Hong Kong can lend its development experience to elevate the level of professional service and modernization in these provinces. Apart from being part of the Pan-PRD cooperative framework, China’s four southwestern provinces constitute an important part of China’s Western Region Development Strategy promulgated in 1999.  The four provinces in fact form part of six provinces in the grand design of the southwestern wing of the western region.  Within the four provinces in question is concentrated a large proportion of China’s southwestern cities, economic development, talent and scientific ability.  Although they have witnessed creditable development over the past years, the Pan-PRD new policy initiative means that they are under the double advantage of two sets of favourable policies.  They can be likened to have boarded an economic super-express train poised for even more rapid progress.  In general, Hong Kong can seek complementary development with the western region.  However, the Hong Kong impact has not been widely felt to date.  There is much room for Hong Kong government and investors to double their efforts, so that Hong Kong’s strengths can be highlighted and opportunities inherent in the new policies fully seized.  Furthermore, since Yunnan and Guangxi share land boundaries with Southeast Asian countries, they are certain to play vital roles in China’s continuing efforts to develop free trade with ASEAN countries in the ‘10+1’ framework. Professor Yeung concluded by asserting: “The above analysis is purported to highlight the fact that, with the emergence of the Pan-PRD, Hong Kong now stands at a crossroads.  ‘Going west’ appears to have many tempting factors, including the recent efforts by governments concerned to speed up development in the western wing of the PRD and the double policy benefits that will give a boost to the four provinces in China’s southwest.  All this will create conditions for more advantages mutually attainable for Hong Kong’s entrepreneurs, investors and the public at large.  From this standpoint, for Hong Kong government and investors to ‘look west’, it is incumbent on them to begin the process of learning and getting to know this part of China.  They need to better prepare themselves before deciding on their strategy of development, investment, cooperation and exchange.  Ultimately, Hong Kong should step up its efforts for welcoming a bright future that the Pan-PRD regional framework will bring.” For enquires, please contact Ms. Elsie Leung of the Better Hong Kong Foundation at 2865-3529. End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional financial, shipping, trading, communications and technology center.  The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Hong Kong as Asia’s World City reaffirmed at INSEAD/Wharton Global Forum in Moscow

2004.05.30
“Hong Kong is your business partner in China” was the message as Mr. George Yuen delivered his address at the INSEAD/Wharton Global Forum in Moscow on May 21st, 2004 when the alumni of the two world’s top business schools had their joint annual meeting in Russia.   Mr Yuen spoke in his capacity as Chief Executive of The Better Hong Kong Foundation and an INSEAD graduate, at the forum’s workshop on “Emerging Consumer Markets”.  He told the gathering of more than 200 corporate leaders, being alumni of the two business schools from the United States of America, the United Kingdom, Russia, European Union, the Middle East and Asia countries that “Excellent business opportunities await for both multinational corporations and small and medium enterprises on mainland China in the respect of market expansions and manufacturing set-ups.  Mr. Yuen remarked, “This is particularly timely after China’s accession to the WTO for the country has to be a responsible and responsive global player in the present rule-based economy.” Mr. Yuen reasserted the pivotal role Hong Kong played because of its long experience in international trade with its economic strengths and professional expertise in dealing with enterprises in China and those in the rest of the world.  “Clearly, Hong Kong international financial stature is unrivalled in Asia because of its location, reaching some 40% of the world population within 4 hours of flying time.  Besides, Hong Kong is positioned in the 24 trading-time cycle between two other financial capitals, New York and London.  More significantly, Hong Kong’s pillars of strength are its rule of law, low tax structure, freedom of information, clean government, level-playing field principle and well proven best practice in financial and institutional tradings.” Mr. Yuen added. During his visit to Moscow, Mr. Yuen met Mr. Mikhail Fradkov, Prime Minister of Russia Federation and Mr. Aleksey V. Kuznetsov, First Deputy Chairman, Government of the Moscow Region.  Mr. Yuen had also made alliance with an influential business group, Russian Information Agency, in Russia as the group would lead a business delegation to Hong Kong and the Pearl River Delta (PRD) region in coming October.  This would be followed by two more delegations, one from Kuwait and other from Israel as both would be interested in investing in South China as the greater PRD offers good business prospects and development potential.  They would be expected to make their visits in November 2004. Mr Yuen described the INSEAD/Wharton Global Forum a great success for Hong Kong to promote overseas especially in Russia and CIS.  The timing of the visit had been excellent as the meeting followed the Chief Secretary’s visit to Moscow on May 18th and the Hong Kong Jewelry Manufacturers’ delegation to Russia on May 19th.   For enquiries, please contact Ms. Elsie Leung, Communications Manager, The Better Hong Kong Foundation at (852) 2861-2622 or by fax at (852) 2861-3361. – END – The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional financial, shipping, trading, communications and technology center.  The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Hong Kong Constitutional Development: A Perspective From Business Community

2004.05.03
The recent discussion on HKSAR’s constitutional development has been a topical issue of public interest here and overseas. As a member of the business community, Better Hong Kong Foundation (The Foundation) would have to share views from our own perspective. On Monday, April 26, the National People’s Congress Standing Committee (NPCSC) made a decision to allow the specific methods for selecting the Chief Executive in 2007 and forming the Legislative Council in 2008 be appropriately modified, but not to introduce the universal suffrage in both elections after a careful study and thorough discussion of a report submitted by the Chief Executive Mr. Tung Chee Hwa. The Foundation, along with local business coomunity, see NPCSC’s decision as timely and appropriate, given it has set clearly out on the scope for amendments on the electoral methods of 2007/08. The Foundation thinks our community can now put through the discussion of the constitutional development in a pragmatic manner. Most of the local and overseas groups that the Foundation has been in contact with now have a better understanding of the rationale for the decision made by the NPCSC. We agree that any major change to the existing system should take into consideration of opinions and suggestions of various sectors in order to maintain the long-term prosperity and stability of Hong Kong. The Foundation also believes the constitutional development in Hong Kong has been proceeding gradually and orderly on the path laid down by the Basic Law since the reunification six and half years ago. As an international city, any political development must in line with Hong Kong’s economic status, and consistent with the actual situation in Hong Kong. Mr. Qiao Xiaoyang, Deputy Secretary-General of NPCSC, listed six reasons to further explain that the situation in Hong Kong did not warrant universal suffrage: (1) many Hong Kong people still have an inadequate understanding of ‘one country, two systems’ and the Basic Law. The concept of ‘one country’, national identity, the legal status of Hong Kong and meaning of universal suffrage are not so clear to the general public; (2) the Basic Law’s status as the constitutional law of Hong Kong has not just been established and has not been adequately understood; (3) the political system in Hong Kong must cater to the interests of every social class, group and sector, with balanced participation by each group; (4) Hong Kong’s economy is in a period of recovery and cannot withstand any shocks; (5) as the executive authorities and the legislature are still in a period of running in, the executive-led system is still far from a full implementation; and (6) there are varied views in Hong Kong regarding the implementation of universal suffrage in 2007/08. The Foundation regards those six factors reflected the Central People’s Government (CPG)’s full understanding of Hong Kong’s actual situation. The Foundation also agrees those factors should be fully observed and addressed before any introduction of the universal suffrage. Moreover, the constitutional development should carefully be considered to safeguard Hong Kong’s economic competitiveness and effectiveness. The Foundation agrees that Hong Kong should put through its constitutional development in a gradual and orderly manner as stipulated by the Basic Law, with an ultimate aim of selecting the Chief Executive and electing the Legislative Councillors by the universal suffrage. However, during the process of achieving such a goal, the interest of every social class, group and sector must evenly be represented. The Foundation also believes the principle of representative participation should be upheld in the existing electoral system in order to ensure that participation of various sectors through different channels. Under such a comprehensive and thoroughly-designed arrangement, the participation of industrial and business sector as well as the middle class can thus be guaranteed and protected by the institution concerned. Actually, Qiao’s six factors are expressing the similar thinking as those nine principles contained in the Chief Executive’s report. The Foundation believes as the NPCSC already decided the electoral arrangements of 2007/08, and allowed certain degree of modification; our community should therefore uphold a pragmatic spirit and adopt a rational attitude to come up with different proposals within the framework of the Basic Law. Having experienced a series of economic downturns and adversities in the last six and half years, our community should work together for a more stable and prosperous Hong Kong, our Asia’s World City. Clearly all constitutional developments must be geared up in maintaining the social harmony in the community. For enquiries, please contact Ms. Elsie Leung, Communications Manager, The Better Hong Kong Foundation at (852) 2861-2622 or by fax at (852) 2861-3361. – END – The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

EU Forge Closer Business Ties with Hong Kong – The Pearl River Delta

2003.11.24
The Better Hong Kong Foundation’s delegation had just returned after a 9-day mission to the United Kingdom, Germany and France. This mission signified the importance that Hong Kong’s major trading partners in Europe, attached to Hong Kong’s geo-economic position and their confidence in its people and business strengths in Asia. The delegation presented state secretaries, ministers, senior government officials and business leaders in host countries with the latest political and economic situation of Hong Kong; and the Pearl River Delta, its investment outlook and development on infrastructure projects, environmental protection, human capital, technology and innovation. Delegation leader and Foundation’s Chief Executive, George Yuen described the mission a tremendous success as Hong Kong remained the Asia headquarters for multinationals in our region and continued to capture the interest of its major trading partners in Europe after China’s accession to the World Trade Organisation. “Clearly the visit has been particularly timely for us to feature Hong Kong as the best springboard for European companies especially the small and medium sized enterprises to have market access to Mainland China on the eve of the Closer Economic Partnership Arrangement (CEPA) implementation five weeks from now, on 1 January, 2004.  This will present an excellent window of opportunities for forming strong strategic alliances among business communities in Europe and Hong Kong.  The mission has also established links with major think tanks, NGOs, business associations and chambers of commerce on educational exchanges and business partnership in the future.” Mr. Yuen added. Among the delegates were leading members in Hong Kong and the Pearl River Delta’s professional and business communities. They included Mr. Daniel FUNG, Senior Counsel, Des Voeux Chamber and Chairman of the East-West Strategic Development Commission (ESTRADEV); Mr. Fred Wang, Director, Salon Film and Governor of ESTRADEV; Ms. Vicky Wong, Managing Consultant, EPC Consulting Ltd.; Madam Carrie Xu, President, Guangzhou Foreign Enterprises Consultation Service Company; Ms. Ada Wong, Head of Industrial System, Wong’s International (Holdings) Ltd. and Mr. Eric Yao, Manager of Technical Engineering; Wong’s International (Holdings) Ltd. In London (11-12 November, 2003), the delegation met with the business community there to urge them in enhancing the already entrenched business presence in Hong Kong. The delegation renewed links with the UK Trade & Investment, the Institute of Export and the Hong Kong Association and forge new ties with relevant professional bodies and services organisations.  Also, the delegation took part at the Hong Kong Tourism Board “Live it, Love it!” campaign and the Hong Kong Trade Development Council annual dinner in London. As a keynote speaker at business gatherings in London, Mr. Daniel Fung articulated the four pillars of strength for Hong Kong’s continued top rank as the freest economy in the world. The level-playing field practice, the WTO business compliance, the zero tolerance for corruption and the rule of law made up the formula for Hong Kong’s success. Mr. Fung remarked, “In keeping abreast with today’s knowledge economy and trade globalization, Hong Kong is expanding its business portfolio to embark on a bold and visionary infrastructure development on technology and innovation, and a mission-critical human resource policy to upgrade the quality of our work force.  Equally important, Hong Kong’s hinterland, especially the Pearl River Delta region, presents a favorable investment environment for a wide spectrum of manufacturing and service businesses to develop and flourish, especially when the Closer Economic Partnership Arrangement (CEPA) offers the first mover advantages to Hong Kong based companies with no restriction on nationality.” In Berlin (13-15 November, 2003), the delegation met with German Minister for Economics and Labour and Secretary of State for Foreign Affairs on closer economic ties with special attention paid to Hong Kong’s role in fostering trade between the Greater Pearl River Delta and the Greater Mekong River Delta region especially Vietnam. During the visit, the foundation formed alliances with Berlin Partner, an organisation sponsored by the Berlin Senate; the German Federation of Trade and Industries; and Hasso-Plattner Institute of Universtat Potsdam, for future co-operation in promoting the Hong Kong-German trade, education and cultural exchange.  As an indication of forward-looking economic relations, on December 1 the German Federal Chancellor, Gerhard Schroder, would visit Guangzhou to expand the German automobile business as the city would open the biggest-ever international automobile show. In Paris (16-18 November, 2003), the group met with the Chinese Ambassador to France, Mr. Zhao Jinjun and exchanged views on the importance of the Hong Kong/Pearl River Delta economic integration for the prosperity and the well-being of the region.  The delegation established dialogues with the Organisation for Economic Co-operation and Development (OECD), among other organizations, to discuss the hosting of an International Mayors’ Conference in China, using Hong Kong as a conference facilitator co-ordinator.  The Foundation would assist in an OECD visit in March 2004 to assess which Chinese city suitable to host such a conference.  Mr. George Yuen thanked the governments of host countries and their consuls-general in Hong Kong for organising such a high-level visit. “More Significantly, we have a great team in our successful endeavours to Europe as every body did an excellent job in conveying the right message. We all took part in useful discussions pivotal to future co-operation, business ties and educational exchanges. We will keep up our good efforts and build on our relations with opinion leaders, business community, research institutes, non government organizations overseas for the economic health and public well-being of Hong Kong” Mr. Yuen concluded. For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at telephone at (852) 2861-2622, fax at (852) 2861-3361 or by Email: kim_wan@betterhongkong.org End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Executive Summary of Strengthening HK’s Port and Trade

2003.10.30
Hong Kong’s port and sea trade sector has long enjoyed a considerable advantage through its privileged position as the gateway to and from China. Today, however, that advantage is waning. Growing competition from the development of South China ports is slowing Hong Kong’s growth. South China ports in Yantian and Shekou/Chiwan currently have structural advantages over Hong Kong in capturing exports from the Pearl River Delta. Given the importance of the port and sea trade to Hong Kong’s economy, this has serious implications. In the overall debate on how best to restore Hong Kong port’s competitiveness, however, the issues facing the sector have been oversimplified and a number of  common beliefs have arisen that are clouding judgment on the strategy required. Myths include:1. High terminal charges are the main cause of Hong Kong’s loss of traffic.2. More terminal operators are needed since the current limited number lowers Hong Kong’s competitiveness.3. Hong Kong needs to expand port capacity to capture a greater share of exports; this can be achieved by building Container Terminal 10.4. Hong Kong will benefit from additional throughput by focusing on transshipment traffic and offering dedicated berths to shipping lines. Although these beliefs do touch upon some of the key issues, they largely miss the point. The reality is different: Reality 1: Lowering terminal charges is not the solution. Terminal charges are not the main reason for higher costs of shipping out of Hong Kong. Instead, structural factors such as inefficiencies in crossing the border and higher trucking costs drive the cost differential. Reality 2: Increasing “competition” by adding more operators is unlikely to have much positive impact on Hong Kong’s port sector. The number of terminal operators in Hong Kong is similar to those in other leading global ports. Moreover it is not clear that adding terminal operators will be beneficial in terms of industry structure, quality of services or level of investment. Reality 3: Capacity expansion should be postponed unless and until Hong Kong can eliminate its structural disadvantages vis-à-vis Southern China. Before that happens, major investments in new terminal capacity will be risky. Hong Kong should instead focus on maximising the productivity of existing infrastructure. Reality 4: Trans-shipment is typically used to fill excess port capacity and should not be a primary focus for Hong Kong. Trans-shipment can build port volume but is less attractive to the local economy and more vulnerable to price competition from nearby competitors. While trans-shipment traffic is worth capturing in itself, it cannot justify heavy investment in new capacity. Furthermore, without additional direct traffic, dedicated berth arrangements simply transfer value from local ports to shipping lines. The physical flow of containers through the Hong Kong port has been the bedrock of the trade sector to date. While continued manufacturing growth in Guangdong will continue to drive overall port and sea trade growth in South China and Hong Kong, the development of ports in South China will increasingly challenge Hong Kong’s supremacy in physical traffic handling. Similar trends will eventually affect the airfreight traffic though Hong Kong’s current position is much stronger. To strengthen the Hong Kong port’s position in South China, Hong Kong needs to integrate itself further with the Pearl River Delta (PRD), position itself as part of a network of South China ports and target specific traffic segments. Simultaneously, Hong Kong should move its focus beyond the physical handling of traffic and capture value from other activities in the import/export sector. In other words, to further its prosperity in the trade sector, Hong Kong needs to move from a dependence on the physical flow of goods to the provision of skillbased value added services. Reasserting the competitiveness of Hong Kong’s port and sea trade sector will require progress along three broad directions:1. Build physical and policy bridges with the Pearl River Delta: Hong Kong should pursue cross-border integration both in policy as well as infrastructure to reaffirm its position as a leading player in the network of South China ports. Successful integration should significantly reduce the cost of trucking goods and improve barging services between Hong Kong and the western PRD. Coordination across South China ports on new development, similar to the A5 initiative on the airfreight side, is a forward-thinking step that the port sector can undertake. Such initiatives will also benefit the air freight sector which faces similar issues as well2. Identify and address “sticky” demand: Not all traffic is equal; some shippers explicitly choose Hong Kong port for its superior port services and are prepared to pay a premium for these. Hong Kong should differentiate these sub-segments of traffic and tailor services to meet their needs. Initiatives such as using bonded trucks to bypass cross border customs and direct marketing to buyers could improve the Hong Kongport’s attractiveness to imports and high value products.3. Move beyond the physical handling of goods to capture opportunities in other parts of the import and export value chain: Significant value can be captured in trade activities beyond physical cargo handling and so Hong Kong should think more holistically about the import and export value chain. For instance, Hong Kong should capitalise on global product sourcing trends, which are driving a large number of companies to increase their sourcing activities in Asia. To capture this opportunity, Hong Kong should upgrade its “software” (sourcing network, language skills, overseas market knowledge, etc) and position itself as an Asia (and not only China) sourcing hub. In summary, Hong Kong can still reassert itself as the leading port in South China, leveraging its distinct advantages that make buyers willing to pay a premium to ship from Hong Kong. However, as the infrastructure and networks of South China ports develop, Hong Kong will urgently need to address structural factors that are currently decreasing its competitive advantage. If this call to arms is ignored, Hong Kong will forfeit the opportunity to reassert its leadership both in South China and Asian trade. For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at telephone at (852) 2861-2622, fax at (852) 2861-3361 or by Email: kim_wan@betterhongkong.org End   The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong  Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Re-establishing Hong Kong’s Competitive Advantage by Refocusing on Value: Executive Summary

2003.08.06
An overall and sustained decline in Hong Kong’s economy has been exacerbated by the SARS crisis, which took a severe toll on many sectors of the economy already suffering the effects of recession.  The objective of our effort was to help develop a view on how SARS had affected Hong Kong’s economy in both positive and negative ways and to chart a course of action for its revival. We started our effort by gathering the views of Hong Kong’s opinion leaders on the opportunities and challenges in the post-SARS economy.  This drew out a clear concern: Hong Kong needs to address fundamental structural problems in its economy including rising unemployment and competition for investment form Mainland China.  It also needs to encourage growth by developing new sectors of the economy. We agree that Hong Kong faces these and other severe problems.  But we also feel that, in the general debate, these problems have been parlayed into a number of myths about the challenges facing Hong Kong, Obscuring the true danger: Hong Kong is losing its competitive advantage over other economies in the region.  At least three myths have arisen: 1.             Hong Kong’s role as an intermediary for trade and investment between China and the rest of the world is shrinking, creating high unemployment. 2.             Hong Kong is not competitive because its costs are too high and so it needs to further bring cost down. 3.             Hong Kong’s economic decline is irreversible. Our task is to dispel these myths and focus instead on the following realities: 1.             Reality 1: Hong Kong must deal with the challenges of a maturing economy like many other similar economies:  While the threat does exist, a substantial reduction in Hong Kong’s intermediary role (disintermediation) has yet to materialize.  Also, while high unemployment is often associated with disintermediation, in reality it is not driven primarily by competition from China.  Much of the unemployment in Hong Kong is caused by structural and cyclical changes as Hong Kong matures into a high-value services economy.  In fact, Hong Kong’s experience is consistent with that of many other mature service economies. 2.             Reality 2: Hong Kong must focus on delivering value as its true source of advantage: Hong Kong can never compete with China on cost factors.  Its distinctiveness lies in delivering value.  Hong Kong should work to maintain its quality premium over competitors. 3.             Reality 3: Hong Kong can reverse its fortunes: The challenges Hong Kong faces are not insurmountable or unique to our economy.  Hong Kong can revive its economy through determined action to address its problems. We therefore believe that a series of actions are needed to restore our competitive advantage.  Hong Kong must focus on delivering value to businesses- its true source of distinctiveness.  In this report, we offer a direction for efforts to restore and strengthen competitive advantage. Fulfilling World-Class City Aspirations We benchmarked Hong Kong against four other international cities: London, New York, Singapore and Shanghai.  We also assessed it against 30 different economic and social indicators, developed from local city and some international survey data, for instance, from The Heritage Foundation and the International Institute for Management Development.  In doing so, we focused on two dimensions of attractiveness: “hardware” and “software”.  The analysis showed that a world-class metro meets certain conditions in terms of “hardware” components and “software” elements.  Hong Kong scores well on some of these and less well on others. The two hardware components are: 1.            Business: A world-class city has a world-standard financial and business centre, and internationally competitive services industry, a logistics hub for international trade and commerce, a free-trade economy and a research and development sector. 2.            Non-business: A world-class city has private and public healthcare of high standards.  It is an unrivalled gateway to particular region.  It has an excellent transportation and communications system and is committed to urban planning. Software elements are: 1.            Education: The city has a highly skilled workforce and an education system of a high standard. 2.            Environment: The city is safe and has a low crime rate.  The environment is clean and housing quality is high.  The living environment is attractive, offering an international lifestyle in terms of nightlife, shopping and other leisure elements. 3.            Social infrastructure: The population is ethnically and culturally diverse.  The city has vibrant arts centre.  It is committed to the rule of law, and offers free flow of information, freedom of expression, a level playing field and a corruption-free government. Hong Kong first needs a wholesale change in mindset. To succeed in a large number of economic sectors, it should focus on a shortlist of specialized areas around which to drive efforts.  In addition, Hong Kong should increase physical integration with China while also differentiating itself on the following factors: rule of law, corporate governance, economic freedom, and a vibrant culture and arts scene.  We suggest actions in three broad directions: 1.             Developing deep rather than broad economic sectors: Hong Kong should select areas in which it can sustain or create a competitive advantage and build critical mass around selected clusters of economic activity. 2.             Attracting talent, not money: To succeed, the clusters will need the right kind of talent.  Hong Kong should focus on attracting three types of outside talent: Mainland Chinese, Asia-Pacific’s best and brightest, and Overseas Chinese. 3.             Fulfilling world-class city aspirations:  For the clusters to thrive and for talent to come to Hong Kong and stay here, Hong Kong also needs to become a truly world-class city.  This requires more than stating the aspiration; Hong Kong must also fill current gaps with other world-class cities in the areas of the environment, education and culture/arts.  In parallel, it should strengthen and protect existing areas of distinctiveness: the legal system, financial institutions and capital markets, economic freedom, and transportation infrastructure. Concluding Remarks Economic performance may have weakened since 1998 but Hong Kong’s fundamentals are still strong.  The increasing economic pressures the city faces, particularly following the SARS crisis, should be recognized for what they are:  a wake-up call to rebuild Hong Kong’s competitive advantage. The way forward is to focus on economic success in selected areas where Hong Kong can truly differentiate itself.  Finally, success will require determined action by committed and well-supported leadership.  Without this, no initiative to improve Hong Kong’s economy will succeed. For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861-2622 or by fax at 2861-3361. End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Worldwide Campaign Sending 100,000 e-Mails and e-Cards to Brighten Hong Kong

2003.05.28
  www.brightenhk.org.hk “BrightenHK Campaign” Co-Organizer List Ambassador List   The Better Hong Kong Foundation, The Internet Professionals Association (iProA), The Outstanding Young Persons’ Association, and the World Trade Centres Association have jointly organized the BrightenHK Campaign. The campaign aims to unite Hong Kong people and boost confidence against the impact of SARS. (Severe Acute respiratory Syndrome)  This campaign will optimise the use of the www.BrightenHK.org.hk portal to inform the world of accurate and positive information about Hong Kong, in order to re-enforce Hong Kong’s international image.   Mr. George Yuen, Chief Executive of the Better Hong Kong Foundation, said, “There are some of our overseas friends, political leaders and corporate CEOs who do not have an update picture of what Hong Kong is doing in combating SARS. We hope this campaign can help spread out to the world in order to enhance communication between Hong Kong and the international community, so as to rebuild our position in the world and help revive our economy.”  The BrightenHK Campaign has the support of over 20 local and overseas chambers of commerce in Hong Kong, as well as almost 200 business associations and non-governmental organizations. In the next few weeks, members of participating organizations will send out to their business associates and friends e-mails and e-cards promoting the portal. The portal describes Hong Kong’s hygiene condition, disease control measures, medical research and the economy revival activities will be presented to overseas countries with a comprehensive update on Hong Kong to avoid misunderstanding and dispel misconception.  The Convener of BrightenHK Campaign, President of iProA, Dr. Elizabeth Quat, said, “The borderless nature of the Internet is most desirable for organizing a worldwide promotion for Hong Kong. It is the most efficient and time critical way to spread out positive information and help neutralize the effects of negative reports about the SAR.”   “The participating NGOs and organizations will encourage their members to send e-cards overseas through www.BrightenHK.org.hk,” Dr. Quat added, “we expect 100,000 e-cards about Hong Kong’s work against SARS would be sent out in the first two weeks of the campaign. We shall keep a record of all browsers of our e-Cards in the database for future promotion of Hong Kong. We are confident in collecting over 10 million email accounts within 6 months.” In the mean time, there will be a series of related activities to unite Hong Kong people to face up to   atypical pneumonia.  The general public will be encouraged to send e-cards overseas whilst the travel and commercial industries will call for overseas businessmen and tourists to come back to Hong Kong. There will be a slogan and essay competition to encourage active healthy living through positive thinking. ‘Born Again’ activity is to distribute bookmarks with aspiring messages from people who have recovered from such traumatic experiences. There will also be concerts by renowned musicians to rekindle the spirits of Hong Kong people.  “We hope the BrightenHK Campaign can help all of us in Hong Kong to be positive again about our future, and work together for a better environment, a better Hong Kong.” Said Mr. George Lung, Chairman of the Outstanding Young Person’s Association.  “As a member of the Hong Kong commercial sector, our association gives the full backing to the BrightenHK Campaign. We hope this can revitalize Hong Kong’s economy, and reenergize this international city.” Said Miss Annie Wu, Chairman of the Executive Committee of the World Trade Centres Association Hong Kong, which has 750,000 members in over 300 cities across the world.  This territory-wide promotion will be launched in two phases. The first phase will begin on 20 May 2003, which aims to actively spread positive and accurate information of Hong Kong about its combat on SARS. The second phase will start after the containment of the disease. This phase will concentrate on sending of a new round of e-mails and e-cards by members of participating organisations to invite overseas businessmen and tourists to visit Hong Kong.  “SARS has affected Hong Kong as an international commercial city. We hope that the campaign can rally strong public support in a very short time, so as to show to the rest of the world our unity and our commitment in building a better Hong Kong.” Concluded Mr. Yuen, CEO, Better Hong Kong Foundation.  Together We BrightenHK Online!  Background The SARS outbreak has shaken our confidence in society and brought distance between people.   This is partly attributable to the confusion and lack of positive information in the public media.  If accurate and positive information can be consolidated by quality reporting and made available for easy access by the general public, local as well as overseas, then much of the fear will have proved unnecessary although proper precaution is still indispensable.    We need to bring the complete picture to the general public so that people can judge for themselves how they can lead an active yet healthy life under the circumstances and hence have their confidence restored.  The “BrightenHK Campaign” aimed at addressing this need with actions for economic recovery of Hong Kong through global network online promotion. Initiated by the Internet Professionals Association (iProA) together with The Outstanding Young Persons’ Association, with the support of The Better Hong Kong Foundation and the World Trade Centers Association. It is proposed that a portal be built as the centre stage of a global promotion campaign for Hong Kong. It will bring together SARS related news worldwide and links to all relevant resources – medical advice, social support, psychiatric consulting, messages from relevant government departments and associations. A series of programmes will be launched along with the portal to encourage participation by the general public so that they can bring the message of healthy active living home.  The Campaign will encourage attention towards what Hong Kong people have learned and gained in this experience rather than focus on the unfortunate loss of life, stress on the economy or constrains on personal freedom more commonly found in the public media. We believe that this is the best time to recreate our values, rebuild our confidence and reposition Hong Kong. We have to well prepare ourselves for the recovery and lead a healthier life.  Campaign Objectives –         Make use of the powerful Internet Community to conduct a massive yet cost effective public relations programme to bring Hong Kong people closer together in a joint effort to fight SARS and its aftermath –          Broadcast facts and positive news about Hong Kong to the international communities –          Dismiss rumors and uncertainties –         Help create positive views –          Strengthen international visitors’ confidence in Hong Kong –          Attract tourists and business visitors back to Hong Kong once we have recovered –          Encourage People of Hong Kong to recreate our values, rebuild our confidence and reposition Hong Kong to prepare for the recovery and lead a healthy life Actions Planned 1.     Campaign Slogan & Essay Student Competition – to encourage active healthy living through positive thinking 2.     E-Card Across the Ocean – to promote Hong Kong people’s commitment and confidence to fight SARS to relatives/friends/co-workers abroad by sending e-card with positive messages 3.nbsp;      NetCare Campaign – to boost the will of SARS patients and affected hospital staff by providing video conferencing facilities for easy visiting by their family 4.       Born Again Bookmarks – distribute bookmarks with encouraging messages from people who recovered from traumatic experiences 5.       BrightenHK Concerts – 8 Concerts by renounced musicians to raise the spirit of Hong Kong people.  The concerts will also be broadcasted worldwide via the Internet so that more people will benefit from them. 6.       Active 123 –        to encourage healthy life style with sports activities 7.       BrightenHK Online Promotion – to promote Hong Kong to overseas visitors in co-operation with travel related industries via email We welcome ideas on how we can help speed up the recovery.  Please forward your suggestions to the Campaign Convener, Dr. Elizabeth Quat, at (852) 2778 0040 or email eq@iproa.org.  Come join us in the work for a brighter tomorrow! About The Better Hong Kong Foundation The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Major EU and US Business Organizations Join The Greater Pearl River Delta Alliance

2003.02.20
The Better Hong Kong Foundation was delighted to announce that two leading international business organizations, the Brussels-based International Public Affairs Centre (IPAC) and the Chicago-based Association for Corporate Growth (ACG) have joined the alliance to forge close economic relations with the Greater Pearl River Delta region. “The joining of these two premier global associations to the alliance is an eloquent testimony to the growing importance of Greater Pearl River Delta in the eyes of the international business community.”  said Mr. George Yuen, Chief Executive of the Foundation. “One of the primary objectives of the alliance is to promote international connectivity for the Greater PRD including Hong Kong. I am much encouraged with the support we received from various partners. It shows that the efforts by the private sector are absolutely pivotal in promoting the region.   Clearly, the HKSAR Government, the Guangdong Government and various municipalities have essential roles to play.”  Mr. Yuen added. Daniel Fung, Chairman of the East West Strategic Development Commission (ESTRADEV) remarked: “With the support of the IPAC and the ACG, the Commission and its partners can be actively engaged in establishing essential dialogue between the international business community and the Greater Pearl River Delta so as to facilitate economic growth there.   We are confident that closer economic relations between business community, especially small and medium size enterprises and the GPRD will bring prosperity to the region and create job opportunities to Hong Kong and Guangdong.” Established on January 23rd, 2003, the Alliance has already secured pledges of support from the Guangdong Association for International Cultural Exchange, the Trade & Investment Office of the State of California, the International Chambers of Commerce and the Committee on China Research & Development in the Chinese University of Hong Kong and other industry associations. Also present in the meet-the-media session were Dr. Marc Battaille, President of IPAC and Mr. Jack Chen, Asia-Pacific Director of ACG. Dr. Battaille briefed the media about the International Public Affairs Centre.   “IPAC is an international association of corporate Chairman and CEO’s who examine public issues that affect the economy development and develop positions which reflect sound economic and social principles. Established in Brussels 1978, IPAC was founded in the belief that business executives should take a proactive role in initiating and pursuing public policy dialogue with government, both in developed and developing markets, with a view to promoting economic growth.“ Dr. Battaille said. “IPAC will be leading a major EU Investment delegation to Hong Kong and the Greater Pearl River Delta this autumn. European interest in the China market is growing by leaps and bounds. The visit will crystallize business opportunities both for and in the region.” Added Dr. Battaille. IPAC’s association with Hong Kong went back to March 1997 when it co-organized with the Hong Kong Government and the Commission of European Union the 1997 CEO Summit in Hong Kong – “A Model of Economic Efficiency”. Mr. Jack Chen followed by introducing the Association for Corporate Growth. Mr. Chen said: ”Founded in Chicago 1954, ACG is the premier association for and about professionals involved in small-medium size corporate growth, corporate development, and mergers and acquisitions. It promotes the professional interests of its members, who have assumed leadership roles in strategic corporate growth, by offering a forum for quality programs, education and networking. ACG has nearly 6,000 members representing approximately 2,500 companies in 39 chapters throughout the United States, Canada, the UK and Mexico. Four new chapters are in formation in the United States and Europe. “ “More importantly, we are in the process of launching a Hong Kong/GRPD Chapter of ACG later this spring. This will help put GRPD on the world business map”, added Mr. Chen. “Hong Kong would certainly benefit from the rapid growth in the Pearl River Delta and great potential in the rest of Guangdong province and beyond. The Foundation will continue to work with various local and overseas organizations to promote the region to the international marketplace through Hong Kong”. Mr. Yuen concluded. “GREATER PEARL RIVER DELTA ALLIANCE” PRESS CONFERENCE Programme and Activities February 14th, 2003                               Joint briefing with ESTRADEV of Dr. Richard Bush, Director of Northeast Asia Center of Brookings Institute, Washington DC and planning seminar on Hong Kong/Greater Pearl River Delta February 15th – 17th, 2003                     Briefing US Congressional delegation on the Hong Kong/GPRD economic integration February 22nd – 23rd, 2003                    Joint planning session in Guangzhou with ESTRADEV and Guangdong Association for International Cultural Exchange on GPRD promotional campaign February 25th, 2003                               Briefing Ms. Lisa Stephenson, Director of Graduate Student Career Development, George Washington University with job opportunities for American MBA graduates in Hong Kong/GPRD March 26th – March 29th, 2003            Leading senior US journalists delegation’s visit to GPRD Mid-April ‘03                                        GPRD Road Show co-organized with the Hong Kong Productivity Council plus culinary presentations May/June ’03                                        Inauguration of Association for Corporate Growth (ACG) Hong Kong/GPRD Chapter June 25th-27th, 2003                               Co-sponsoring Hong Kong International Film & TV Market (FILMART) with invitation to Guangdong film industry June 27th, 2003                                       Co-sponsoring with ESTRADEV inaugural “Hong Kong Dinner” at the Salzburg Seminar, Salzburg, Austria Late-October ’03                                  Co-sponsoring with ESTRADEV major IPAC investment delegation’s visit to Hong Kong/GPRD Early-November ’03                             Leading Hong Kong/GPRD business delegation’s visit to the European Union: Brussels, Milan, Rome, Paris & London. Early-November ‘03                             Co-sponsoring with ESTRADEV donation of “Pearl River” piano to leading European orchestra Spring ’04                                              Leading with ESTRADEV Hong Kong/GPRD business delegation’s visit to the United States   For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861-2622 or by fax at 2861-3361. – End – The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Greater Pearl River Delta Alliance

2003.01.23
The Better Hong Kong Foundation takes the lead to rally the support of a wide range of non-government and non-profit organizations to form a broad alliance, to promote the Pearl River Delta (PRD) to the world through Hong Kong.  This alliance, spearheaded by the East-West Strategic Development Commission (ESTRADEV), chaired by Mr. Daniel R. Fung, has secured pledges of support from the Mayors’ Association of China, the Guangdong Association for International Cultural Exchange, the Trade & Investment Office of the State of California, the Chicago-based Association for Corporate Growth and the Committee on China Research & Development Chinese University of Hong Kong as well as International Chambers of Commerce and various industry associations. To announce the setting up of the alliance, Mr. George Yuen, Foundation’s Chief Executive, introduced the alliance, being wholly apolitical and non-profit oriented, with its mission on: 1.            Fostering government-to-business dialogue as between Hong Kong, Guangdong and the international business and investment community; 2.            Leading trade missions and securing overseas market access for Hong Kong/Greater PRD companies; 3.            Fostering inbound investment flows into the Greater PRD through Hong Kong; 4.            Launching an integrated multi-media promotional campaign for the Greater PRD including Hong Kong; 5.            Enhancing international connectivity for the Greater PRD including Hong Kong. Mr. Yuen asserted: “The positioning of our alliance is crystal clear.  Our main task is to facilitate contact and exchanges by Hong Kong and Guangdong businesses with their overseas counterparts.  Of equal significance will be the alliance’s networking prowess in both public and private sectors in Hong Kong, Guangdong, United States, Europe, Australia and other overseas markets.  We will work closely with the Hong Kong Trade Development Council, Hong Kong Productivity Council, Invest Hong Kong and relevant government bureaus and departments as well as with overseas business organizations and think-tanks to ensure success of our efforts.”  Mr. Daniel Fung, Chairman of the East West Strategic Development Commission (ESTRADEV) remarked: “We specialize in fostering government-to-business dialogue to facilitate growth in developing economies.  Ever since ESTRADEV’s inception in 1999, we have worked closely with other non-profit bodies including, in particular, the Brussels-based International Public Affairs Centre (IPAC) in leading trade missions to and fostering inward investment flows into such diverse developing markets as India, Kazakhstan and the Czech Republic.  With the value added of the International Chambers of Commerce in Hong Kong , Mayors’ Association of China, the Guangdong Association for Cultural Exchange, the California Trade and Investment Office and the Association for Corporate Growth (ACG), we are confident that we can bring this project to success so as to ensure that Greater Pearl River Delta companies including those in Hong Kong can all share in the fruits of increasing globalization.” Mr. Yuen concluded: “We have to institutionalize the alliance’s structure and mode of operation for sustainable corporate growth.  This involves collaboration among partners with close coordination of our activities.  There will be committees by industries and activities convened by core member associations.” Also present at the press conference were Mr. Clement Chan, Chairman of the International Chambers of Commerce Pearl River Delta committee, Mr. Fred Wang, Overseas Representative of the Mayors’ Association of China (Information & Publicity), Ms. Janie Fong, Director of the California Trade and Investment Office (Hong Kong/China) and Professor Chyau Tuan, Chairman of the Committee on China Research & Development, the Chinese University of Hong Kong. The Press ConferenceSpeakers List: Mr. George Yuen, Chief Executive, The Better Hong Kong FoundationMr. Daniel Fung, Chairman, East-West Strategic Development CommissionMr. Clement Chan, Chairman, International Chambers of Commerce Pearl River Delta CommitteeMr. Fred Wang, Overseas Representative, Mayors’ Association of China (Information & Publicity)Ms. Janie Fong, Director, California Trade and Investment Office (Hong Kong/China)Professor Chyau Tuan, Chairman, the Committee on China Research & Development, the Chinese University of Hong Kong End   For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861-2622 or by fax at 2861-3361. The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Policy for Fostering Economic Integration Between Hong Kong and Pearl River Delta Urged

2002.12.05
A survey by the Chinese University of Hong Kong with the support of the Better Hong Kong Foundation shows over 80% of the manufacturers and nearly 60% of services provider interviewed reported growth in business as a result of cross border investment and relocation of industrial bases. The research reveals that the HKSAR administrations should develop a comprehensive policy to support small and medium-size enterprises to facilitate research and development activities of local business in order to further develop tourism and logistics related industries, and to maintain a sustainable economic growth in the territory and the Pearl River Delta. The 2002 survey aims to review and evaluate the operational issues facing Hong Kong manufacturing and logistics related service industries. The survey indicates that Hong Kong authorities should design and implement measures or policies conducive to faster and more efficient flow of passenger and cargo traffic. The administration should further encourage more liberal human capital, resources and information flows. The authorities¡¦ should also push for an early implementation of closer economic relations arrangement. (Table 1) Professor Chyau Tuan, Chairman of the Committee says, ¡§The economy between Hong Kong and the Pearl River Delta has become more and more integrated since China¡¦s open door policy in the 1980¡¦s. The economic growth in Hong Kong and Guangdong, especially in recent years, manifests the importance of interactivities in the region within the sphere of the ¡¥core-periphery system¡¦. Such a mega city economy is so unique and becomes the comparative advantage in mobilized FDI for the region.¡¨ The survey was conducted between July and August 2002, with questionnaire sent to 4,442 manufacturing and logistics-related (trading, transport, storage, business services, information, etc.) companies registered in Hong Kong. A total of 192 questionnaires were returned, constituting a response rate of 5%. Among them, 70 were in the manufacturing and 122 in services business. Major Findings The survey indicates that cross-border investment have great impact on Hong Kong¡¦s economy. 87.3% of the manufacturers said both value of production and sales volume had been increased since relocation of manufacturing process began. The logistics related operations reported an increase of 56.3% in business. On the question of how much cross border production had directly affected employment in Hong Kong, 37% of the logistics and related servicing companies interviewed had hired more people as permanent staff; and 46% said the number of local staff remained unchanged; whilst 17% reported a decrease. For the manufacturers interviewed, 34% had increased employing local staff; and 2% reported no change but 64% stated a decrease. On the parts of work skills required for their local employees and value added created by their local operations, different industries presented varied views. Concluding remarks ¡§The survey has deepened our understanding of the effects of economic integration between Hong Kong and the Pearl River Delta Region throughout these years. It provides clear directions for future development in the region and for policy of SAR government to enable such a development. Hong Kong needs to strengthen its competitiveness and to leverage its superior economic fundamentals (such as institutional infrastructure, global networking and openness of society, etc.) for continuous growth. The HKSAR government has a critical part to play. We support the administration¡¦s efforts to remove snarls that complicate traffics and commerce; to facilitate movement of goods and services and to foster an even freer flow of capital, human resources and information between Hong Kong and the region. The Foundation will continue to work with various organizations for a closer Hong Kong-Pearl River Delta economic symbiosis.¡¨ concluded Mr. George Yuen, Chief Executive of The Better Hong Kong Foundation. For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861 2622 or by fax at 2861 3361. Table 1 The Expectations on HKSAR Economic Policy (%)   Manufacturing Industry Logistic Services (1) To Implement a positive and comprehensive policy for SMEs (including financing, market information, trade promotion, and training) 62.32(Remarks) 52.54 (2) To Speed up the two-way exchange of people, materials, capital and information between Hong Kong and the Pearl River Delta Region 47.83 49.15 (3) To hasten the development of a “Closer Economic Partnership Agreement” between Hong Kong and the mainland 41.43 40.68 (4) To enable closer coordination in the economic planning and decision-making between Hong Kong and the Guangdong Province 36.23 40.68 (5) To implement a positive and comprehensive industry policy (foster selective industries to engage in R&D) 30.43 29.66 (6) To eliminate monopoly and increase market competition 23.19 37.29 (7) Others 5.71 14.41 Remarks: Multiple answers and the total percentage may exceed 100% The manufacturing business and all related to providing logistics services are calculate separately Samples Distribution: 70 manufacturing business and 122 services provider business   End  

The Better Hong Kong Foundation Partner with Influential U.S. Think Tank to Better Hong Kong – U.S. Relations

2002.08.22
The Better Hong Kong Foundation and the U.S.- Asia Institute organize the 50th Congressional Staff Delegation to China and the 20th to Hong Kong from August 19-21. Since its inception in 1995, the foundation has been working closely together with the US-Asia Institute in promoting a better understanding between the U.S. and the Hong Kong SAR. The delegation to Hong Kong marks an important event on the U.S.- Asia Institute chronicle and it also symbolizes a milestone of strong partnership between the two organizations. The delegation have been in China from August 12- 18, 2002 before they arrive Hong Kong for a 3-day study mission on August 19. During their visit, meetings are scheduled with key members of the SAR Government and business leaders. (programme enclosed). The Congressional Delegation, comprising 10 high-ranking Congress and Senate staffers. Through sharing their personal observations and experiences, they hope to foster a greater understanding of China and Hong Kong, through dialogues and meetings with key HKSAR policy makers and business community. The delegation also examines Hong Kong’s “one country two system” mode of administration in respect of the rule of law, freedom of the press, clean government, and efficient and effective open market. They also take time in meeting people and visiting places on their own, so as to have a first-hand experience of the way and quality of life in Hong Kong. About the US-Asia Institute: Founded in 1979 by Esther G. Kee and Joji Konoshima, the US-Asia Institute is a private, non-governmental organizations. It was established to promote dialogue on international issues of common interest to the United States and the countries of Asia. It achieves this goal by striving: * To promote better understanding between the U.S. and Asia;* To conduct work visits for American legislators, senior congressional staff members, and other so they can meet their Asian counterparts and vice versa;* To maintain close ties with the Asian diplomatic missions accredited to the U.S., with members of Congress and their staffs, with other government agencies, and the private and academic sectors, cooperating/consulting with them on matters of mutual interest;* To organize international conferences and symposiums in the U.S. and Asia on political, economic and security topics, giving voice to the broadest spectrum of viewpoints for discussion;* To host small, off-the-record gatherings of American and Asian officials, business and academic leaders, providing invaluable opportunities for frank discussion and a candid exchange of views.   About the Congressional Delegates: Mr. Mark Brown, DELEGATION LEADEROffice of Congressman Tim Roemer (Democrat, Indiana) Mr. Francis T. MikoCongressional Research Service Mr. Daniel ArcherOffice of Senator Chuck Hagel (Republican, Nebraska) Mr. Joseph Pinder IIHouse Committee on Financial Services Mr. Rock CheungSenate Committee on Budget Mr. James SakaiOffice of Senator Daniel Akaka (Democrat, Hawaii) Mr. Eric EikenbergOffice of Congressman Clay Shaw (Republican, Florida) Mr. Andrew ShapiroOffice of Senator Hillary Clinton (Democrat, New York) Mr. Scott Feeney House Committee on Government Reform Mr. William WickerSenate Committee on Energy For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861 2622 or by fax at 2861 3361. End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Hong Kong Economy to recover slowly

2002.07.03
The Hong Kong economy is expected to continue to recover from the downturn since the second half of 2001. The output growth is projected to be positive in the second and third quarter this year. Reversing the declining trend, the rebound of the economy will be relatively modest. This is according to the High Frequency Macroeconomic Forecast carried by the APEC Study Center of The University of Hong Kong, with its system developed in collaboration with Nobel Laureate Professor Lawrence Klein of the Wharton School of Business of the University of Pennsylvania. The real GDP is estimated to increase by 0.9% in the second quarter of 2002 on a year-on-year basis, rebounded from the 0.9% drop in the first quarter. In the current quarter, real GDP is forecasted to grow by an annual rate of 1.5%. This series of quarterly forecasts commissioned by the Better Hong Kong Foundation aims to provide the best possible quantitative understanding of the macro-economic environment in Hong Kong. The Foundation’s Chief Executive Mr. George Yuen said, “It’s gratifying to see a marginal increase of 0.9% in the second quarter 2002, as an early sign of a slow economic recovery. As we enter in the second half of the year, we expect a 1.5% growth in real GDP. However, the strong growth of the US economy at 5.6% in the first quarter is expected to moderate. The economic outlook is clouded by conflicting signals, but on balance the US economy is unlikely to contract in the current quarter.” Forecast Highlights Professor Richard Wong and Dr. Alan Siu of the APEC Study Centre of the University of Hong Kong presented the following highlights: Private consumption spending dropped by 0.6% in the first quarter of 2002, and is expected to fall by 0.2% in the second quarter, but starts to grow by 0.1% in the third quarter of 2002, on a year-on-year basis. In April, the volume of retail sales shrunk by 1.6% compared to a year ago, but is expected to pick up in the next half of the current year. The number of visitor arrivals maintained a double-digit growth for fourth consecutive months at 17.4% year-on-year in April. The number of visitors from the Mainland China rose sharply by 49.9% in April compared to a year ago. As a result, 37.5% of visitors are now from the Mainland, as opposed to 27.0% last year. Hopefully this could liven up the retail business further. The exports of services are projected to grow by 5.9% and 5.3% in the second and third quarters of 2002 respectively. The recovery of Hong Kong economy is reflected by moderate increase in the imports of goods. Telecommunication, sound recording, office and automatic data processing machines grew the fastest in April. The imports of goods are estimated to increase by 0.5% and 0.4% in the second and third quarter of 2002 respectively. The US economy rebounded strongly in the first quarter of this year, growing by 5.6%. Re-exports to the United States grew by 7.8% in April, while re-exports to mainland China rose by 8.6%, both on a year-on-year basis. Re-exports of goods is expected to grow by 4.3% and 4.7% in the second and third quarters of 2002. Domestic exports continued to contract, dropping by 12.7% in the first quarter of 2002. In April, the fall in total domestic exports was 17%, with domestic exports to the Mainland China, Unites States and United Kingdom, declined by 9.6%, 20.8% and 17.7% respectively on a year-on-year basis. These three major destinations of Hong Kong domestic exports of goods accounted for 60% of the total drop. A further decline in domestic exports is expected, but more slowly due to the weakening of the US dollar in recent months which would help to boost Hong Kong’s competitiveness. The drop in domestic exports is expected to decelerate to -10.6% in the second quarter and -7.2% in the third quarter of 2002. Given the uncertain business environment, investment spending on machinery and equipment shrunk by 25.0% in the first quarter of 2002 on an annual basis. It is forecasted to contract by 14.4% and 19.4% further in the second and the third quarter of 2002. Investment in land and construction dropped by 3.7% in the first quarter of 2002. The slowdown is expected to persist. It is forecasted to decline by 5.1% in the second quarter and by 4.1% in the third quarter of 2002 on a year-on-year basis. Deflation pressure is expected to continue. In May, the composite CPI declined by 3.1%, with about 1 percentage point of the fall accounted by the one-off drop in utility rates Durable goods prices registered the second largest decrease at 7.2%, while the price index for clothing and footwear increased by 2.3%. The deflation rate is forecasted to be 3.1% in the second quarter of 2002 and 3.7% in the third quarter of 2002. The provisional seasonally adjusted unemployment rate in March to May climbed to a historic high level of 7.4%. The median duration of unemployment also increased from 82 days in fourth quarter of 2001 to 87 days in the first quarter of 2002. Reflecting the continued slack in the property market, unemployment is still concentrated in the construction sector, with unemployment rate at 15.7% in first quarter of 2002. The current high level is expected to continue. The unemployment rate is forecasted to be 7.4% in the second quarter of 2002 and 7.7% in the third quarter of 2002. Echoing the presentation by Professor Richard Wong and Dr. Alan Siu of the APEC Study Centre of the University of Hong Kong Mr. Yuen concluded: “Buoyed by the still robust consumer spending in the United States, Hong Kong can still rely on its total exports of goods and services as its engine of growth, pulling the economy to grow at an expected rate of 1.5% in the current quarter. Given the deflationary and high unemployment environment, private domestic spending will continue to remain weak. In our recent visit to the Pearl River Delta region, we believe its vast development potential and substantial growth in double digits should provide greater business opportunities for Hong Kong companies. This further reasserts the importance of an even earlier economic integration of Hong Kong and the Pearl River Delta, contributing to the economic growth in the region. The High Frequency Macroeconomic Forecast for the third quarter of 2002 will be announced in early October. The quarterly forecasts can be accessed at http://www.hku.hk/apec/cqm/ and http://www.betterhongkong.org. For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861-2622 or by fax at 2861-3361. End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

State Department Issues Annual US-HK Relations Report

2002.04.20
As stipulated in the US-Hong Kong Policy Act of 1992, the US State Department issued its annual report on US-Hong Kong relations on April 10th, 2002. The report concluded that Hong Kong “remains one of Asia’s freest cities, with the Hong Kong government committed to preserving Hong Kong’s distinct way of life.” The report praises Hong Kong’s support for global anti-terrorism efforts and covers a range of developments affecting US interests in Hong Kong, including the preservation of their autonomy; progress toward greater accountability and democratization of the political system, protection of civil liberties; and a strong rule of law. Edward Yau, the Director General of Hong Kong Economic and Trade Office, said he was pleased with the report commenting that “there is clearly a keen US interest in seeing Hong Kong keeping its distinct position with its freest economy, the rule of law, an independent judiciary and a robust system for customs control.” UNITED STATES-HONG KONG POLICY ACT REPORTas of March 31, 2002 As Required by Section 301 of the United States-Hong Kong Policy Act of 1992, as amended by section 586(a) of the Kenneth M. Ludden Foreign Operations, Export Financing, and Related Programs Appropriations Act, 2002, Pub. L. 107-115. 22 U.S.C. 5731 TABLE OF CONTENTS I. SUMMARYII. BACKGROUNDIII. U.S. INTERESTS IN HONG KONGIV. SIGNIFICANT DEVELOPMENTS AFFECTING U.S. INTERESTS IN HONG KONG (8/1/01 – 3/31/02) A. Anti-Terrorism CooperationB. AutonomyC. Political SystemD. Civil LibertiesE. Judicial and Legal DevelopmentsF. Bilateral AgreementsG. Suspensions under Section 201(A), Terminations under Section 202(D), or Determinations under Section 201(B) V. US-HONG KONG RELATIONS (8/1/01 – 3/31/02) A. Economic-CommercialB. Export ControlsC. Law Enforcement Cooperation, Extradition, and Mutual Legal AssistantD. U.S. Military Ship and Plane VisitsE. Passport and Visa RegimeF. Cultural, Educational, Scientific, and Academic Exchanges I. SUMMARY Hong Kong under Chinese sovereignty remains one of Asia’s freest cities, with the Hong Kong government committed to preserving Hong Kong’s distinct way of life. Since the terrorist attacks of September 11, the Hong Kong government has provided strong support for global anti-terrorism efforts. With some notable exceptions discussed in previous reports, the Government of the People’s Republic of China (PRC) has generally kept its commitments to respect Hong Kong’s high degree of autonomy. In the period from August 1, 2001 to March 31, 2002, Hong Kong remained a free society that extended basic civil liberties to its citizens every day, largely defined its identity in terms of being an open international city, and continued to make its own decisions in pursuit of its own identity and economic interests. Reflecting a trend toward greater economic interaction between Hong Kong and the Mainland, the reporting period was marked by increasing local pressure on the government to help business capitalize on economic opportunities in the Chinese mainland, including by streamlining the flow of goods and people across the Hong Kong-Mainland border. While such a development is a natural consequence of the opportunities created by China’s continued economic opening, the move toward deeper economic interaction with mainland China could pose new challenges to maintaining Hong Kong’s autonomy and separate customs and border controls. During the reporting period Chief Executive C.H. Tung and other senior government officials publicly and repeatedly stated their strong support for the global anti-terrorism campaign. Hong Kong has fully implemented or is taking steps to comply with applicable United Nations anti-terror resolutions. Hong Kong’s regulatory authorities directed financial institutions to conduct searches for terrorist assets using U.S. and UN lists, and those institutions have found no such assets. U.S. law enforcement agencies received excellent cooperation from their Hong Kong counterparts. Through its presidency of the multilateral Financial Action Task Force (FATF), Hong Kong also played a lead role in disrupting terrorists¡¦ financial networks. Hong Kong’s civil service remained independent, and many officers initially appointed to senior post by the British continued to serve in key posts. Hong Kong’s export control system remained robust. Hong Kong continued to play an important role as an international finance center, actively participating in efforts to address the threat of terrorist financing in the wake of September 11. The Hong Kong press remained free and continued to comment critically on issues, including the PRC and its leaders, and the Hong Kong government. Demonstrations – often critical of the PRC – continued to be held. The Falun Gong remained legally registered and its members generally remained free to practice, proselytize, and protest against PRC policies, although the group’s inability to secure public or private facilities to hold its annual international conference raised concerns about the government’s commitment to supporting a climate of respect for the group’s freedom of assembly. Mainland Chinese companies were subject to the same laws and regulatory supervision as all other enterprises. Hong Kong’s Independent Commission Against Corruption (ICAC) successfully prosecuted several Hong Kong officers of mainland companies. The rule of law and an independent judiciary remained pillars of Hong Kong’s free and open society. Concerns about the ultimate authority of Hong Kong’s highest court continued to linger over the potential re-use of a mechanism employed by the Hong Kong government in 1999 in the “Right of Abode” case that brought about an ex post facto reinterpretation of the Basic Law by the National People’s Congress Standing Committee. U.S. military ship and aircraft visits to Hong Kong, for the most part, were approved by the PRC, bolstering Hong Kong’s reputation as an open, cosmopolitan, and internationally connected city. At the very end of the reporting period, however, the PRC denied a U.S. Navy ship visit request. Hong Kong’s autonomy as an international economic actor remained intact as it actively (and independently of the PRC) participated as a full and active member of numerous international economic organizations, such as the World Trade Organization, the Asia Pacific Economic Cooperation forum, and the Financial Action Task Force, in which membership is not based on statehood. There was continued public pressure on Hong Kong’s political system to evolve toward greater accountability and democratization. Legislators and the free press publicly demanded both, with some of the former boycotting in February the process that resulted in the selection of Chief Executive C.H. Tung to a second term. The government announced it would put in place in 2002 reforms for improved governance and executive accountability, a centerpiece of which would be a political appointment system for the top government policy secretaries. It was not clear, however, how these reforms would make the government more accountable to the Hong Kong people and legislature. Despite the public debate over the pace of democratizing elections for the legislature and chief executive, the Hong Kong government continued to state that the time was not appropriate to consider changes to Hong Kong’s election arrangements. The United States has substantial economic and political interests in Hong Kong and supports the concept of Hong Kong’s high degree of autonomy under Chinese sovereignty. In recognition of Hong Kong’s high degree of autonomy, the United States continues to accord Hong Kong a special status distinct from the rest of China. For example, the sanctions imposed on China after the June 1989 violence in Tiananmen Square (section 902 of P.L. 101-246) do not apply to Hong Kong. Similarly, the Hong Kong Policy Act allows the U.S. Government to license for export to Hong Kong sensitive commodities that we might not authorize for shipment to the PRC. In addition, the United States continues to lend support to Hong Kong’s autonomy by concluding and implementing bilateral agreements, promoting trade and investment, arranging high-level visits, broadening law enforcement cooperation, and bolstering educational, academic, and cultural links. II. BACKGROUND After 156 years of British colonial rule, Hong Kong became a Special Administrative Region (SAR) of the People’s Republic of China (PRC) on July 1, 1997. Hong Kong’s status is defined in two documents the Joint Declaration signed by Britain and China in 1984, and the Basic Law promulgated by China in 1990. These documents formally establish the concept of “one country, two systems” under which Hong Kong is guaranteed a high degree of autonomy except in foreign affairs and defense, and state that Hong Kong’s social and economic system and lifestyle, and the rights and freedoms enjoyed by the Hong Kong people will remain unchanged for at least 50 years. The United States supports Hong Kong’s autonomy and the United States-Hong Kong Policy Act of 1992, as amended, establishes the authority of the U.S. government to treat Hong Kong as a non-sovereign entity distinct from China for the purposes of U.S. domestic law based on the principles of the 1984 Sino-British Joint Declaration. III. U.S. INTERESTS IN HONG KONG U.S. interests in Hong Kong remain substantial. U.S. trade, investment, and business with Hong Kong, the world’s tenth largest trading entity and ninth largest banking center, flourish in a largely open environment. In 2001, U.S. exports to Hong Kong totaled U.S. $14.1 billion, making Hong Kong our thirteenth largest overseas export market. U.S. direct investment in Hong Kong through 2000 amounted to over U.S. $23.3. billion. Over 1,000 resident American firms operate in Hong Kong, and Hong Kong’s open society and attractive living environment make it home to an estimated 50,000 American citizens. (Included in this total are many dual nationals not counted by Hong Kong authorities as resident Americans.) Cooperation between the Hong Kong government and the U.S. Consulate General remains broad, effective and mutually beneficial. The United States enjoys strong cultural and educational relations with the people of Hong Kong, including a large flow of tourists and students in both directions. The United States has significant interests in promoting economic and business relationships, maintaining a cooperative law enforcement relationship (including in the global fight against terrorism), and continuing access to Hong Kong as a routine port of call for Navy ships. The United States also has strong interests in the protection of human rights, the promotion of democratic institutions, the free flow of information, the freedom of people to practice the religion of their choice, the development and protection of the rule of law, and the protection of individual liberties. Hong Kong residents share many values and interests with Americans and have worked to make Hong Kong a model of what can be achieved in a society that values freedom. Hong Kong is an open and largely tolerant society, in which both local and foreign non-governmental organizations continue to operate freely and representatives of the media work with few government-imposed restrictions. Protection of U.S. interests is enhanced by Hong Kong’s continued autonomy, stability, and prosperity after reversion to Chinese sovereignty; the operation of a full-service Consulate General; the protection of civil liberties; and the preservation of Hong Kong’s legal system, which permits sustained and effective cooperation on law enforcement issues. The United States works closely with the Hong Kong Special Administrative Region government and communicates our views on Hong Kong to the Hong Kong government, the central government authorities in Beijing, and the people of Hong Kong. IV. SIGNIFICANT DEVELOPMENTS AFFECTING U.S. INTERESTS IN HONG KONG (8/1/01 – 3/31/02) A. Anti-Terrorism Cooperation Hong Kong Chief Executive C.H. Tung and numerous other senior officials publicly pledged full cooperation with the U.S. and global effort against terrorism. The government formally implemented United Nations Security Council anti-terrorism resolutions 1267 and 1333, and is taking steps to implement resolutions 1373 and 1390. Since Hong Kong is not a state, implementation of UN agreements and resolutions occurs via its sovereign, the PRC. Beijing instructs Hong Kong to implement mandatory UN Security Council resolutions, whereas optional UN agreements are applied to Hong Kong after consultation between Beijing and the SAR government. Once these steps are taken, these instruments become part of Hong Kong’s body of law through appropriate executive or legislative action by the Hong Kong government. Most of the key UN anti-terror conventions apply to Hong Kong. The UN conventions against terrorist bombings and against terrorism financing do not yet apply to Hong Kong, as the SAR government is still putting in place implementing legislation necessary to give effect to the conventions’ requirements. Using lists of terrorist organizations and individuals supplied both by the U.S. government and United Nations, Hong Kong financial regulatory authorities have directed financial institutions to conduct record checks. To date, those institutions have found no such terrorist accounts. In the wake of the September 11 events, the Hong Kong police cooperated fully with U.S. law enforcement agencies, asked the U.S. government to provide updated watch lists on a regular basis, and pledged full cooperation in any terrorist investigations. Internationally, Hong Kong played a key role in leading the 29-member Financial Action Task Force (FATF) to adopt stringent anti-terrorism measures in the wake of September 11. As president of FATF during this crucial time period, Hong Kong was instrumental in the organization’s adoption of eight Special Recommendations that all members should implement in the fight against terrorism and terrorism financing. Hong Kong was also active in building global awareness of and support for FAFT’s work among non-members, including at a FATF plenary held in January in Hong Kong. B. Autonomy Hong Kong’s promised high degree of autonomy except in defense and foreign affairs remained a reality. Hong Kong, one of the world’s most open and dynamic economies, actively participated as a full member – and in some cases as a leader – of international economic organizations in which membership is not based on statehood. For example, Hong Kong is a separate and autonomous member of the World Trade Organization (WTO), the Asia Pacific Economic Cooperation forum, and the World Customs Organization. Hong Kong’s global leadership on trade liberalization was especially significant in 2001, with Hong Kong’s permanent representative to the WTO chairing the process that led to the launch of a new WTO negotiating round at Doha. Chinese central government authorities continue to take a “hands-off” approach to Hong Kong’s economic autonomy, and indeed Hong Kong and Beijing at times adopted different positions on various issues in multilateral economic fora. Customs border controls remained in place, and Hong Kong authorities continued to develop, implement, and enforce their own trade laws and regulations. At the same time, there was a growing tendency for Hong Kong, particularly in view of the continuing international economic slowdown and China’s continued economic opening, to view closer economic cooperation with mainland China as the primary answer to Hong Kong’s economic difficulties and a necessary component of its future economic prosperity. Hong Kong business and government leaders in 2001 repeatedly called on the PRC government to take action to “help” Hong Kong’s faltering economy. These calls for help have taken a number of forms, the most significant being the Chief Executive’s suggestion to PRC officials that Hong Kong and the Mainland initiate negotiations to conclude a free trade agreement, later renamed a “Closer Economic Partnership Agreement” (CEPA). Hong Kong and PRC officials pledged that the CEPA would be WTO-consistent and would be negotiated in a transparent manner. While there has been no erosion of Hong Kong’s export control regime, and customs border controls remained in place, there has been growing business pressure to streamline the border. We will continue to monitor closely these developments as Hong Kong moves toward closer economic interaction with mainland China. On the non-economic side, Hong Kong remained autonomous, and evident PRC pressures on issues related to Taiwan, the Vatican, and the Falun Gong that had caused concern in the previous reporting period did not publicly resurface. There were complaints by pro-democracy groups, however, that public expressions of support by PRC leaders and officials for a second term for Chief Executive C.H. Tung interfered with the process of selecting Hong Kong’s next chief executive. Hong Kong continued to submit its own reports to UN human rights bodies (under PRC diplomatic cover, because Hong Kong is not a sovereign state). On July 31 – August 1, 2001, to take the most recent example, the UN Committee on the Elimination of Racial Discrimination reviewed Hong Kong’s report under the International Covenant on the Elimination of Racial Discrimination. The People’s Liberation Army (PLA) Hong Kong Garrison, whose stated primary role is national defense, continued to be a largely unseen and symbolic presence in Hong Kong. As provided for in the Basic Law, the Garrison may assist the Hong Kong government in maintaining public order and disaster relief if requested by Hong Kong’s Chief Executive and approved by the Central Military Commission, but no such instances occurred. The Garrison did not engage in public security work, had limited interaction with the Hong Kong disciplined services, and did not engage in any business activities. The unprecedented and apparently successful visit of the PLA Navy destroyer “Shenzhen” to Hong Kong in November suggests that similar efforts to boost the reputation of the PLA and the Garrison among the general public are likely in the future. On invitation from the Hong Kong government, and with the permission of the Central Government, the PLA Garrison is expected to participate in Hong Kong’s annual Search and Rescue Exercise scheduled for April as it last did in December 2000. (The United States plans to participate as well.) Hong Kong law enforcement agencies remained independent of their PRC counterparts. In a step that showed clearly the extent of Hong Kong’s autonomy in immigration matters in the same way that convicted “spy” Li Shaomin’s admittance to Hong Kong did in July, the Hong Kong government in November allowed Nobel laureate Gao Xingjian, persona non grata in mainland China, to visit Hong Kong a second time in less than a year to receive an honorary degree. C. Political System The Basic Law calls for “gradual and orderly” progress toward the “ultimate aim” of electing the Chief Executive and all members of the legislature by universal suffrage. In February, incumbent Chief Executive C.H. Tung received 714 nominations for a second term from members of a Basic Law-defined selection committee of roughly 800 Hong Kong residents. In view of the requirement that a candidate receive at least 100 nominations, Tung’s 700-plus nominations precluded any opponent from running against him. Tung was therefore declared the winner at the end of the nomination period on February 28. In March, the PRC government formally appointed Tung to his second five-year term, which begins July 1. The number of directly elected seats in the 60-member Legislative Council elected in September 2000 remained 24. That number will rise to 30 in 2004 in accordance with the timetable laid out in the Basic Law. A group of pro-democracy activists formed a “Coalition Against a Second Term” and protested the undemocratic nature of the Chief Executive selection process. A number of legislators among the group, who were ex officio members of the Chief Executive selection committee by virtue of their status as legislators, boycotted the selection process. New groups composed of pro-democracy legislators, academics, human rights activists, and others formed to press for democratization in the coming years. Hong Kong government officials have committed to extensive public consultation on future constitutional developments, but continued to maintain that movement on this front should be gradual and that any decisions should take into account the experiences of the 2002 Chief Executive selection and the 2004 Legislative Council elections. There was also continued interest on the part of Hong Kong’s private sector to preserve the status quo under which functional (or occupational) constituencies make up half the legislature. Continued popular dissatisfaction with the unproductive confrontation between the legislative and executive branches, and with the government’s lack of accountability, led the Chief Executive to pledge “better governance” as one of his top campaign promises for his second term. One aspect of this was a government plan to realize the Chief Executive’s long-discussed “executive accountability scheme” early in his second term. According to the plan, the government would establish a new layer of senior, politically appointed officials to serve the Chief Executive, lead the politically neutral civil service, and argue in support of administration policies before the public and the legislature. While this scheme may enhance the ability of the Hong Kong government to build and press forward a clear agenda, it is not clear how this reform would increase accountability to the legislature and people as well as to the Chief Executive. D. Civil Liberties Freedoms of speech, press, religion, assembly, association, and other basic human rights remained well respected and staunchly defended in Hong Kong, although there were developments that caused concern. As was true in the previous reporting period, the severest test of Hong Kong’s human rights record was related to the ability of the members of the Falun Gong to protest and organize freely. While the group remained legally registered and experienced no restrictions on its ability to practice its beliefs, the group’s protests received close scrutiny by the authorities. In August, police briefly detained Falun Gong protesters who were conducting a rolling hunger strike outside PRC offices on the grounds of obstruction of a public place. In November, police confiscated some of the group’s banners on the same grounds. In March, police arrested a group of four Swiss and twelve local practitioners on public obstruction grounds, but this time decided to press charges. The 16 were released on bail pending trial. The group’s daily protests against PRC anti-Falun Gong policies nonetheless continued near the PRC offices throughout the reporting period. In addition, the Falun Gong has not been able to secure an appropriate venue to hold its annual international experience-sharing conference in Hong Kong. Whereas in the previous reporting period we noted that private sector entities like some hotels and bookstores were disinclined to rent venues to or otherwise associate with the group, in this reporting period, the group has found itself unable to rent space at numerous government-run cultural venues and at two publicly funded universities. Government spokesmen have responded to the group’s complaints with explanations that venues were fully booked, priority was being given to performing arts groups, and time slots had to be reserved for maintenance. The press remained free and generally aggressive in pursuit of a story, although there was continued concern over self-censorship, particularly by media whose owners had extensive business interests in the Mainland. Hundreds of societies have registered since reversion, and no applications for registration have been denied. Demonstrations averaged over five per day during the reporting period, above the pre-handover rate. Police generally used minimum constraints consistent with public order. Out of thousands of applications to hold public rallies or marches submitted since reversion, a small number were disallowed. In the most recent example, right of abode protesters were limited to 150 demonstrators in a planned March 1 rally (instead of the 2000 participants the group had expected) because the same group in an authorized February 26 march had staged an unscheduled sit-in that obstructed traffic on a main thoroughfare in downtown Hong Kong. Demonstration organizers cancelled the March 1 action. At the urging of some minority and human rights groups, the government continued to consider the introduction of anti-racial discrimination legislation. Smuggling of and trafficking in persons through and to Hong Kong remained an issue, but the government continued to combat such criminal activities. Article 23 of the Basic Law requires Hong Kong to enact laws to prohibit subversion, secession, treason, and sedition against the Chinese government, among other things. The process of formulating the required legislation continued, with the government committed to conducting wide consultations. Human rights groups worry about possible creation of speech crimes, particularly regarding subversion and secession, which have no common law basis. PRC officials made clear in late February during the visit to Beijing of Secretary for Justice Elsie Leung that the Hong Kong government remains obliged to move forward with such legislation. E. Judicial and Legal Developments Rule of law has continued to prevail in Hong Kong under the common law system dating from colonial days and as prescribed by the Basic Law. From district courts up to the Court of Final Appeal – Hong Kong’s ultimate adjudication body – justice is meted out fairly, and is largely seen to be fair. A non-partisan commission makes judicial appointments (although some have called publicly for the nomination process to be more transparent). The quality of judges is high, and the Court of Final appeal includes distinguished justices from other Commonwealth jurisdictions who take part on a case-by-case basis. The well-known 1999 “right of abode” case, in which the Hong Kong government sought a reinterpretation by the PRC National People’s Congress Standing Committee (NPCSC), continues to loom in the background whenever sensitive issues come before the Court of Final Appeal. Although the Basic Law provides for interpretation by the NPCSC under certain circumstances, the use of a mainland mechanism foreign to common law practice to overturn in effect a decision of Hong Kong’s courts unsettled many who thought that the practice undermined Hong Kong’s judicial authority. Although there have been no subsequent referrals to the NPCSC for a reinterpretation, the Hong Kong government in more recent right of abode cases argued that the court itself should seek NPCSC interpretations. Court rulings in July, however, revealed that the court declined to seek such interpretations and the Hong Kong government did not seek an NPCSCC reinterpretation in the one case that it lost. In a sign that the effects of the 1999 controversy were still with us, some observers interpreted a court decision in January on another right of abode case, which granted relief to only a small percentage of the 5,000-plus claimants, as a sign that the court was unwilling to risk confrontation with the government that might lead to another NPCSC reinterpretation. Others, including some human rights, activists, did not make that interpretation. Concerns also remained over concurrent jurisdiction, arising when Hong Kong residents were arrested and tried in China for crimes at least partly committed in Hong Kong. A limited Hong Kong-PRC arrest notification mechanism that entered into force in January 2001 came under increasing criticism for its limitations, and discussions continued on rendition and prisoner transfer agreements. Concerns about Hong Kongers¡¦ rights under the agreement kept the issues under close scrutiny. F. Bilateral Agreements There are more than a dozen U.S.-Hong Kong bilateral agreements currently in force, including a stand-alone air services agreement, and extradition, prisoner transfer, and mutual legal assistance agreements that entered into force since reversion. (Little progress has been made since 1997 on a U.S.-Hong Kong Bilateral Investment Agreement.) On the whole, these agreements have functioned very well, although Hong Kong legal requirements for “sovereign assent” by the PRC government with respect to some international cooperation have in a small number of cases in the past hindered timely cooperation. G. Suspensions under Section 201 (A), Terminations under Section 202 (D), or Determinations under Section 201 (B) There were no suspensions under section 201 (A), terminations under section 202 (D), or determinations under section 201 (B) of the United States-Hong Kong Policy Art of 1992, as amended, during the period covered by this report (August 1, 2001 to March 31, 2002). V. U.S.-HONG KONG RELATIONS (8/1/01 – 3/31/02) A. Economic-Commercial Over the past several years Hong Kong has made dramatic progress in fighting optical disc piracy, starting with the creation of an anti-piracy task force in the Customs Department that allowed a stepped-up pace of raids against retail establishments and pirate manufacturers beginning in 1999. The past year also brought enactment of an amendment that criminalized the corporate use of unlicensed copyright materials from April 1, 2001. A public outcry led the government to partially suspend the criminal provisions of this law, but authorities pressed ahead with enforcement for certain key categories of works: computer software, movies, television shows, and sound recordings. At the end of the reporting period, the government was pursuing several corporate piracy cases, including one that produced a first ever conviction under the 2001 amendment. Reflecting this combination of stepped-up enforcement and strengthened legislation, the Office of the U.S. Trade Representative now regularly cites Hong Kong as a model for other Asian economies struggling with their own problems of IPR piracy. Hong Kong maintained few non-tariff barriers and investment restrictions and moved steadily to reduce or remove what few restrictions exist. For example, beginning in 1998, Hong Kong has opened the broadcast and telecommunications markets to greater competition. One result of this liberalization was a significant increase in U.S. direct foreign investment (U.S. $2.5 billion in 1999), including several major telecommunications projects. In January, the government announced plans to open the local wire-based telecommunications market beginning in 2003, thereby removing the last major element of protection from this sector. Hong Kong’s strong pro-competition record in telecommunications and broadcast, however, is not matched across the board. The absence of a comprehensive an titrust law and the high cost of local market entry has led to domination of some service sectors by major local companies. The United States continued efforts to negotiate significant liberalization of the U.S.-Hong Kong civil aviation agreement, holding two rounds of negotiations during the period covered by this report. Liberalization would benefit consumers, businesses, and airlines and also the overall Hong Kong economy. A wide gap remains, however, between the U.S. position and the more restrictive Hong Kong approach. U.S. companies continued to have a favorable view of Hong Kong’s business environment, including its autonomous, impartial legal system, and the free flow of information, low taxation, and well-developed infrastructure. The American Chamber of Commerce’s annual business confidence survey of its members, conducted in late-2001, showed that despite difficult economic conditions, they retained confidence in Hong Kong’s future: 43 percent believed the business outlook for 2002 was “good” or “satisfactory”, but this number increased to 83 percent and 92 percent for 2003 and 2004, respectively. U.S. and other foreign companies also continue to find Hong Kong attractive as a headquarters location for China and the wider Asia region. Chief Executive Tung and other senior officials have reaffirmed the government’s commitment to the existing currency regime linking the Hong Kong dollar to the U.S. dollar. The Hong Kong government issued a consultation paper on labeling biotech foods, which proposed three policy options, including voluntary and mandatory measures. The U.S. government is watching these consultations closely, as the adoption of any mandatory measures could affect U.S. exports to Hong Kong of biotech foods. B. Export Controls There were no significant problems between Hong Kong and the United States in export control cooperation. Hong Kong continued to maintain an effective, autonomous and transparent export control system. Hong Kong authorities cooperated closely with U.S. and international counterparts to ensure compliance with relevant export control regimes. The 7th round of U.S.-Hong Kong interagency export control discussions took place in March and focused on the effect on Hong Kong’s export control system of a closer economic partnership with the Mainland. Hong Kong reasserted its commitment to enforce an autonomous control system while streamlining border controls and deepening economic ties with the Mainland. Hong Kong’s past emphasis on its autonomy and separateness was tempered by a new focus on promoting economic integration with the Mainland and facilitating cross-border traffic. The U.S. delegation emphasized the importance the United States places on Hong Kong’s autonomy and cautioned that border streamlining and economic integration must not impair the integrity of Hong Kong’s autonomous customs territory. Enforcement and licensing issues arising from increased cross-boundary trade also were discussed, as were measures that both the United States and Hong Kong will take to resolve these issues. U.S. Department of Commerce representatives in Hong Kong continue, on a regular basis, to carry out pre-license checks and post-shipment verifications on companies in Hong Kong as part of the dual-use licensing, vetting, and post-issuance process. Similarly, Department of State and U.S. Customs officials carry out end-use checks on munitions items. In both cases, Hong Kong officials are neither informed of such checks nor involved in making them. The importance of these checks was underscored by a 1997 General Accounting Office (GAO) report that stated the results of such checks were a key factor in determining if Hong Kong continues to maintain an effective export control system. These efforts are supplemented by regular visits to Hong Kong by Commerce Department enforcement agents under the Safeguards Verification program to conduct pre-shipment and post-shipment verification checks. The most recent team, which visited Hong Kong in January 2002, conducted 38 checks. The results of these checks, and plans to send another special team to Hong Kong later in 2002, were discussed during the March export control discussions. Hong Kong Customs and Excise and the Trade and Industry Department continue to devote extensive resources to Hong Kong’s strategic trade licensing and enforcement system. The very large volume of import and export license requests that the Trade and Industry Department processed in 2001 reflects Hong Kong’s extensive requirements for import and export licenses for the most sensitive goods, even if only in transit. Hong Kong’s system also criminalizes the brokering of sensitive commodities related to weapons of mass destruction programs. In its licensing policy, Hong Kong continues to apply all the major multilateral control lists and the licensing requirements of its trading partners. During 2001, Hong Kong assisted U.S. law enforcement authorities in their investigation of allegations that in 1998 a Mainland China entity allegedly used Hong Kong and Florida front companies to export radiation-hardened integrated circuits through Hong Kong to a Mainland Chinese end user. Hong Kong and U.S. law enforcement cooperated in staging simultaneous raids on the targeted company and coordinated closely their follow-up investigations. C. Law Enforcement Cooperation, Extradition, and Mutual Legal Assistance Law enforcement cooperation remained a central pillar of U.S.-Hong Kong relations. The Consulate is home to seven law enforcement agencies or bureaus: DEA, FBI, INS, Customs, Secret Service, IRS Criminal Investigation Division, and the State Department’s Bureau of Diplomatic Security. U.S. and Hong Kong law enforcement agencies cooperated to combat activities such as terrorism, human smuggling, trafficking in persons, narcotics trafficking, commercial fraud, counterfeiting, credit card fraud, money laundering, violations of intellectual property rights, and general organized crime. U.S.-Hong Kong agreements on extradition, prisoner transfer, and mutual legal assistance, in effect since 1998, 1999, and 2000, respectively, all continued to function smoothly in most instances. D. U.S. Military Ship and Plane Visits Since the July resumption of PRC approvals of requests for U.S. military ship and plane visits to Hong Kong following the April 2001 EP-3 aircraft incident cut-off, nearly 20 ships, including two aircraft carrier battle groups and the Seventh Fleet Flagship with the Commander of the Seventh Fleet embarked, have visited Hong Kong. At the very end of the reporting period, however, the PRC denied a U.S. Navy ship visit request. The U.S. Navy also resumed its program of providing Deck Landing Qualification support to Government Flying Service helicopters during these visits. In the wake of the September 11 terrorist attacks on the United States, force protection support provided by local authorities was excellent during each of these visits. While Beijing did not approve the visit of any U.S. Navy P-3 aircraft to Hong Kong since the EP-3 incident, a number of other non-P-3 aircraft missions were approved. E. Passport and Visa Regime The HKSAR passport is issued to Chinese nationals holding Hong Kong permanent identity cards. The British National Overseas (BNO) passport is issued by the British government. China, however, recognizes the BNO passport as a travel document only, and not as evidence of citizenship. Most Hong Kong residents are entitled to hold BNO passports and HKSAR passports concurrently. The Hong Kong government continued to seek visa-free access for the HKSAR passport to other countries, with 107 countries currently affording visa-free entry. U.S. citizens visiting Hong Kong for a temporary stay of less than 90 days may enter without a visa. The ability of the United States to reciprocate – to offer visa-free entry to holders of the HKSAR passport – is governed and limited by the terms of the Visa Waiver Program in section 217 of the Immigration and Nationality Act, 8 U.S.C. 1187. The United States currently issues ten-year multiple-entry visitor visas to qualified applicants, the maximum validity period available under U.S. law. F. Cultural, Educational, Scientific, and Academic Exchanges Exchanges between Hong Kong’s seven universities and other educational institutions and their U.S. counterparts range from short-term visits by American faculty and summer programs for students to ambitious multi-year exchanges of faculty and staff. In general, such linkages are beneficial exercises involving a practical exchange of ideas and sharing of resources and experiences. The Fulbright program in Hong Kong, which operates independently from the one in mainland China, supports four U.S. lecturers, one U.S. researcher, and three to four U.S. students in Hong Kong each year. The HKSAR government, through the Research Grants Council, now funds post-graduate research in the United States for four Hong Kong academics for up to one academic year. The initial group of candidates was selected in early 2002 by a panel of distinguished U.S. and Hong Kong academics and professionals, and will begin U.S. programs during the 2002-2003 academic year. The Hong Kong-America Center (HKAC), whose Board of Governors is made up of prominent American and Hong Kong leaders from the business and academic communities, has been in operation since 1993 with support from local universities and the Department of State. As part of its mission to foster exchanges between Hong Kong and the United States, the HKAC handles the administrative procedures for selection of Hong Kong Fulbrighters who will do research in the United States. Its supporting institutions are the Chinese University of Hong Kong, Baptist University, the University of Hong Kong, City University, and the Polytechnic University. The Department of State supports the University of Hong Kong American Studies degree program by providing a Fulbright Scholar to the program each year. The Institute of International Education (IIE) Hong Kong provides educational advisory service; and conducts outreach programs for schools and thousands of Hong Kong and Macau students who wish to pursue studies in the United States. It also organizes well-attended university fairs and briefs American educators on opportunities in Hong Kong. The Department of State International Visitor Program supports a wide variety of professional exchanges for candidates sponsored by the Consulate General. In 2001-2002, over 14 individuals from Hong Kong and Macau, including journalists, politicians, government and law enforcement officials, and an environmentalist have traveled or will travel to the United States on study tours.   For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861-2622 or by fax at 2861-3361.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Six-monthly Report onHong Kong July-December 2001 Presented to Parliament By the Secretary of State for Foreign and Commonwealth Alairs By Command of HerMajesty March 2002

2002.03.01
FOREWORDThis is the tenth in a series of six-monthly reports on the implementation of the Sino-British Joint Declaration on the Question of Hong Kong. It covers the period from 1 July to 31 December 2001. Hong Kong faced a testing time during these months. As an international centre for trade and finance, it was a!ected by the world economic slowdown. And the repercussions of the terrible events of 11 September in the United States were felt in Hong Kong as in so many places. I welcome the Special Administrative Region Government’s firm commitment to join the global fight against terrorism, and the positive part it has played in international e!orts to tackle terrorist financing through its Presidency of the OECD’s Financial Action Task Force. Hong Kong’s skilful Chairmanship of another body, the General Council of the World Trade Organisation, was key in bringing about the successful launch of a new world trade round in Doha in November. It is encouraging to see the SAR playing a constructive role on the international stage, within the framework of the Joint Declaration and the Basic Law. Overall, our view remains that the concept of “One Country, Two Systems” is an everyday reality in Hong Kong. The rule of law and the independence of the judiciary, which are so vital to Hong Kong’s success, are being upheld. Essential rights and freedoms are being protected, and challenges to them fully and freely debated. We remain strongly committed to Hong Kong, reflecting both our historic responsibilities and a forward-looking relationship with an important partner in the region. We will continue to watch developments there closely. JACK STRAWSecretary of Statefor Foreign and Commonwealth Affairs SIX-MONTHLY REPORT ON THE IMPLEMENTATION OF THEJOINT DECLARATION ON HONG KONG INTRODUCTION1. This series of reports is a re£ection of the British Government’s continuing interest in Hong Kong, and of our commitment to the faithful implementation of the Sino-British Joint Declaration on Hong Kong. The Joint Declaration, signed in 1984, promised a high degree of autonomy for the Hong Kong Special Administrative Region (SAR) except in foreign and defence a!airs, and guaranteed the continuation of Hong Kong’s social and economic systems, lifestyle and rights and freedoms. These reports provide an assessment of developments in Hong Kong, focusing in particular on the extent to which the Joint Declaration’s promises and guarantees are being realised in practice. TERRORISM2. Following the September 11 attacks in the United States, the SAR Government has pledged its full support in the global fight against terrorism and terrorist financing. We welcome this. Prior to September 11, Hong Kong had already enacted legislation implementing United Nations Security Council Resolution (UNSCR) 1267, dealing with financing for the Taliban. On October 12, further legislation was passed implementing UNSCR 1333, which required States to freeze the assets of Usama bin Laden and his associates. The SAR Government is now giving urgent consideration to comprehensive new legislation to enable it to implement UNSCR 1373, which requires States to combat terrorism on a range of fronts. 3. Hong Kong currently holds the Presidency of the OECD anti-money laundering body, the Financial Action Task Force (FATF), and in October convened an extraordinary plenary meeting in Washington at which the FATF agreed to extend its mission to cover terrorist financing. The meeting agreed eight special recommendations on terrorist financing. Members are expected to comply with these by June 2002. HONG KONG SAR GOVERNMENT4. The Chief Executive of the SAR Government, Mr C H Tung, whose term of office expires on 30 June 2002, announced in December that he would run for a second five-year term. The election, by an Election Committee of 800 members from various sectors, is due to take place on 24 March 2002. Nominations for candidature are open from 15 to 28 February. Candidates are to be nominated by at least 100 members of the Election Committee. As of 31 December, no other candidate had come forward. 5. Mr Tung visited Beijing on 19 December to present his annual report to the Chinese leadership. He met President Jiang Zemin who, according to official media accounts, stated that the central authorities were satisfied with Mr Tung’s performance and would continue to give full support to his work. Mr Jiang also praised Mr Tung’s decision to stand for re- election and said that the Central Government wished him to continue to lead the SAR Government. Some in Hong Kong expressed concerns that open endorsement of Mr Tung’s candidacy by the Central People’s Government would influence the Election Committee or deter others from standing. Vice-Premier Qian Qichen was reported to have denied that the election was controlled, saying that members of the Election Committee were elected and represented the views of the public. 6. Controversy arose in July when Mr Yeung Kwong, who was actively involved in the anti-Government riots in Hong Kong in 1967, received the Grand Bauhinia Medal (the SAR’s highest honour). The SAR Government said that the award was in recognition of Mr Yeung’s contribution to the trade union movement. BASIC RIGHTS AND FREEDOMS 7. Our last six-monthly report (Cm 5197) referred to controversy over the treatment of Falun Gong, a group banned as a cult on the mainland but legally registered and allowed to carry on its activities in Hong Kong within the law. The report noted that the SAR Government, while indicating that it would closely watch Falun Gong’s activities, had said that it did not, at present, intend to introduce anti-cult legislation. That position remains unchanged. Falun Gong followers have continued to be allowed to stage protests, although in November o?cials removed banners from protesters near the Liaison Office of the Central People’s Government on the grounds that they had caused obstruction. 8. More widely, the freedom to demonstrate has continued to be respected, with many groups staging peaceful protests. In September, a magistrate acquitted three men who had been charged in connection with demonstrations in May during the Fortune Global Forum, which was attended by President Jiang Zemin. The men had scuffled with police officers who had tried to remove their vehicle. The magistrate said that the Police had had no legal power to tow away the vehicle and that the defendants were entitled to refuse to co-operate. 9. Dr Li Shao-min, a Hong Kong-based academic who was convicted by a mainland court of spying and deported to the United States, was allowed to return to Hong Kong in July. Dr Li resumed his work at the City University of Hong Kong and in October was elected to the University’s Senate. The SAR Government’s decision to allow Dr Li to return was widely seen as an indicator of “One Country, Two Systems” working in practice. 10. The Hong Kong Journalists Association and the Article 19 Group (the Global Campaign for Freedom of Expression) published their ninth annual report on freedom of expression in Hong Kong in July. The report concluded that people in Hong Kong in large measure enjoyed freedom of expression and that the media continued to report on controversial issues. But it highlighted a number of concerns, particularly in relation to the SAR Government’s handling of Falun Gong; and called on the media to take action to deal with what it called a “credibility problem, arising from “ethical” excesses, self-censorship and internal measures to sideline journalists who are especially critical”. 11. In July/August, the UN Committee on the Elimination of Racial Discrimination examined reports from China, including Hong Kong. We welcome the fact that Hong Kong’s report was prepared by the SAR Government and defended in Geneva by SAR Government o?cials attending as part of a delegation from the People’s Republic of China. The UN Committee’s main concern in relation to Hong Kong was the lack of legislation against racial discrimination; it recommended that the situation should be thoroughly reviewed and appropriate legislation adopted. The SAR Government has reiterated that it is reviewing its position on legislation, with a view to determining the way forward in early 2002. 12. In December, the right to education of mainland children in Hong Kong became the subject of heated debate when it was reported that 187 children had been denied schooling. The children were “on recognisance” pending the outcome of right of abode litigation or removal proceedings. The SAR Government said that allowing the children to attend school would encourage others to enter Hong Kong illegally. The Government’s position was criticised by legislators and human rights groups, who argued that the children had the right to education under the UN Convention on the Rights of the Child, regardless of their status. The SAR Government subsequently undertook to review, on a case-by-case basis, applications for school admission by the children involved. CONSTITUTIONAL DEVELOPMENT13. Our last six-monthly report referred to the Chief Executive Election Bill, introduced by the SAR Government in March 2001 to provide for the detailed arrangements for the Chief Executive election in March 2002. The Legislative Council passed the Bill in July after intense discussion. There was controversy over a provision specifying that the Central People’s Government could remove the Chief Executive: some legislators criticised this as giving unnecessarily wide powers to Beijing and undermining Hong Kong’s autonomy. Mr Michael Suen, Secretary for Constitutional A!airs, said that the new law “confers no additional power on the Central People’s Government to remove the Chief Executive from office”, and that “such a removal power can come only from the Basic Law”. 14. Our six-monthly report for January – June 2000 (Cm 4809) noted that the accountability of senior officials had become a major issue of discussion in the wake of a public housing construction scandal, with some observers and politicians calling for the introduction of a Ministerial system of government. Our report for July – December 2000 (Cm 5067) noted that the Chief Executive, in his October 2000 Policy Address, had announced a review of certain issues of governance, including the accountability of senior officials. In his October 2001 Policy Address, Mr Tung proposed a new system of appointing principal officials, applicable to the top three secretaries (the Chief Secretary for Administration, Financial Secretary and Secretary for Justice) and most policy secretaries. Currently, nearly all such officials are civil servants, on permanent terms. Under the new system, they would be drawn from inside or outside the civil service and employed on contract terms, with their term of office not exceeding that of the Chief Executive who nominated them. They would be answerable to the Chief Executive, who would have the authority to recommend their removal. Consideration would be given to appointing them to the Executive Council. 15. The Chief Secretary for Administration, Mr Donald Tsang, said that the new principal officials would form a “political decision-making layer”, responsible for policy formulation, while the civil service would remain politically neutral, with responsibility for public administration. He said that the appointment of principal officials to the Executive Council would enable them to take part collectively in “a more conventional Cabinet-style system”. 16. Mr Tung has said that implementation of the proposals would be for the Chief Executive in the second term to decide; but that if he were re-elected, he would implement them from 1 July 2002. 17. Reactions to the proposals have been mixed. Some legislators and commentators have welcomed them; others have queried whether politically appointed “Ministers” would be accountable to the public, or only to the Chief Executive, who is not popularly elected. The Bar Association and Ms Margaret Ng, representing the legal constituency in the Legislative Council, expressed concern that the ability of the Secretary for Justice to act independently, particularly as regards prosecution decisions, might be compromised if the post became a political appointment. The SAR Government has said that the new “Ministers” would have to be individually responsible for any serious mistake, with resignation being an option; and that the proposed arrangements would not a!ect the Secretary for Justice’s constitutional duty to act independently in respect of prosecutions. 18. The Basic Law provides for “gradual and orderly” progress after 2007 towards the ultimate aim of election of the Chief Executive and of all the members of the Legislative Council by universal suffrage. In his October 2001 Policy Address, the Chief Executive suggested that the SAR Government would wish to review the experience of elections in 2002 (for Chief Executive) and 2004 (for the Legislative Council) before consulting the public on the post-2007 constitutional structure. It remains our hope that Hong Kong will move as quickly as possible towards a fully directly elected legislature, and a democratically elected Chief Executive, at a pace in line with the wishes of the community. LEGAL SYSTEM19. Previous reports have described the controversy surrounding the right of abode issue, and in particular the SAR Government’s decision in 1999 to seek an interpretation from Beijing (the National People’s Congress) of right of abode provisions in the Basic Law, following a ruling by the Court of Final Appeal (CFA) in Hong Kong. In July 2001, the CFA ruled on three further right of abode cases. The Court opted to rule on the cases together because they raised a number of common questions, including whether the Court had to refer to the Standing Committee of the National People’s Congress (NPCSC) for an interpretation of the relevant Basic Law provisions. 20. The first case, referred to in our last six-monthly report, involved a child born in Hong Kong to visiting mainland parents. The Court of First Instance and Court of Appeal both found that the child had the right of abode. The SAR Government urged the CFA to seek an interpretation from the NPCSC before ruling on the case. The CFA unanimously upheld the ruling of the lower courts. It did not seek an interpretation from the NPCSC. The CFA’s judgement stated that where the NPCSC had made an interpretation of the Basic Law, the courts in Hong Kong were bound to follow it; but that the SAR Government had accepted that the NPCSC’s 1999 Interpretation was not binding in relation to the current case. The CFA took the view that the provision in question of the Basic Law was within Hong Kong’s autonomy; and that, on a common law approach, its meaning was clear and the child had the right of abode. 21. The second case concerned children born in the mainland and adopted there by parents at least one of whom had the right of abode in Hong Kong. The appellants argued that adopted children should have right of abode in the same way as natural children. They won at First Instance but lost at Appeal. The CFA by majority dismissed their appeals. The Court was unanimous that nothing in the 1999 NPCSC Interpretation carried any implication as to the status of adopted children, and that the Basic Law provision in question was within the SAR’s autonomy. The majority took the view that the provision could refer only to natural children. One judge dissented, arguing for a reading promoting family unity. 22. The third case concerned whether time spent in prison should count towards the residence period required for non-Chinese nationals to acquire right of abode. The appellant lost at both First Instance and Appeal, and the CFA dismissed the appeal. 23. A spokesman for the Legislative A!airs Commission of the NPCSC expressed concern about the ruling in the first case, saying that it did not fully correspond with the NPCSC’s 1999 Interpretation. The SAR Government however made clear, as it had done before the ruling, that it would accept the Court’s decision. We welcome this. Many legal experts and commentators took the view that these rulings bolstered the independence of Hong Kong’s legal system. 24. As of 31 December, the CFA had still to rule in a right of abode case involving several thousand mainlanders who claim that they are not a!ected by the 1999 NPCSC Interpretation. 25. The SAR Government is carrying out a comprehensive review of legal education and training in Hong Kong; a report by consultants was published in August. In December, a Working Party established by the Chief Justice published proposals for reform of the civil justice system. The proposals, designed to improve access to civil justice, draw on developments in other common law jurisdictions, in particular the Woolf reforms in England and Wales. Comments have been invited from the legal profession and the public. INTERNATIONAL INTEREST IN HONG KONG26. International interest in developments in Hong Kong continued; assessments remained broadly positive. In July, the European Commission published its third annual report on Hong Kong, covering the year 2000. In August, the US State Department published a report on Hong Kong covering the period from 1 April 2000 to 31 July 2001. The report concluded that Hong Kong “remained a free society that extended basic civil liberties to its citizens every day, defined its identity in terms of being an open international city, and largely continued to make its own decisions in pursuit of its own identity and economic interests”. The report however noted that “there were some issues warranting attention”, in particular the handling of Falun Gong. The Chairman of the UN’s Economic, Social and Cultural Rights Committee visited Hong Kong in July. HONG KONG’S WIDER ROLE27. Hong Kong continues to play an active role on the international stage, within the framework laid down in the Joint Declaration and Basic Law. It takes part in some 50 inter- governmental organisations, whether in its own right or as part of the People’s Republic of China. As indicated above, Hong Kong played a constructive role in the international fight against terrorism in its capacity as President of the Financial Action Task Force. Hong Kong also currently holds the Chairmanship of the General Council of the World Trade Organisation (WTO), and was a key player in bringing about a successful conclusion to negotiations in Doha in November to launch a new world trade round. 28. The Chief Executive visited the US in July and attended the APEC Economic Leaders’ meeting in Shanghai in October; the Chief Secretary for Administration also visited the US as well as the UK (see below). High level overseas visitors to Hong Kong included the Presidents of the Philippines and of South Africa, who visited in October and December respectively. 29. Hong Kong remains a popular location for international conferences and meetings. The SAR Government announced in October that it would invest up to $2 billion in a new conference and exhibition centre at Chek Lap Kok Airport. Major conferences held during the period of this report included the World Services Congress in September and the World Economic Forum’s annual Asia-Pacific Economic Summit in October. ECONOMY30. Hong Kong’s highly externalised economy was adversely a!ected in the second half of 2001 by the global slowdown and the after-e!ects of September’s terrorist attacks in the US. The SAR Government is now projecting zero growth for the year as a whole. Unemployment has risen and de£ation persisted. But the economy is expected to bounce back quickly once recovery in the US gets under way. 31. The Government has warned that there may be a record budget deficit in the 2001/02 financial year. Hong Kong has large fiscal reserves, but there are concerns that recent operating deficits may be structural. The SAR Government is therefore reviewing public finances and the scope for new, broader-based taxes. Reports on both aspects are expected shortly. 32. In his October Policy Address, the Chief Executive announced a number of short-term measures to o!set the cyclical downturn. He also focused heavily on education and training, which are seen as key to transforming Hong Kong into a knowledge-based economy. 33. There has been continued debate on how Hong Kong can best position itself to take advantage of the further opening up of the mainland economy following China’s accession to the WTO in December. The Chief Executive’s Policy Address, like the Budget earlier in the year, placed strong emphasis on economic integration with the mainland. Mr Tung announced an easing of restrictions on visits to Hong Kong by mainland tourists and businesspeople; the introduction of three-year multiple visas for expatriate Hong Kong permanent residents travelling to the mainland; and the establishment of a Hong Kong Economic and Trade Office in Guangzhou. He also highlighted current and future projects to develop infrastructure links between Hong Kong and neighbouring Guangdong Province. The SAR and Central People’s Governments have since indicated that they are considering a free-trade arrangement between Hong Kong and the mainland. 34. Following comments by the Financial Secretary, Mr Anthony Leung, there was speculation in October about possible changes to Hong Kong’s linked exchange rate regime. However, Mr Leung and the Chief Executive strongly denied that there was any intention to move from the current regime. The Chief Executive of the Hong Kong Monetary Authority, Mr Joseph Yam, gave a speech on 24 October defending the peg. He said that the outcome of de-pegging even with the most benign conditions and the best judged strategy would be “uncertainty and instability”; to de-peg when the economy was weak would be “a catastrophe”. BILATERAL RELATIONS35. Relations between the United Kingdom and Hong Kong are deep and wide-ranging, with extensive contacts in the fields of culture, education, the professions, business, legal a!airs and government. The period of this report saw a stream of high-level visits in both directions. Mr Donald Tsang visited London in November, for the first time in his capacity as Chief Secretary for Administration. He met the Deputy Prime Minister, the Lord Chancellor and the Secretary of State for Trade and Industry. Other senior SAR Government visitors to the United Kingdom included Mrs Regina Ip, Secretary for Security, and Mr Joseph Wong, Secretary for the Civil Service. Dr Denis MacShane, Parliamentary Under-Secretary of State at the Foreign and Commonwealth Office with responsibility for Hong Kong a!airs, visited Hong Kong twice, in September and November. The Lord Mayor of London, Sir David Howard, visited in October and addressed a seminar on private/public partnership organised by the British Consulate General. The Lord Chief Justice, Lord Woolf of Barnes, visited in July and spoke on access to justice at a seminar organised by the British Council. 36. During his second visit to Hong Kong in November, Dr MacShane joined the Chief Executive in opening the INTEGER Hong Kong Pavilion, a joint United Kingdom/Hong Kong project designed to demonstrate how intelligent and green building techniques can be adapted to meet conditions in Hong Kong. The Pavilion, located in a prominent position on the north shore of Hong Kong Island and open to the public throughout 2002, is the result of close collaboration between the British and SAR Governments. It also involves public organisations and private companies in a model public/private project. The project is a very visible symbol of practical co-operation between Britain and Hong Kong on interests which matter to both ^ innovation, sustainability, the environment and education. 37. Another key area of cooperation between Britain and Hong Kong is in English language teaching. The SAR Government is keen to promote the wider use of English as part of its aim to position Hong Kong as Asia’s World City. In his October Policy Address, the Chief Executive announced plans to provide native-speaking English teachers or assistants in all primary schools. A scheme to provide such teachers in secondary schools was implemented in the 1998-99 school year. 38. The British Council plays a vital role in supporting these e!orts to improve the learning and teaching of English. The Council’s work supports local education reform objectives while simultaneously building a generation of learners able to take advantage of education opportunities in the United Kingdom. The Council teaches English to around 45,000 learners each year. It runs teacher support programmes for the Education Department and organises visits, conferences and workshops. 39. December 2001 saw the launch in Hong Kong of the English Speaking Union (ESU), an international educational charity dedicated to creating global understanding through the English language. The Chief Executive, Mr Tung, joined Lord Watson of Richmond, Chairman of the Commonwealth ESU, and Mr William Miller, Chairman of the US ESU, for the opening ceremony. The launch culminated in a live internet debate between outstanding students in the United Kingdom and Hong Kong. The debate was opened in London by Mrs Margaret Hodge, Minister of State for Lifelong Learning and Higher Education, and in Hong Kong by Mrs Anson Chan, Patron of the ESU of Hong Kong. 40. The United Kingdom and Hong Kong remain major trading partners: Hong Kong is still our second largest export market in Asia. During the period of this report, Trade Partners UK supported seven trade missions to Hong Kong and visits by five business groups to trade fairs in the SAR. BRITISH NATIONALS (OVERSEAS)41. The British Government remains committed to providing the highest standard of consular and passport services to the 3.44 million holders of British National (Overseas) (BN(O)) passports. There was a drop in reported cases of BN(O) passport holders in difficulties in third countries during the period of this report. We continued to offer practical assistance where necessary, for example, by helping in the repatriation of a small number of BN(O) passport holders back to Hong Kong. The Passport Section of the British Consulate- General is the largest passport issuing operation outside the United Kingdom. In 2001, a record 168,025 BN(O) passports were issued. VISA-FREE ACCESS FOR HONG KONG SAR AND BRITISH NATIONAL (OVERSEAS) PASSPORT HOLDERS42. In our last report, we noted that arrangements for the new EU Common Visa List and Regulation had been implemented in April 2001, giving Hong Kong SAR passport holders visa-free access for short visits to all EU countries. Following the decision to include the SAR passport on the EU visa-exempt list, the European Community and the SAR have negotiated a bilateral agreement on the re-admission of persons. The agreement was initialled in Brussels in November in the presence of Mr Donald Tsang, SAR Chief Secretary, and Mr Antonio Vitorino, European Commissioner for Justice and Home A!airs. Mr Vitorino said that Hong Kong’s willingness to conclude the agreement, the first of its type for the European Community, was a positive sign of Hong Kong’s free and open society. 43. Since the EU Common Visa List took e!ect, the SAR passport has secured visa-free access to a number of other countries; as at 31 December, the total number of countries offering such access was 104. 44. As at 31 December, 90 countries o!ered visa-free access to BN(O) passport holders. We are concerned to secure the maximum travel convenience for BN(O) passport holders world-wide and, as a priority, to ensure that BN(O)s can enjoy the same access within Europe as SAR passport holders. We are working with EU member states who do not currently o!er visa-free access to the BN(O) passport to achieve this. We will continue to look for opportunities to promote visa-free travel for both SAR and BN(O) passport holders. CONCLUSION45. At the end of 2001, our overall assessment remains that “One Country, Two Systems” is working well in practice. There have been challenges and difficulties. But as events over the past six months have shown, the SAR Government has by and large exercised the high degree of autonomy promised under the Joint Declaration and the Basic Law, including on issues of considerable sensitivity. The judiciary has operated independently. Essential freedoms remain intact. Issues of concern have been openly and sometimes hotly debated in the Legislative Council and in the media. Hong Kong has continued to look out to the world, to attract investment and to play a constructive role in the international community. 46. The continued success of “One Country, Two Systems” will depend on how deeply the values of the Joint Declaration remain entrenched in the culture of the SAR Government and Hong Kong society. We will continue to watch closely, and to support Hong Kong in running its own a!airs and upholding its people’s rights and freedoms, within the framework of the Joint Declaration. For enquiries, please contact Mr. Kim Wan of The Better Hong Kong Foundation at 2861 2622 or by fax at 2861 3361. Six-monthly Report on Hong Kong July-December 2001 Presented to ParliamentBy the Secretary of State for Foreign and Commonwealth A¡airsBy Command of HerMajestyMarch 2002 ß Crown Copyright 2002The text in this document may be reproduced free of charge in any format or mediawithout requiring speci¢c permission. This is subject to the material not being used ina derogatory manner or in a misleading context. The source of the material must beacknowledged as Crown copyright and the title of the document must be includedwhen being reproduced as part of another publication or service.Any enquiries relating to the copyright in this document should be addressed toHMSO, The Copyright Unit, St Clements House, 2^16 Colegate, Norwich NR3 1BQ.Fax: 01603 723000 or e-mail: copyright@hmso.gov.uk End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.     FOREWORD This is the tenth in a series of six-monthly reports on the implementation of the Sino-British Joint Declaration on the Question of Hong Kong. It covers the period from 1 July to 31 December 2001. Hong Kong faced a testing time during these months. As an international centre for trade and finance,it was a¡ected by the world economic slowdown. And the repercussions of the terrible events of11 September in the United States were felt in Hong Kong as in so many places. I welcome the Special Administrative Region Government’s firm commitment to join the global fightagainst terrorism, and the positive part it has played in international e¡orts to tackle terrorist financing through its Presidency of the OECD’s Financial Action Task Force. Hong Kong’s skilful Chairmanship of another body, the General Council of the World Trade Organisation, was key in bringing about the successful launch of a new world trade round in Doha in November. It is encouraging to see the SAR playing a constructive role on the international stage, within the framework of the Joint Declaration and the Basic Law. Overall, our view remains that the concept of “One Country, Two Systems” is an everyday reality in Hong Kong. The rule of law and the independence of the judiciary, which are so vital to Hong Kong’s success, are being upheld. Essential rights and freedoms are being protected, and challenges to themfully and freely debated. We remain strongly committed to Hong Kong, reflecting both our historic responsibilities and a forward-looking relationship with an important partner in the region. We will continue to watch developments there closely. JACK STRAWSecretary of Statefor Foreign and Commonwealth Affairs SIX-MONTHLY REPORT ON THE IMPLEMENTATION OF THEJOINT DECLARATION ON HONG KONG INTRODUCTION1. This series of reports is a reflection of the British Government’s continuing interest inHong Kong, and of our commitment to the faithful implementation of the Sino-British Joint Declaration on Hong Kong. The Joint Declaration, signed in 1984, promised a high degree of autonomy for the Hong Kong Special Administrative Region (SAR) except in foreign and defence affairs, and guaranteed the continuation of Hong Kong’s social and economic systems, lifestyle and rights and freedoms. These reports provide an assessment of developments in Hong Kong, focusing in particular on the extent to which the Joint Declaration’s promises and guarantees are being realised in practice. TERRORISM2. Following the September 11 attacks in the United States, the SAR Government haspledged its full support in the global fight against terrorism and terrorist financing. Wewelcome this. Prior to September 11, Hong Kong had already enacted legislationimplementing United Nations Security Council Resolution (UNSCR) 1267, dealing withfinancing for the Taliban. On October 12, further legislation was passed implementingUNSCR 1333, which required States to freeze the assets of Usama bin Laden and hisassociates. The SAR Government is now giving urgent consideration to comprehensive new legislation to enable it to implement UNSCR 1373, which requires States to combatterrorism on a range of fronts. 3. Hong Kong currently holds the Presidency of the OECD anti-money laundering body,the Financial Action Task Force (FATF), and in October convened an extraordinaryplenary meeting in Washington at which the FATF agreed to extend its mission to coverterrorist financing. The meeting agreed eight special recommendations on terroristfinancing. Members are expected to comply with these by June 2002. HONG KONG SAR GOVERNMENT4. The Chief Executive of the SAR Government, Mr C H Tung, whose term of officeexpires on 30 June 2002, announced in December that he would run for a second five-year term. The election, by an Election Committee of 800 members from various sectors, is due to take place on 24 March 2002. Nominations for candidature are open from 15 to28 February. Candidates are to be nominated by at least 100 members of the ElectionCommittee. As of 31 December, no other candidate had come forward. 5. Mr Tung visited Beijing on 19 December to present his annual report to the Chineseleadership. He met President Jiang Zemin who, according to official media accounts, stated that the central authorities were satisfied with Mr Tung’s performance and would continue to give full support to his work. Mr Jiang also praised Mr Tung’s decision to stand for re-election and said that the Central Government wished him to continue to lead the SAR Government. Some in Hong Kong expressed concerns that open endorsement of Mr Tung’s candidacy by the Central People’s Government would in£uence the Election Committee or deter others from standing. Vice-Premier Qian Qichen was reported to have denied that the election was controlled, saying that members of the Election Committee were elected and represented the views of the public. 6. Controversy arose in July when Mr Yeung Kwong, who was actively involved in theanti-Government riots in Hong Kong in 1967, received the Grand Bauhinia Medal (the SAR’s highest honour). The SAR Government said that the award was in recognition ofMr Yeung’s contribution to the trade union movement. BASIC RIGHTS AND FREEDOMS7. Our last six-monthly report (Cm 5197) referred to controversy over the treatment ofFalun Gong, a group banned as a cult on the mainland but legally registered and allowed to carry on its activities in Hong Kong within the law. The report noted that the SARGovernment, while indicating that it would closely watch Falun Gong’s activities, had said that it did not, at present, intend to introduce anti-cult legislation. That position remains unchanged. Falun Gong followers have continued to be allowed to stage protests, although in November officials removed banners from protesters near the Liaison Office of the Central People’s Government on the grounds that they had caused obstruction. 8. More widely, the freedom to demonstrate has continued to be respected, with manygroups staging peaceful protests. In September, a magistrate acquitted three men who had been charged in connection with demonstrations in May during the Fortune Global Forum, which was attended by President Jiang Zemin. The men had scuffled with police officers who had tried to remove their vehicle. The magistrate said that the Police had had no legal power to tow away the vehicle and that the defendants were entitled to refuse to co-operate. 9. Dr Li Shao-min, a Hong Kong-based academic who was convicted by a mainlandcourt of spying and deported to the United States, was allowed to return to Hong Kong in July. Dr Li resumed his work at the City University of Hong Kong and in October waselected to the University’s Senate. The SAR Government’s decision to allow Dr Li to return was widely seen as an indicator of “One Country, Two Systems” working in practice. 10. The Hong Kong Journalists Association and the Article 19 Group (the GlobalCampaign for Freedom of Expression) published their ninth annual report on freedom ofexpression in Hong Kong in July. The report concluded that people in Hong Kong in large measure enjoyed freedom of expression and that the media continued to report oncontroversial issues. But it highlighted a number of concerns, particularly in relation to the SAR Government’s handling of Falun Gong; and called on the media to take action to deal with what it called a “credibility problem, arising from “ethical” excesses, self-censorship and internal measures to sideline journalists who are especially critical”. 11. In July/August, the UN Committee on the Elimination of Racial Discriminationexamined reports from China, including Hong Kong. We welcome the fact that HongKong’s report was prepared by the SAR Government and defended in Geneva by SARGovernment officials attending as part of a delegation from the People’s Republic of China. The UN Committee’s main concern in relation to Hong Kong was the lack of legislation against racial discrimination; it recommended that the situation should be thoroughly reviewed and appropriate legislation adopted. The SAR Government has reiterated that it is reviewing its position on legislation, with a view to determining the way forward in early2002. 12. In December, the right to education of mainland children in Hong Kong became thesubject of heated debate when it was reported that 187 children had been denied schooling. The children were “on recognisance” pending the outcome of right of abode litigation or removal proceedings. The SAR Government said that allowing the children to attend school would encourage others to enter Hong Kong illegally. The Government’s position was criticised by legislators and human rights groups, who argued that the children had the right to education under the UN Convention on the Rights of the Child, regardless of their status. The SAR Government subsequently undertook to review, on a case-by-case basis, applications for school admission by the children involved. CONSTITUTIONAL DEVELOPMENT13. Our last six-monthly report referred to the Chief Executive Election Bill, introduced by the SAR Government in March 2001 to provide for the detailed arrangements for the Chief Executive election in March 2002. The Legislative Council passed the Bill in July after intense discussion. There was controversy over a provision specifying that the Central People’s Government could remove the Chief Executive: some legislators criticised this as giving unnecessarily wide powers to Beijing and undermining Hong Kong’s autonomy. Mr Michael Suen, Secretary for Constitutional A¡airs, said that the new law “confers no additional power on the Central People’s Government to remove the Chief Executive from office”, and that “such a removal power can come only from the Basic Law”. 14. Our six-monthly report for January – June 2000 (Cm 4809) noted that theaccountability of senior officials had become a major issue of discussion in the wake of a public housing construction scandal, with some observers and politicians calling for the introduction of a Ministerial system of government. Our report for July – December 2000 (Cm 5067) noted that the Chief Executive, in his October 2000 Policy Address, hadannounced a review of certain issues of governance, including the accountability of senior officials. In his October 2001 Policy Address, Mr Tung proposed a new system of appointing principal officials, applicable to the top three secretaries (the Chief Secretary for Administration, Financial Secretary and Secretary for Justice) and most policy secretaries. Currently, nearly all such officials are civil servants, on permanent terms. Under the new system, they would be drawn from inside or outside the civil service and employed on contract terms, with their term of office not exceeding that of the Chief Executive who nominated them. They would be answerable to the Chief Executive, who would have the authority to recommend their removal. Consideration would be given to appointing them to the Executive Council. 15. The Chief Secretary for Administration, Mr Donald Tsang, said that the new principal officials would form a “political decision-making layer”, responsible for policy formulation, while the civil service would remain politically neutral, with responsibility for public administration. He said that the appointment of principal officials to the Executive Council would enable them to take part collectively in “a more conventional Cabinet-style system”. 16. Mr Tung has said that implementation of the proposals would be for the ChiefExecutive in the second term to decide; but that if he were re-elected, he would implement them from 1 July 2002. 17. Reactions to the proposals have been mixed. Some legislators and commentators have welcomed them; others have queried whether politically appointed “Ministers” would be accountable to the public, or only to the Chief Executive, who is not popularly elected. The Bar Association and Ms Margaret Ng, representing the legal constituency in the Legislative Council, expressed concern that the ability of the Secretary for Justice to act independently, particularly as regards prosecution decisions, might be compromised if the post became a political appointment. The SAR Government has said that the new “Ministers” would have to be individually responsible for any serious mistake, with resignation being an option; and that the proposed arrangements would not affect the Secretary for Justice’s constitutional duty to act independently in respect of prosecutions. 18. The Basic Law provides for “gradual and orderly” progress after 2007 towards theultimate aim of election of the Chief Executive and of all the members of the LegislativeCouncil by universal su¡rage. In his October 2001 Policy Address, the Chief Executivesuggested that the SAR Government would wish to review the experience of elections in2002 (for Chief Executive) and 2004 (for the Legislative Council) before consulting thepublic on the post-2007 constitutional structure. It remains our hope that Hong Kong will move as quickly as possible towards a fully directly elected legislature, and a democratically elected Chief Executive, at a pace in

US Congress hailed “One Country Two Systems” a success in Hong Kong

2002.02.22
A Better Hong Kong Foundation delegation returned to Hong Kong bringing back the good news that the US Congress had reaffirmed the successful implementation of One Country Two Systems in Hong Kong under the administration of the HKSAR Chief Executive, Mr. C.H. Tung. The Foundation mission came at the heel of the release of the 9th US Congressional Task Force Report on Hong Kong. The report acknowledged the core values of Hong Kong, including the rule of law, freedom of speech and assembly, and commitment to a free economy as they remain inseparably integrated into Hong Kong’s way of life. The Congressional task force took cognizance of Hong Kong as the freest economy in the world. At a meeting with the office of Congressman Doug Bereuter, the author of the Hong Kong report, the delegation was heartened to learn that the US Trade Representative commended Hong Kong as a model for other Asian economies attempting to deal with intellectual property rights piracy. The Congress report also praised Hong Kong as the “partner of the US in the anti-terrorist campaign” and expressed well-founded confidence in Hong Kong’s outstanding export control regime, which was regarded one of the world’s best. The delegation led by the Foundation Chief Executive, George Yuen, made its annual visit to Washington DC between Feb 12 –14, 2002. Among the delegates were Senior Counsel Daniel Fung, Vivien Chou, Director of Windsor Group and Founder of Integrated Medicine Holdings; and Oscar Chow, Director of Chevalier Group and a Foundation Council member. During the three-day visit in the US capital, the delegation had 16 appointments with important discussions with senators, representatives, staffers, senior US officials, and think tanks, such as the Brookings Institution, John-Hopkins University School of Advanced international Studies and the Citizens for Sound Economy. The delegation capitalized the high-level receptions at the National Economic Council and House International Relations Committee to relate a positive presentation on Hong Kong constitutional development and socio-economic strengths even in times of adversities. George Yuen noted that the visit was particularly timely as Congressman Bereuter had just released a Congressional report on Hong Kong. In addition, the Committee on International Relations, chaired by Henry J Hyde, was conducting a hearing on US Foreign Policy in East Asia, prior to US President George W Bush’s visit to northeast Asia from February 17 to 22. Mr. Yuen believed that the trip was an excellent opportunity to have discussions with congressmen and US state department officials on the agenda of President’s visit to China and its impact on Hong Kong. Sources close to the State Department indicated that the President’s visit would have a happy and useful agenda to foster an even closer tie between China and the United States of America. Mr. Yuen also added that the WTO issues would be discussed at the meetings of Chinese and US leaders. Daniel Fung, S.C., remarked, “In the Foundation’s subsequent meetings with US trade officials, they appreciated the value of regional integration, as it is viewed as a prod to accelerate US efforts to reach free trade agreements and deepen her integration across the Pacific. US officials are supportive of Hong Kong’s discussion to seek free trade agreement (now known as Closer Economic Partnership Arrangement (CEPA) with China as they regard it as a natural evolution of regional integration.” The group also held discussions with the National Economic Council on US economy. “It is gratifying to note signs of brisk business activities. The exceptional strong retail sales in January reflecting optimism in an early US recovery outweigh the concerns of accounting system weakness in corporation valuations in the market. That could bring positive effects on the global economy. It is hoped that Hong Kong order books would benefit from this turn around. However, we have to be cautious on the continued weakening of the Japanese yen.” Senior Counsel Fung asserted the gist of the discussion on US economy. The group urged the US Commerce Department to organize trade missions to Hong Kong as WTO had presented more opportunities for US small and medium sized companies to expand business in China through Hong Kong as their partners, because of Hong Kong’s knowledge of the emerging market, its culture and how business being conducted there. Ms. Vivien Chou welcomed the proposed senior level trade missions to Hong Kong organized by the US Commerce Department. She encouraged bilateral trade and investment, especially in the field of biotechnology and herbal medicine. “We are seeking partnership from the United States as we endeavor to establish world recognized standards for our bio-tech products and upgrade production facilities. Besides, we would like to collaborate with US universities, science and research laboratories on the development of bio-informatics,” “Definitely. I see more opportunities for US infrastructure corporations to expand their businesses in China with Hong Kong as their springboard,” said Mr. Oscar Chow, an active member of the Hong Kong General Chamber of Commerce and a delegate of HKSAR Go West mission led by Chief Secretary Donald Tsang in May 2001. After discussion with the US Water Environmental Federation, Mr. Chow expected many opportunities for US companies to market their environmental products and services in Hong Kong, China and South East Asia. “Hong Kong can play a useful facilitator in business development and consultancy services to meet varied market demands. It is my first trip with the Foundation to America. It has been an eye-opening exercise and a useful learning experience for me,” said Mr. Chow. The Foundation’s Chief Executive George Yuen concluded that this annual mission had again focused US opinion leaders and interlocutors on Hong Kong’s economic strengths, and her pivotal role in market development for US and other multi-national corporations, especially in their investment in China. For enquiries, please contact Mr. George Yuen of The Better Hong Kong Foundation at 2861 2622 or by fax at 2861 3361.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

The Speaker’s Task Force on the Hong Kong Transition

2002.01.30
Ninth Report January 30, 2002 Presented byThe Honorable Doug Bereuter, Chairman This is the ninth report of the Task Force on the Hong Kong Transition. It follows eight previous reports, the most recent of which was dated August 1, 2000. The report focuses on events and developments relevant to U.S. interests in the Hong Kong Special Administrative Region (HKSAR) between August 2000 and December 31, 2001. I. Introduction Four and one half years have elapsed since Hong Kong returned to People’s Republic of China (PRC) sovereignty on July 1, 1997. Notwithstanding the “One Country-Two Systems” commitment contained in the Joint Declaration, many observers openly wondered whether Beijing could resist the temptation to meddle in Hong Kong’s affairs. While some questions linger, most Western analysts conclude today that the “One Country-Two Systems” has permitted Hong Kong to maintain its unique character. Long-term success depends on preserving the quality and integrity of Hong Kong’s outstanding cadre of civil servants, the rule of law and an independent judiciary, the vigilance of an informed and public-spirited populace, and the continued commitment of Beijing to accept the spirit and letter of the Joint Declaration. Previous reports in this series have focused on political and economic events affecting conditions after the reversion. These matters, of course, continue to be important indicators of Hong Kong’s relative health. However, of greater interest for purposes of this report is how Hong Kong has responded to major recent global events. The global recession has touched virtually all economies, and Hong Kong’s is no exception. How it responds to the economic crisis will provide important insights into the long-term health of Hong Kong. Clearly, however, the most significant external event is the post-September 11th war on terrorism. As a major international financial center, Hong Kong’s willing participation is essential. The following report explores the manner in which Hong Kong has responded to these and other challenges. II. September 11th – The War On Terrorism The September 11, 2001, terrorist attacks upon the World Trade Center and the Pentagon marked a fundamental change in the U.S. perception of its foreign relations. As President Bush noted in his address to the nation of September 20, 2001, “Every nation, in every region, now has a decision to make. Either you are with us, or you are with the terrorists.” In responding to the President’s challenge, Hong Kong has unambiguously made it clear that it is on the side of the United States. Hong Kong political and business leaders have long felt a kinship with New York City. New York has been viewed as the center of capitalism, a role to which Hong Kong aspires in East Asia. This psychological bond is strengthened by the many Hong Kong families who have relatives living in New York, and the presence of firms headquartered in New York with branch offices in Hong Kong. In the days and weeks following the attacks, we witnessed an outpouring of sympathy from the people and leaders in Hong Kong. Chief Executive C.H. Tung offered full cooperation of the Hong Kong authorities. This cooperation began immediately and addresses concerns related to Hong Kong’s status as a financial hub, its role as a center of trade, and its position as a center for U.S. business and diplomatic activity. Hong Kong has fully implemented the relevant provisions of U.N. Security Council Resolutions (UNSCRs) 1267 and 1373. The UNSCR 1267 calls for the freezing of funds and other financial assets owned or controlled by the Taliban and Taliban affiliated activities. Resolution 1373 freezes the financial assets of Usama bin Laden, Al-Qaeda, and their associates. In addition, Hong Kong is undertaking the legislative changes to come into compliance with UNSCR 1373. Resolution 1373 calls upon nations to prevent financial activities of terrorists and criminalizes the willful provision and collection of funds for terrorist activities. Hong Kong participates in numerous international for a regarding illegal financial activity. A senior Hong Kong Government official currently serves as the President of the Financial Action Task Force on Money Laundering (FATF), an international group tasked with establishing a common front against money laundering. Hong Kong also is active in the World Custom Organization’s efforts to counter terrorism. Law enforcement authorities have the ability to arrest perpetrators of terrorist attacks and seize assets. Hong Kong police and customs authorities have established a special unit to address suspicious financial transactions. And, in contrast to the pre-attack United States, Hong Kong has legislation governing the actions of the underground “hawala” banks that are reported to have been a favorite conduit of the Al-Qaeda network. These hawalas are required to register with police and identify customers conducting transactions greater than US$2,500. Like financial institutions, hawalas are required to report suspicious transactions. In practice, ensuring that all hawalas register is a challenge. Given the large American diplomatic and business presence in Hong Kong, local law enforcement authorities have significantly enhanced their counterterrorist activities. The Hong Kong Government has assisted with additional security arrangements for U.S. personnel assigned to the U.S. Consulate General and visiting U.S. diplomats. Cooperation on security for U.S. Navy ship visits also has increased. Hong Kong Government officials and civic leaders recognize that assisting in the war against terrorism is in Hong Kong’s self-interest. Given its position as a technology and financial hub in Asia, and given the large number of multinational corporations that are represented in Hong Kong, it is possible that terrorists might view Hong Kong as a potential future target. Moreover, Hong Kong’s prosperity depends upon free and open trade in commodities and ideas, a concept that is anathema to modern terrorists. For these reasons, Hong Kong has been a willing partner in the ongoing war on terrorism. III. Economic Issues a. Economic Slowdown In 2001, the Heritage Foundation and the Cato Institute both found that Hong Kong enjoyed the world’s freest economy. Driven largely by a healthy export market, Hong Kong’s economy enjoyed healthy growth through 2000 and well into 2001. Indeed, Hong Kong enjoyed 10.5% growth in 2000, and 2.3% growth in the first quarter of 2001. However, hopes for continued high levels of growth have not materialized. Even before the events of September 11th, Hong Kong’s growth had slowed. By the spring of 2001, the drop in consumer demand in the United States and Europe had dramatically affected Hong Kong’s economy. Total merchandise exports and re-exports fell in the second quarter by 1.9% from the previous year. Real second quarter growth had slumped to 0.5% annual GDP growth, and the Hong Kong Government revised estimates downward to zero percent. Chief Executive Tung recently acknowledged that the Hong Kong Special Administrative Region (HKSAR) was facing “a few quarters” of negative growth. The economic fallout of the September 11th attacks placed additional strains on an already sluggish economy. The terrorist attacks have resulted in a predictable slowdown in U.S. consumer spending, which in turn reduced the demand for Hong Kong exports. By late fall the Hang Seng stock index had fallen more than 25% for the year, with particularly severe losses in September and October, though it recovered along with the U.S. stock market later in the year. The airline and tourist industries suffered an immediate increase in cancellations, and American participation in some fall trade fairs dropped significantly. In the days immediately following the attacks, approximately 8% of foreign tourists cancelled their reservations, and arrivals from the United States fell almost 25% from the previous year. In an effort to break free of the economic stagnation, Chief Executive Tung proposed a HK$15 billion stimulus package in October 2001 that featured property tax reductions and programs to create temporary jobs. Some critics in the Legislative Council (LegCo) have urged that Hong Kong’s large surplus be tapped for an even greater stimulus package. Hong Kong likely faces two or three quarters of recession in late 2001/early 2002. Unemployment, too, has become a concern. By the end of 2001, unemployment had risen to 5.5%, the highest level in eighteen months. While Hong Kong has escaped corporate collapses and massive layoffs, many firms have announced small-scale layoffs, affecting virtually all sectors of the economy. The relatively high level of unemployment and economic uncertainty continue to dampen consumer spending and domestic investor sentiment. The Government remains committed to making Hong Kong a high technology center. In support of this goal, it has dramatically deregulated the telecommunications sector. Many of the Government’s “Digital 21 Strategy” initiatives – first enunciated in 1999 to transform Hong Kong into an informational and technological hub – will go online in early 2002, including the first phases of a Science Park and the “Cyberport” project. Several multinational firms have signed tenant agreements with Science Park to establish headquarters and R&D operations there. While Cyberport claims to have obtained signed letters of intent from fifteen multinational firms (including Microsoft, IBM, Hewlett Packard, Cisco, Sybase, and Yahoo!) to become anchor tenants, none of these plans to move into the first phase of the project this year. Direct investment in Hong Kong by the United States totals over $23 billion, and bilateral trade totaled approximately $23 billion (down slightly from $26.1 billion in 2000). This level of investment is well above the same period in 1999 and Hong Kong remains our 15th largest trading partner (13th largest export market). Sectors having seen the greater growth include telecommunications, where liberalization has created new and exciting opportunities for U.S. firms in the areas of international telephone and broadcast services. The U.S. has also encouraged similar liberalization of Hong Kong’s civil aviation policies. The U.S. and Hong Kong conducted two rounds of informal negotiations on aviation issues last year. To date, however, these negotiations have yet to result in agreement. Hong Kong continues to resist granting commercially significant aviation rights to the U.S. passenger and cargo carriers despite its declared liberal air cargo policy. Hong Kong strongly supported the membership of the PRC in the World Trade Organization (WTO). The Government believes that the resulting WTO membership for China will enhance Hong Kong’s role as an entrepot for trade, increasing Hong Kong’s GDP by at least 0.5% annually over a 10-year period and bringing a host of new opportunities for Hong Kong. In particular, Hong Kong looks to exploit its ongoing integration with the Pearl River Delta. The Hong Kong SAR in its 1999/2000 report noted that “Hong Kong’s historic role as a financial center and trade entrepot, and its cultural and language ties, will provide and unmatched advantage to tap the potential of the Mainland market.” Some observers believe, however, that the agreement will result in increased competition for Hong Kong firms as the mainland seeks direct international trade and investment. Commercial and financial interconnectivity with the mainland is inevitable. Indeed, the Hong Kong Government has announced plans to negotiate a free trade agreement with the PRC. This evolution presents both challenges and opportunities. But how is Hong Kong to manage the growth of cross-border activities while at the same time preserving its separate identity? Striking the proper balance between separation and cooperation is one of the fundamental tasks faced by Hong Kong authorities. b. Intellectual Property Rights (IPR) Hong Kong continues to make progress in the fight against copyright piracy. Legislation was introduced and approved in the LegCo to control illicit production, reclassify IPR piracy as a serious crime, and criminalize corporate software license abuse. The 185-member Special Task Force established by the Customs and Excise Offices continues to perform effectively, and has been transformed into a permanent institution. As a result of these and other efforts, the U.S. Trade Representative (USTR) removed Hong Kong from the Special 301 list in 1999. The USTR now cites Hong Kong as a model for other Asian economies attempting to deal with IPR piracy. Sale of pirated discs has decreased in recent years, but remains a problem. In response to U.S. concerns, Hong Kong has made CD piracy an Organized and Serious Crime, enhancing penalties for piracy syndicates. Police and Customs have doubled their enforcement manpower and have conducted a series of aggressive raids targeting both the illegal production and retail outlet. In the first ten months of 2001, Customs officials seized 7.97 million pirated optical discs and arrested over 1,500 people. In addition, a number of illegal CD factories have been shut down, forcing traffickers to depend more heavily on imported products. Even as outstanding concerns are addressed, new problems emerge. Hong Kong is evolving into a center for electronic commerce and internet technology and new concerns have been raised about Hong Kong web sites that are used to sell and transmit pirated material. A number of establishments have been raided and charged with internet piracy, but none have gone to trial. However, Hong Kong has moved much more aggressively than its neighbors in addressing internet piracy. Hong Kong also has demonstrated a willingness to criminalize corporate use of pirated or unlicensed software. c. Export Controls Hong Kong is recognized as possessing one of the world’s best systems of export controls. Disappointing some outspoken critics of Hong Kong and the People’s Republic of China, the reversion appears to have had no major impact on the exercise of export controls. U.S. Government agencies continue to report no evidence of Chinese interference in Hong Kong’s export control system. Chinese officials have recognized that export control matters fall within the trade rather than the foreign policy area, thereby placing export controls within the Hong Kong Government’s exclusive purview. Hong Kong requires both import as well as export licenses, enabling authorities to track controlled commodities as they enter or leave the HKSAR. Hong Kong also refuses to issue re-export licenses for products unless it is sure that the original exporting country would export the product to the ultimate end user. The Hong Kong Government is extremely transparent regarding export controls and cooperates closely with many countries to ensure compliance with multilateral and country-specific export control regimes. Continued cooperation between HKSAR and U.S. Government officials helps strengthen Hong Kong’s export controls. Semi-annual meetings between U.S. and HKSAR officials have resulted in U.S. briefings on current trends and issues as well as relevant U.S. legislation. Hong Kong adheres fully to international control regimes such as the Nuclear Non-Proliferation Treaty, the Missile Technology Control Regime, the Nuclear Suppliers Group, the Australia Group, and the Wassenaar Agreement. U.S. Department of Commerce officials continue to conduct regular pre-license and post-shipment inspections as part of the dual-use licensing process. U.S. Department of State and Customs officials also carry out pre-license and post-shipment checks of munitions items under the “Blue Lantern” program. Hong Kong has not imposed any limitations on pre- or post-shipment verification by U.S. agencies and in some instances U.S. investigations have conducted multiple inspections to ensure that the end user remains in compliance with the original U.S. license. The 1999 Cox Commission noted the possibility of transshipment of sensitive technology via Hong Kong, and cited the lack of Hong Kong Customs inspections of People’s Liberation Army (PLA) vehicles when they cross the border. This resulted in Hong Kong reaffirming its commitment to maintain control over all cross-boundary movements, including the PLA. The commitment was demonstrated in March 2000, when customs officers discovered and held five armored vehicles on a vessel bound for China. The armored cars had been assembled in Ukraine and loaded into a container in Naples aboard a ship bound for the northern Chinese port of Tianjin. The vehicles had no import licenses. They were seized (and held for destruction) by Hong Kong Customs agents and three crewmembers including the captain were prosecuted under Hong Kong’s carrier liability system. The border between Hong Kong and the PRC is among the world’s busiest. For example, over 20,000 trucks traverse the Lok Ma Chau border crossing each day, and the line of vehicles awaiting inspection can extend for several miles. It is anticipated that China’s membership in the WTO will significantly increase this already considerable level of cross-border traffic. The resulting new pressures are causing Hong Kong authorities to consider new and innovative technologies to manage customs inspections. While acknowledging that Hong Kong’s export control regime is truly outstanding, it is nonetheless true that actual physical inspections of airborne, ship-borne and truck-borne cargo are extremely limited, with only a small percentage actually being inspected. Rather, Hong Kong Customs authorities depend upon intelligence information and case histories to develop individuals, cargoes, and modes of transportation that are most likely to be involved in the transportation of contraband. As with any government, export controls in Hong Kong depend on the intelligence, vigilance and integrity of the civil servants tasked with monitoring commercial traffic. Continued vigilance is required, but there appears to be no real threat to Hong Kong’s export control autonomy in the foreseeable future. Hong Kong continues to demonstrate its intention to maintain excellent export controls. One final concern relates to the October 2000 decision of the Hong Kong courts to dismiss charges stemming from the 1997 re-export of U.S. computers to a defense research institute at Chansha University in China. American and Hong Kong authorities cooperated closely in this matter; however, the Hong Kong court judged that there was inadequate evidence to prove an unauthorized re-export occurred. In a separate issue, the United States maintains an interest in a court case involving radiation-hardened computer chips that were shipped into China. This case, the Means Come prosecution, continues to be a matter of discussion between U.S. and Hong Kong authorities. IV. Political Issues a. Political Developments Under the Basic Law, that serves as Hong Kong’s Constitution, directly elected representatives to the LegCo from geographic constituencies now make up 24 of the 60 members. That member will increase to 30 in 2004. The Basic Law allows for (but does not mandate) the remaining 30 functional seats to be converted to directly elected positions and would permit direct election of the Chief Executive after 2007. The initial term of the Chief Executive, Mr. C.H. Tung, will conclude in June 2002. Selection of the next Chief Executive will be made in March by an 800-person committee that has been elected by business and professional leaders. It is expected by many that the selection committee will choose Chief Executive Tung to continue in his office for a second term. Support from Beijing dramatically increases the likelihood that Tung will remain in office, so much so that a credible opposition candidate may not emerge. In July 2001, pro-democracy legislators protested vigorously when legislation was approved regulating the selection of the Chief Executive. Critics objected to language that could be interpreted as permitting Beijing to remove the Chief Executive from office. The adoption of such a provision, it was argued, would be anti-democratic and would undermine the continued autonomy of Hong Kong. These concerns failed to sway the LegCo and the legislation was adopted. In addition, pro-democracy activists continue to lobby for a faster transition to a more democratic system. Leaders of each of the three major political parties have called for full democracy by 2008, arguing that the current political system is “unsustainable.” While such calls continued, no progress has been made toward the Basic Law’s goal of universal suffrage in the selection of the Chief Executive. Following a long and distinguished career, Anson Chan, Chief Secretary of the Civil Service, retired in April 2001. Ms. Chan long had been regarded as a key spokesperson for Hong Kong’s autonomy. As the public face of Hong Kong’s Civil Service, she had conveyed a sense of quiet professionalism that was reassuring to interested observers. Thus, selection of a successor was seen as an important signal of Hong Kong’s direction. Therefore, the selection of the highly respected former Financial Secretary, Donald Tsang, to serve as the new Chief Secretary seems to demonstrate an intention to continue in this tradition. Mr. Tsang’s appointment was been warmly received by most people in Hong Kong, and also by the HKSAR financial markets. During the past year the PRC arrested a number of visiting American academics and charged them with espionage. One such American was Li Shaomin, a teacher at Hong Kong City University. In August 2001, after his conviction and expulsion from the PRC, Li Shaomin was permitted to return to Hong Kong to complete his reaching contract with City University. In December, however, the university decided that Mr. Li would not receive his salary for the period of his detention in the PRC. b. Judicial Independence / Rule of Law Four years after reversion to PRC sovereignty, Hong Kong’s legal institutions continue to function well and the rule of law continues to be respected in practice. A high priority has been placed on ensuring that legal institutions are properly supported. In particular, appointments to the bench have been of the highest caliber. Notwithstanding the generally positive situation, the aftereffects of the “Right of Abode” case continue to be felt. The issue is a fundamental one that goes to the core of the “One Country, Two Systems” principle and the powers enunciated in the Basic Law. The Right of Abode case actually is a series of legal cases related to the immigration regulations for children of Hong Kong citizens born out of wedlock. In 1999, the Court of Final Appeal (CFA) declared that all children of Hong Kong residents had the right of abode in Hong Kong. Fearing that the ruling would result in an influx of 1.6 million new immigrants, the Hong Kong Government asked the Standing Committee of the PRC National People’s Congress (NPC) to interpret sections of the Basic Law relevant to the Right of Abode ruling. The NPC interpretation did not affect the original litigants in the case, but it did overturn the prescriptive effect of the CFA judgment and reduced the number of people eligible for right of abode in Hong Kong. While fully permissible under the Basic Law, relying on the NPC to overturn a decision of the Hong Kong courts has raised concerned with some civil libertarians. In July 2001, the CFA ruled on a series of abode cases, upholding the Hong Kong Government in two cases and ruling against the Government in a third. In doing so, the Court demonstrated its intention to broadly interpret areas of Hong Kong autonomy and rejected Government suggestions that it seek legal interpretations from the NPC. The Hong Kong Government chose not to appeal to the NPC in the court case that they lost. In declining to challenge the ruling that went against them, the Hong Kong Government has reinforced the independent rule of law tradition and answered many of the questions raised in the initial Right of Abode controversy. In January 2002, the CFA ruled on the last major set of abode cases, rejecting the appeal from most of some 5,000 plaintiffs. The CFA, however, did uphold the appeal for some claimants (perhaps as many as 1,000) on the grounds that the government had created “legitimate expectations” that their cases would be dealt with in accordance with the original (pre-interpretation) CFA decision of January 1999. c. Freedom of Expression / Press The people of Hong Kong continue to enjoy a tradition of free speech and free press. Political debate is dynamic and raucous. Thousands of demonstrations or petitions have been organized since the reversion and the number of protests has increased. A wide and diverse range of opinions, including those critical of the Hong Kong and PRC Governments, are routinely aired in the mass media and public for a. There are sixteen major daily newspapers, four commercial television stations, and two commercial radio stations. These media function with almost no government control. Despite the wide variety of outlets, there is a general perception both among journalists and the public that a measure of self-censorship is exercised. According to the Department of State Country Reports on Human Rights Practices for 2000, “there is a widely shared perception of a need for special care toward topics of particular sensitivity to China or Hong Kong’s powerful business interests, such as leadership dynamics, military activity, Taiwanese or Tibetan independence, or powerful businessmen’s relations with the mainland Government.” d. Freedom of Religion The Basic Law guarantees freedom of religion for the people of Hong Kong. There are some 600 Buddhist and Taoist temples, 800 Christian churches, 4 mosques, a Hindu temple, a Sikh temple, and a synagogue. The Department of State International Religious Freedom Report of October 2001 has concluded that: “the Government at all levels generally protects religious freedom in full, and does not tolerate its abuse, either by governmental or private actors.” Of particular note is the fact that practitioners of Falun Gong – who do not consider themselves to be part of a religion – continue to practice freely and organize political protests. Adherents of Fulun Gong have been permitted to conduct activities in Hong Kong, but the level of public tolerance has declined following the self-immolation of alleged Falun Gong practitioners in Beijing in December 2000. Since that time, mainland authorities have unambiguously and with some success sought indirectly to limit this group’s activities in Hong Kong. Articles critical of Falun Gong have appeared in PRC-owned newspapers in Hong Kong, and Chief Executive C.H. Tung described Falun Gong as an “evil cult.” In comments that clearly were directed at both Hong Kong and Macau, PRC. President Jiang Zemin stated that local authorities should not permit activities designed to create divisions with the mainland. In the weeks and days before a major international conference in May 2001, Hong Kong authorities denied entry to a number of Falun Gong practitioners, including some Americans. In the immediate aftermath of the conference, press reports indicated that the Hong Kong Government was considering “anti-cult” legislation. However, the Hong Kong Secretary of Security has stated, and Chief Executive Tung has confirmed, that the Government has no intention of pursuing anti-cult legislation at this time. In August, a number of Falun Gong practitioners were arrested when they moved beyond the permissible protest area and staged a public demonstration in front of the PRC’s liaison office in central Hong Kong. These individuals were held for several hours and released without being charged. While Beijing’s primary concern was directed toward Falun Gong, the PRC also sought, unsuccessfully as it turned out, to limit the visibility and influence of the Catholic Church in Hong Kong. When the Vatican canonized Chinese Catholics martyred in China, PRC officials in Hong Kong urged that any celebrations be “low key.” The celebrations, however, went on as scheduled and without incident. e. Ship Visits U.S. military ship visits and aircraft stopovers in Hong Kong fall within the purview of the PRC. Hong Kong Government spokesman Stephen Lam has noted that Hong Kong welcomes the contribution that ship visits make to Hong Kong’s tourist industry. Beijing has used ship visits as a means to demonstrate satisfaction or displeasure at the state of U.S.-PRC relations. Following the accidental bombing of the Chinese Embassy in Belgrade in May 1999, PRC authorities denied U.S. port visits and aircraft stopovers and visits to Hong Kong. After more than a two-month ban, the Chinese Government again began granting permission for such visits. Requests quickly returned to their pre-bombing levels. Visits were again suspended following the EP-3 collision with a PRC fighter aircraft off Hainan Island in April 2001. Visits resumed in July, 117 days after the incident, with the visits of the U.S.S. Guardian and the U.S.S. Patriot. The aircraft carrier U.S.S. Constellation made a port call in August. In December, permission was granted for visits by the aircraft carrier U.S.S. John Stennis and the flagship of the Seventh Fleet, the U.S.S. Blue Ridge. V. Macau Like Hong Kong before it, Macau reverted to Chinese sovereignty on December 20, 1999, under the “One Country, Two Systems” model. Macau’s high degree of autonomy and way of life are protected for fifty years under the 1987 Sino-Portuguese Joint declaration and Macau’s 1993 Basic Law. The PRC has largely respected its commitment regarding autonomy. With a much smaller population and economy than Hong Kong, there has been less controversy and commentary in the United States over Macau’s situation. Crime, particularly organized crime syndicates (triads) fighting for control of the gambling and vice trade, had been a major problem in Macau. The reversion of Macau to Chinese sovereignty has apparently reduced the magnitude of the crime problem in Macau. This improvement has been attributed to better police training and discipline, the successful prosecution of key triad leaders, and closer cooperation between Macau legal and police authorities and those in Guangdong province. Textiles dominate Macau’s exports market, comprising 80% of all exports. The illegal transshipment of textiles produced elsewhere through Macau has been a major concern. A September 2000 Memorandum of Understanding with the United States is designed to enforce existing textile quotas and prevent transshipment. Macau has made major improvements in its IPR anti-piracy regime and was moved from USTR’s priority watch list to the watch list in April 2000. However, the existing judicial process is cumbersome and has little deterrent effect, and enforcement needs to be further strengthened. Chief Executive Edmund Ho has pledged to work closely with the United States to address the issue. Money laundering through Macau’s casinos and trading companies also remains a concern to U.S. law enforcement authorities. Prior to Macau’s reversion to the mainland, reports had surfaced indicating that the government of North Korea has used Macau as a transshipment point for counterfeit U.S. currency. North Koreans also have long been suspected of exploiting their diplomatic presence in Macau to sell drugs and weapons for hard currency, and using Macau as a training ground to prepare intelligence officers for undercover operations. Concern remains that these illegal activities continue. The new government in Macau has expressed its support for an open civil society, and the judiciary remains independent. However, with the exception of the legislative assembly, democratic institutions remain weak. Fundamental human rights, including the freedom of assembly, speech, association and religion, are guaranteed in the Basic Law. However, in what was viewed as a direct criticism of Falun Gong, PRC President Jiang Zemin noted in December 2000, that the Macau Government should not permit anyone to stage activities in Macau against the Central Government or to split the country. Despite heavy-handed treatment and limits upon entry, members of the Falun Gong generally are allowed to continue to follow their precepts. VI. Conclusion Four and one-half years after Hong Kong’s reversion to Chinese sovereignty, the unprecedented “One Country, Two Systems” experiment thus far continues to be a success, albeit a success that continues to face many challenges. Despite a worldwide recession, Hong Kong remains a bastion of free-market capitalism, as shown by its ranking as the world’s freest economy in the Heritage and Cato reports. Hong Kong’s business and political leaders appear determined to devote the capital and resources to ensure the SAR remains one of the driving forces of Asian economic growth. Hong Kong continues to formulate an independent economic policy and maintains its own membership in international economic organizations. Hong Kong’s excellent system of export controls remains intact, but will continue to be stressed as cross-border trade increases. While Hong Kong maintains its substantial progress in protecting intellectual property rights, more could be done and close attention is required. The United States also continues to voice concern about Hong Kong’s civil aviation policy. Hong Kong’s political system is evolving, but at a slower pace than pro-democracy advocates (and the majority of the Hong Kong people, according to polls) would wish. The media remains free and comments critically on the Government and the PRC; however, concerns arise about self-censorship in anticipation of PRC disapproval. Demonstrators exercise the right to freedom of speech and assembly. Vigorous debate over the appropriate degree of autonomy for Hong Kong persists, most recently regarding conditions for the selection or removal of the Chief Executive. If Beijing chose, as critics fear, to remove some future Chief Executive, confidence in Hong Kong’s future would be seriously undermined. The initial Report to the Speaker on the Hong Kong Transition, dated October 1, 1997, observed that the initial phase of the reversion to China could be categorized as “so far, so good.” That first report concluded: It is too early to judge the reversion. Nonetheless, indications to date are hopeful. Civil liberties continue largely unaffected. The economy continues to thrive. U.S. ship visits continue with little change and are, indeed, welcomed with open arms. However, we continue to be concerned about the potential over time for the constriction of democracy, media self-censorship and the loss of hard-won rights. Chinese and Hong Kong authorities are acutely aware that the eyes of the world continue to scrutinize their post-reversion actions. In the intervening years, the economy has been buffeted by recession, and ambiguities in the Basic Law have posed serious challenges for Hong Kong authorities. At its core, however, this initial assessment remains valid. With the benefit of five years’ experience since Hong Kong’s reversion, Hong Kong’s transition from U.K. colony to PRC Special Administrative Region can be judged a qualified success, noting that significant challenges continue to face Hong Kong’s leadership and people in preserving the “high degree of autonomy” promised in the Basic Law.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

The Better Hong Kong Foundation’s Mission to U.S. – A Resounding Success

2001.07.03
A Better Hong Kong Foundation’s delegation has just returned after a successful 7-day mission to the United States, between June 19 and 25, 2001. As part of continuous efforts in keeping Hong Kong a prominent business spot on the world map, the Foundation’s visit serves to update American opinion-leaders and interlocutors on Hong Kong. The mission, led by Mrs. Nellie Fong, Chairman of the Executive Committee, includes: Foundation Trustee, Group Managing Director of Lam Soon (Hong Kong) Ltd., Mr. Jim Tsao, Senior Counsel Mr. Daniel Fung, Hong Kong Productivity Council Chief Executive Mr. Thomas Tang, Goldman Sachs Managing Director Dr. Fred Hu, Wilkinson & Grist Consultant Ms. Anne Chen, and Salon Films Managing Director Mr. Fred Wong. The mission visited Washington D.C., New York and Los Angeles. Delegates presented to the United States administration, congressmen, business leaders, think tanks and media with the latest political and economic situation of Hong Kong, its investment outlook especially against the background of China’s imminent accession to the World Trade Organization (WTO). Delegates also met with the top management of U.S. famous corporations, including Citibank Vice Chairman, Mr. Bill Rhodes, Goldman Sachs Vice Chairman Mr. Robert Hormats, Standards & Poor’s President, Mr. Leo O’Neil, and Fortune Digital President, Mr. John Needham. The mission also visited Nasdaq, Disneyland and Universal Studio. Delegation leader, Mr. Nellie Fong described the mission a resounding success as manifested by a series of high level meetings with the U.S. officials, congressmen and their aides in Washington D.C. and top corporate CEOs in New York. They reasserted that Hong Kong’s one country two systems principle had been working very well. They were impressed by the present administration under Mr. C. H. Tung, in times of adversities especially during the Asian economic crisis and its aftermath. The U.S. interlocutors reiterated that better U.S.-China relations would mean a better Hong Kong. Hence, the HKSAR would continue to assume an important role to facilitate friendly exchanges of U.S. and China opinion leaders and to foster a better understanding between two countries. Mrs. Fong added that the foundation would continue its activities in the U.S. and would assist in arranging congressional and media visits to China and Hong Kong. Foundation’s Trustee, Mr. Jim Tsao expressed confidence in the China’s accession to the WTO, the U.S. and China’s trade negotiators came to agreement on the way forward. With Mr. Tsao’s company, Lam Soon (Hong Kong) Group, being one of the largest importers of U.S. wheat in China, his assessment on the opinion of the WTO was insightful and well received. Mr. Tsao believed that the successful conclusion of the WTO talk between China and U.S. would bring prosperity to both countries and hence would benefit Hong Kong. Another delegate, Senior Counsel, Mr. Daniel Fung articulated the strength for Hong Kong’s continued top rank as the freest economy in the world. The level-playing field practice, the WTO business compliance, the zero tolerance for corruption, the rule of law and the free flow of information made up the formula for Hong Kong’s success. Mr. Fung further remarked, “In keeping abreast with today’s knowledge economy and trade globalization, Hong Kong is expanding its business portfolio to embark on a bold and visionary infrastructure development on technology and innovation such as Cyberport and science parks. Beside, mission-critical education and human resource policy and strategy package to upgrade the quality of our work force is of paramount importance. More significantly, Hong Kong’s integration with the Pearl River Delta would create favourable investment environment and business opportunities to multinational corporations and Hong Kong companies.” Delegate Mr. Thomas Tang capitalized the visit to promote the World Congress on Productivity to be organized by his council in Hong Kong in early November. The World Congress would attract 1,500 delegates from over 40 countries. Additionally, Mr. Tang initiated partnership discussions with U.S. business associations so as to make strategic alliance in promoting business exchanges between small-medium enterprises in the U.S. and Hong Kong with propensity to expand activities in China. Both Dr. Fred Hu and Ms. Anne Chen agreed that the U.S. economy had great impact on Hong Kong’s growth. They expected after China’s accession to the WTO, Hong Kong servicing and financial sectors would make a significant contribution to generating more brisk U.S. and China business activities through interactions with Hong Kong. Salon Films Director Mr. Fred Wang expressed renewed confidence in Hong Kong’s film industry. As the success of the Oscar winning award film “Crouching Tiger and Hidden Dragon” had re-ignited Hollywood producers’ interest in Asia, they would use Hong Kong as their logistics base, and as a springboard into China location filming and joint production. The Foundation’s Chief Executive, Mr. George Yuen thanked U.S. government and congress for giving the delegation such a high-level and warm reception. He also gratefully acknowledged the support of the Hong Kong Economic Trade Office for the visit. “Equally important, we have a great team in our successful endeavours to the United States as everybody did an excellent job in conveying the right message.” Mr. Yuen added, “We all took part in over 30 useful dialogues pivotal to future co-operation, business ties and educational exchange. We will keep up our good efforts and build on our relations with opinion leaders, business community, research institutes, non-government organizations overseas for the economic health and public well-being of Hong Kong.”   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Survey Finds Hong Kong vs Shanghai Competitiveness No Zero Sum Game

2001.05.04
A “City Competitiveness: Shanghai and Hong Kong” survey shows that at this point in time Hong Kong is still ahead of Shanghai in terms of many competitiveness indicators, and is overall a more competitive international city. The survey, conducted by the Committee on China Research & Development of The Chinese University of Hong Kong with assistance of The Better Hong Kong Foundation, also shows that Shanghai leads Hong Kong in certain areas, and that the “Base for Sustainable Economic Growth” of the two cities are narrowing. Mr. George Yuen, Chief Executive of the Foundation said, “Present indicators are that both Hong Kong and Shanghai are equipped for being an international city. They both have their advantages to attract investment from multi-national corporations, which is very beneficial to China’s economic development. With its established competitive edges, Hong Kong will be able to continue its position as a leading international city in the Asia Pacific Region.” The survey was conducted in Hong Kong and Shanghai between December 2000 and January 2001. The 193 respondents included chief executive officers of multi-national companies in both cities, and professionals and senior managers in Hong Kong. They were asked to rate the achievements of Hong Kong and Shanghai on 32 indicators on international city’s competitiveness. The 32 indicators were adopted and modified from the ‘Indicators Systems for National Competitiveness’ developed in 1999 by the World Economic Forum and International Institute for Management Development. Respondents were requested to score from 5 (best) to 1 (worst) on three basic dimensions: the “Base for Sustainable Economic Growth”, “Investment Environment” and “Image of Globalization”; and 6 major components with 14 factors in measuring city competitiveness including “Production Factors”, “Policy for Social-Economic Development”, “Environment for Business Operations”, “Environment for Living” and “Investment Policy”. The results showed that Hong Kong led Shanghai in all three basic dimensions and other factors, and was, in general, more competitive as an international city. The general score for Hong Kong is 3.75, whilst Shanghai scores 2.96 (5 is the full score). Despite Hong Kong was generally perceived as more competitive, the survey indicated that the two cities had equal advantage on “Technology Base”, where Hong Kong was rated 3.226 lagging behind Shanghai with a rating of 3.294. Amongst the three factors in “Technology Base”, the two cites’ performances were similar in terms of “close linkages amongst local universities and other research institutions in research and development activities”. However, Shanghai was shown to have significant advantages over Hong Kong on the item of “commercialization of local research and development achievements”, and vice versa on “prospective in local e-commerce/internet information technology”. Hong Kong had the best score in “Environment for Business Operations”. All 4 measuring factors were significantly ahead of Shanghai, namely: “Rule of Law” (Hong Kong: 4.134, Shanghai: 2.503), “Administration of Economic Affairs” (Hong Kong 3.902, Shanghai: 2.269), Market Openness (Hong Kong: 4.170, Shanghai: 2.338), Labour (Staff Cost, Industrial Relations etc.): (Hong Kong 3.704, Shanghai: 3.339) The research team leader, Professor Tuan Chyau of the Committee on China Research & Development of The Chinese University of Hong Kong, said, “Despite Hong Kong is leading Shanghai in a wide range of indicators, we must make allowance that Shanghai has only been opened for 20 years, its performance as reflected by some of the figures in its socio-economic status worths our appreciation. Hong Kong has a lot to learn from Shanghai.” The survey also found that the rise in average price levels in Shanghai was more than doubled that of Hong Kong because of a long period of speedy growth. Researchers believed this factor might affect Shanghai’s costs competitiveness in a longer term. Professor Tuan added that “More importantly, the basic dimension of “Base for Sustainable Economic Growth” between the two cities has closed up to 10.7%. Researchers consider this, in the long run, will have material influence on the competitiveness of the two cities. Researchers reckoned, as Hong Kong is located at Pearl River Delta in Southern China; and Shanghai located at Yangtze River estuary in Eastern China, both serve two main river regions, and act as the gateway to the world for China. Their fundamental development strategy, apart from strengthening their bases for sustainable economic growth, is to integrate economic ties with neighbouring regions of developed cites, so as to expand their economic influence. The Foundation’s Chief Executive, Mr. George Yuen, remarked, “At present, Hong Kong capitalize on the advantages of having a free market economy, ‘the one country two systems’, and a positive international image. As we face more challenges from other cities and regions, Hong Kong should review its policy on strengthening local economic sustainable growth, and provide more effective measures to enhance competitiveness. Pyramid of City Competitiveness (PCC) A Conceptual Model of An International City’s Competitiveness   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

The Better Hong Kong Foundation’s 4-Nation Study Mission to Europe a Goodwill Forge For Ties And Opportunities

2000.11.29
The Better Hong Kong Foundation’s delegation has just returned after a successful 8-day mission to Germany, Finland, Sweden and the Netherlands. This mission signified the importance that Hong Kong’s major trading partners in Europe, attached to Hong Kong’s geo-economic position and their confidence in its people and business strength in Asia. Delegates presented state secretaries, ministers, senior government officials and business leaders in host countries with the latest political and economic situation of Hong Kong, its investment outlook and development on technology and innovation. During the visit, the delegation also held discussions with influential think tanks and non-government organizations on issues of common interest and mutual concerns. Delegates also met with the senior management of world famous corporations, including Germany’s DaimlerChrysler and Siemens, Finland’s Nokia, Sweden’s Ericsson and Dutch Philips. The mission toured science parks in Berlin, Stockholm and Amsterdam, and discussed Hong Kong’s partnership prospects with them. The group also addressed at luncheons and dinners hosted by important forums and business associations in Berlin, Munich, Helsinki, Stockholm and Amsterdam. Delegation leader and Foundation’s Chief Executive, George Yuen described the mission a tremendous success as Hong Kong had a content-rich and laudable story to tell and continued to capture the interest of its major trading partners in Europe. “Clearly the visit has been an eye-opening experience for there are so many to learn especially on issues such as human resource and research and development, being key components in building a successful technology and innovation hub since Hong Kong is working towards this goal. The mission has also established links with major think tanks and NGOs on future educational exchange and business partnership.” Mr. Yuen added. Among the delegates were distinguished members in Hong Kong’s business and academic communities, including Professor LAU Siu Kai, Associate Director, Hong Kong Institute of Asia Pacific Studies, the Chinese University of Hong Kong; Professor Francis LUI, Director, Centre for Economic Development, Hong Kong University of Science and Technology; Mr. Daniel FUNG, Senior Counsel, Des Voeux Chamber and former Solicitor-General, Hong Kong Government; Mr. Peter LO, CEO, Provisional Hong Kong Science Park/Hong Kong Industrial Estates and Hong Kong Industrial Technology Centre; Dr. SUDIRTO, President Director, PT Bomar Securities, a member of the CP Group; Ms. Anne CHEN, Partner, Wlkinson & Grist; and Ms. Bing-ling CHOW, Vice President, Wong’s Electronics. For the first time, a Hong Kong Government Principal Investment Consultant from Hong Kong Economic & Trade Office in Europe, Mr. Y. C. TAM, had joined the Foundation-led business mission. At public forums and business meetings, Professor Lau briefed the interlocutors on Hong Kong’s constitutional development, major social issues after the Handover, public aspirations and political landscape in years ahead. Professor Lui asserted the importance of Hong Kong in Asia Pacific as an international business centre and a gateway to China. Foreign investors would benefit from their investment and partnership with Hong Kong corporations or using it as a regional base to China. China’s imminent accession to WTO would provide even greater business opportunities for Hong Kong, especially in the financial and service sectors, for there would be many more and bigger commercial activities to be realised in much vigor. As a keynote speaker at business gatherings, Mr. Daniel Fung articulated the four pillars of strength for Hong Kong’s continued top rank as the freest economy in the world. The level-playing field practice, the WTO business compliance, the zero tolerance for corruption and the rule of law make up the formula for Hong Kong’s success. Mr. Fung further remarked, “In keeping abreast with today’s knowledge economy and trade globalization, Hong Kong is expanding its business portfolio to embark on a bold and visionary infrastructure development on technology and innovation, such as Cyberport and science parks, and a mission-critical education, and human resource policy and strategy package to upgrade the quality of our work force.” Delegate Peter Lo capitalised the visit to introduce his three related technology and industrial organizations to business communities and prospective clients. Additionally, Mr. Lo had initiated partnership discussions with the science parks in the host countries. Mr. George Yuen thanked the governments of host countries and their consuls-general in Hong Kong for organising such a high-level visit. He also gratefully acknowledged the support of the Hong Kong Trade Development Council for the visit. “Equally important, we have a great team in our successful endeavours to Europe as every body did an excellent job in conveying the right message. Mr. Yuen added, “We all took part in useful dialogues pivotal to future co-operation, business ties and educational exchanges. We will keep up our good efforts and build on our relations with opinion leaders, business community, research institutes, non government organizations overseas for the economic health and public well-being of Hong Kong” For enquiries, please contact Ms. Jocelyn Cheung, Better Hong Kong Foundation by telephone at (852) 2861-2622, fax at (852) 2861-3361 or by Email: jocelyn_cheung@betterhongkong.org   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Eleven HK & Mainland Companies Join Forbes 300 Best Small Companies

2000.10.16
A commendation ceremony for five Hong Kong and six Mainland companies selected by Forbes Magazine to be among the 300 Best Small Companies was jointly organized today by the Hong Kong Productivity Council (HKPC), the Hong Kong General Chamber of Commerce (HKGCC), and The Better Hong Kong Foundation (BHKF). The ceremony was officiated by Mr Lawrence Minard, Editor of Forbes Global; Mr Joshua Law, Director-General of Trade & Industry, HKSAR Government; Mr Thomas Tang, Executive Director of HKPC; Dr Eden Woon, Director of HKGCC; Dr Aron Harilela, Member of Advisory and Executive Committee of BHKF; and Mr George Yuen, Chief Executive of BHKF. Among the list of the 300 Best Small Companies are Technology Venture Holdings Ltd, Caf?de Coral Holdings Ltd, Computer & Technologies Holdings Ltd, Kingboard Chemical Holdings Ltd and Global Sources Ltd from Hong Kong, as well as six Mainland companies, including Asiainfo Technologies (China) Inc, China Vanke Co Ltd, Netease.com Inc, Sun Television Cybernetworks, Sina.com, and Sohu.com. In addition, two of these companies – Global Sources Ltd and Sun Television Cybernetworks – have been elevated to Forbes’ 20 for 2001, the ultimate “star performers” among the 300. Chairmen and CEOs of the winning companies were presented certificate of merits by Mr Lawrence Minard of Forbes Global who flew in to Hong Kong especially for the occasion. “Candidates have to meet a very high standard set in the selection process. The magazine not only looks at a candidate’s performance indicators of the past three years, but also its prospects as a strong performer in the years to come. We also polled money managers, securities analysts and entrepreneurs around the world for their choices,” said Mr Minard. During the ceremony, representatives of the winning companies also received a Powerhouse Hall of Fame Trophy from Mr Joshua Law to recognize their outstanding achievements. The Powerhouse is an integrated facility established by HKPC to provide best practices business solutions to enhance the competitiveness of local businesses. Mr Thomas Tang, Executive Director of HKPC said, “As winners, they have become role models for Mainland and Hong Kong enterprises, setting new standards of excellence and spearheading the way forward for local companies to capture the vast opportunities offered by the new economy.” The commendation ceremony was attended by Chairmen and CEOs of winning companies, business leaders and representatives from trade associations.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Pragmatic Policy to Build a Harmonious Society

2000.10.11
Chief Executive Tung Chee-hwa presented his fourth Policy Address, Serving the Community, Sharing Common Goals, today. Experts from various sectors welcomed the Policy Address, describing it as comprehensive and pragmatic in proposing a series of policies to improve the standard of living and economy in Hong Kong. The Better Hong Kong Foundation held a discussion on the Chief Executive’s Policy Address. Five opinion leaders from various fields were invited to the forum. They were: Professor Lau Siu-kai, Associate Director, Hong Kong Institute of Asia-Pacific Studies, The Chinese University of Hong Kong Professor Francis Lui, Director, Center for Economic Development, Hong Kong University of Science & Technology Johnny Ho, Chairman, The Hong Kong Small and Medium Business Association Angus Tsang, Executive Director, The Hong Kong Society for the Aged Andy Ho, Managing Director, iChannel.com Ltd. and political commentator George Yuen, Chief Executive, The Better Hong Kong Foundation, moderated the forum. Professor Lau Siu-kai described this Policy Address as positive, saying, “the Government reiterated the importance of a free economy and fair competition while being responsive to public concerns and committed to tackling society’s problems.” He continued, “although the policies would take time to accomplish, we should be patient and believe in the long-term development of our society and economy.” Professor Lau also pointed out that, “applying executive accountability to the present civil service system would ensure the performance of senior Government officials to the highest standard so as to boost public confidence.” Professor Francis Lui opined that the Policy Address had spelt a clear direction for Government policy in years ahead. He asserted, “the future of the economy relies heavily on technological development. Mr. Tung is insightful to emphasize the importance of the knowledge-based economy for Hong Kong.” Professor Lui remarked, however, that the Government should be cautious when executing these policies. Responsible bureaus and departments should coordinate to ensure their implementation. He also believed that China’s imminent accession to WTO would further benefit Hong Kong’s economy, especially the service sector. Professor Lui agreed with the proposal of importing professionals. He said, “instead of being over cautious, we should adopt a more open attitude towards this matter similar to that of the US, Europe and Singapore in their immigration policy to attract professionals.” Johnny Ho welcomed the Government for setting an allocation of two billion dollars to provide further support for small and medium-sized enterprises. “Although the Policy Address does not give details,” he said, “it attaches great importance to SMEs in Hong Kong’s economy and their commitment to improving the investment environment.” He hoped the Government would consider increasing funding for loans to meet the increasing demand of SMEs. Andy Ho said, “the Chief Executive has presented a well-considered Policy Address with means and measures to build a cohesive and harmonious community.” He also complimented on the improved presentation skills of Mr. Tung during his reading of the Policy Address. Angus Tsang found the Policy Address to be coherent and pragmatic. He pointed out, “though Mr. Tung did not adopt any revolutionary social welfare policy, it was practical and would alleviate social problems in time. It indicated the willingness of the Government to help the poor and needy.” He suggested Government look at the growing aging population and provide relevant programs and services to match the anticipated demand. George Yuen concluded, “this year’s Policy Address covers a number of critical social issues. Among others, provision of quality education and retraining for our working population are pivitol to transforming Hong Kong into a knowledged-based economy.” He praised Government for encouraging volunteerism in offering assistance and service to the underprivileged in society. He said, “this would make Hong Kong a harmonious society.” The Better Hong Kong Foundation will provide the Chief Executive’s office and relevant Bureaus with a report on the forum.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Hong Kong Together Supports 2006 Asian Games

2000.08.17
Hong Kong Together and the Hong Kong Federation of Trade Unions plan a Signature Campaign, Asian Games Parade and Hong Kong-Southern China Canoe Adventure to support Hong Kong’s 2006 Asian Games bid. George Yuen, Chief Executive of The Better Hong Kong Foundation and Convener of Hong Kong Together said, “Hong Kong Together was formed to unite Hong Kong in reinforcing the cohesiveness and understanding in the community. Through these activities we wish to show that Hong Kong people are committed to supporting the bid for the 2006 Asian Games.” The Signature Campaign will be held on August 19, 2000, from 12:00 pm to 7:00 pm at 63 locations and restaurants throughout Hong Kong. A ceremony will be held at the main signature center at Shatin City Hall Plaza at 3:00 pm. All signatures received will then be given to Hong Kong’s Asian Games Bid Committee to be included in Hong Kong’s submission. Timothy Fok, President of the Sports Federation and Olympic Committee of Hong Kong, China said, “the Signature Campaign is an excellent way for Hong Kong People to express their support for Hong Kong’s bid. The endorsement reinforces Hong Kong’s will and determination in hosting the Games.” An Asian Games Bidding Parade will be held on August 20, 2000 at 9:30 am. Guests of Honor includes: W.K. Lam, Secretary for Home Affairs for Hong Kong, Timothy Fok, President of the Sports Federation and Olympic Committee of Hong Kong, China; The Hon. Nellie Fong, Executive Councillor for Hong Kong and Executive Committee Chairman of The Better Hong Kong Foundation and Yiu-tong Cheng, Chairman of The Hong Kong Federation of Trade Unions. The parade route will begin at Centenary Garden, Tsimshatsui East and end at Kowloon Park. Approximately 5000 people from all walks of life are expected to join the parade. The Hong Kong-Southern China Canoe Adventure, organized by The Hong Kong Award For Young People, will take place from August 20 to 23, 2000. 60 youth from 16 to 25 years old will join this historic event. They will travel from Hong Kong to Southern China in 4 days and 3 nights by canoe for a 100 km cross-border journey. This adventure will provide the opportunity for our youth to gain a better understanding of China and to have a challenging self enriching experience. Yiu-tong Cheng, Chairman of The Hong Kong Federation of Trade Unions, said that, “Through a series of activities, we will raise the public awareness of the importance of hosting the Asian Games in Hong Kong. The Asian Games is important for Hong Kong as it will enhance our continuing prosperity and provide many new jobs for those who most need it.”   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Science and Technology Competition Grooms Hi-tech Professionals

2000.06.17
The Hong Kong High-tech Development Investment Scheme inter-school competition organized by the Better Hong Kong Foundation’s Hong Kong Together Campaign held an award-presentation ceremony today. The top three winners were, Lai Chack Middle School, Po Leung Kuk No.1 W.H.Cheung College and St. Paul’s Secondary School. Along with nine other outstanding teams, they were awarded scholarships to attend a high-tech course in Beijing’s Tsinghua University and Shenzhen’s Tsinghua Research Institute. George Yuen, the Foundation’s Chief Executive explained that, “the aim of this competition is to realize the government’s vision of developing Hong Kong into an information and technology center. This program reasserts the importance of nurturing a new generation of professionals in science and technology in order to face the challenge in the new century which stresses the use of knowledge.” Yuen added, “the competition’s main objective was to generate students’ interest in high technology. Through the process of data collection, analysis, establishing arguments, compiling and presenting their proposals, students would have a better understanding of the research topics. The use of computer in the project also helps polish their skills in the applying new technology.” The winning entries will be published in the Better Hong Kong Foundation’s web site. The Hong Kong High-tech Development Investment Scheme competition was possible through the support of the Hong Kong Government’s Quality Education Fund. Peter Lee, Education Committee Chairman of the Foundation’s Hong Kong Together Campaign says, “not only does the competition foster students’ understanding in science and technology, it also strengthens their commitment to contribute to a more cohesive community.” In July, the 12 winning teams will attend a two-week course at Beijing’s Tsinghua University and Shenzhen’s Tsinghua Research Institute, where they will have a familiarization course on the developments in information, electronics, biochemical and environmental technology. They will also visit various research institutions and organizations to have first-hand experience of the latest technology and economic development in China. K.H. Tong, Acting Director of the Education said, “the meaning of this competition lies in the importance of knowledge-based education. We should arouse students’ interest in the knowledge outside textbooks, especially those concerning high technology and its application. Competitions like this are part of the investment in human capital. I hope there will be more such competitions in the near future so as to help train a new generation of professionals in Hong Kong.” Mr. Yuen added, “this competition has received a good response from the students and have put together excellent presentations.” Following the success pf this competition, the Better Hong Kong Foundation will hold a second Hong Kong High-Tech Development Investment Scheme” competition in September and October this year. We hope that more students will be interested to take part.” The Foundation’s Hong Kong Together Campaign was started in 1998 to encourage public togetherness as well as engender much valued civic spirit in the community. The Better Hong Kong Foundation with a number of participating sectors in the community formed a Joint Working Committee to steer the Campaign.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Governor Paul Cellucci, Massachusetts, USA, Visits Hong Kong Exploring Investment Opportunities

2000.03.25
The Better Hong Kong Foundation, with a mission to bring prosperity to Hong Kong, regularly invites trade representatives from around the world to keep them abreast of the latest developments in Hong Kong. The United States is one of Hong Kong’s most important trading partners. The Foundation is honored to have Governor Paul Cellucci of the State of Massachusetts visit Hong Kong in these few days along with Senator Stephen Lynch and Representative William McManus. He will also lead a high-powered 29-member business delegation, with many influential businessmen in areas such as technology, finance, ports and construction, to understand the current financial, commercial, social and political developments here, and to explore possible business opportunities. Mr. Cellucci has served as Governor of Massachusetts since July 1997. The 1973 Boston College Law School graduate has served in the U.S. Army Reserves, practiced law for 17 years and has worked with his family’s auto dealership for almost 30 years. He was elected to the Massachusetts Senate in 1984, and during this third term became Assistant Republican Leader. Mr. Cellucci is a strong advocate for smaller government and lower taxes. He has signed the largest tax cut in Massachusetts’ history and has also been a leader in education reform, access to health care and the fight against domestic violence.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

The Better Hong Kong Foundation Hong Kong Budget Forum Experts Praise This Year’s Gentle Budget by Financial Secretary

2000.03.08
Academic, business, tax and labor experts welcomed the Budget by Financial Secretary Donald Tsang who described it as, “a gentle hand on the tiller.” It proposed the least revenue measures of recent budgets and was hailed as one that gives due regard to the government’s economic philosophy of prudent fiscal policy, balanced income and expenditure, simple tax system and has considered the public’s interests in the economic recovery. The Budget was praised as forward looking in preparing the economy for a new era. The Better Hong Kong Foundation held a Hong Kong Budget Forum immediately following the Budget Speech. Five experts from various sectors were invited to comment on the government’s financial blueprint for the year 2000/2001. The experts included: Professor Richard Wong, Director, School of Business, The University of Hong Kong; Professor Fan Yiu Kwan, Dean, School of Business of the Hong Kong Baptist University; Mr. Marcellus Wong, Partner, Tax Services, Arthur Andersen; Mr. Francis Lau, Executive Secretary, Chinese Manufacturers’ Association of Hong Kong; and, Mr. Wong Kwok Hing, Deputy Director, Social Affairs Committee, Hong Kong Federation of Trade Unions. Professor Wong said, “the long term development of the Hong Kong economy relied on grasping the economic opportunities and in dealing with long-term issues such as, globalization of the economy, economic transformation, development of information technology and impact of the business environment.” Professor Wong also agreed with Mr. Tsang’s suggestions of strengthening labor training and education. As to the plan of reforming the financial system and the introduction of a US dollar clearinghouse, Professor Wong considered it a creative idea which would help strengthen the position of Hong Kong as an international financial center. Professor Wong explained that, “a US dollar clearinghouse would help save time for currency exchange, especially H-share companies which intend to list in the US and already use HK dollars to raise capital locally. It would also protect investors if for any reason the HK/US dollar peg became unstable.” He also praised Mr. Tsang’s commitment of reviewing the entire tax system, but warned of the possible danger that if the review results favored the taxing of internet activities or to tax income out of Hong Kong it would seriously affect the economic and investment initiatives. He stressed, “a narrow tax base was no problem, the question was whether there were adequate measures to recover tax and deal with the instability in an economic cycle.” Professor Fan also welcomed the establishment of a US dollar clearinghouse. He explained that, “such mechanisms in the Asian region only currently existed in Japan. The introduction of this in Hong Kong would strengthen the territory’s position as a major financial center in Asia.” As to the tax review plan, he thought the government should not only consider adding new taxes as “the introduction of a sales tax was a large move which would have implications on economic resources, high opportunity costs and little gain for the economy.” Rather, he felt that, “the government should look for ways to improve existing tax, such as rates which already have a wide base. As it is already in existence it does not require further examination by the Legislative Council.” Mr. Marcellus Wong, also Past Chairman of the Taxation Association said that, “this was not the first time Mr. Tsang used the approach of ‘suggesting little'”. He pointed out the budget failed to provide plans to respond to the economic opportunities created by the globalization of the economy and to help small and medium enterprises face the transformation as a result. He suggested the government should learn from countries such as Singapore and India, and provide SMEs with tax relief to develop e-commerce to help them adapt to the changing economy. In the area of a tax review, he disagreed with the government’s plan to have an internal body to review the tax system while also setting up an independent committee to examine new tax methods. He thought the work should not be split into two and should be done by the independent body alone. Mr. Lau welcomed the government’s establishment of the new Innovation and Technology Commission and the renaming of the Trade Department to Industry and Trade Department. He explained that, “Hong Kong manufacturers have always confused the Industry Department and the Trade Department. The merging of the two departments would definitely help solve manufacturers’ problems more effectively.” Mr. Wong Kwok Hing, who represents workers’ benefits, also welcomed the government’s move of reviewing the tax system. He said, “apart from examining ways to widen the tax base, the government should consider the ‘vertical fairness principle,’ for example, the more a company earns, the more it should contribute.” He disagreed with Mr. Tsang’s view that this would force large companies to split into smaller ones to avoid tax, and said, “the government should be able to introduce measures against it. “ He also pointed out the Budget lacked suggestions to help people who were relying on social security to find work and to assist SMEs in facing the changing economy. He hoped the government could set up an employment board to coordinate employment issues. George Yuen, Chief Executive of the Better Hong Kong Foundation, said Mr. Tsang had presented a very good budget. “Although Mr. Tsang has put forward the least amount of tax changes, he has made many concrete, brave and forward-looking proposals to benefit the long term. He has also endeavored to reform education, and provide vocational training for youngsters and retraining for low income people to meet the demands of the changing economy.” The suggestions made in the Forum will be given to the SAR government for consideration.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong’s role as the leading regional, financial, shipping, trading, communication and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Better Hong Kong Foundation Hails Business and Technology Mission to U.S. and Canada: Rewarded With Expanded Networks for Future Cooperation

2000.02.15
A Better Hong Kong Foundation delegation has just returned from a visit to Canada and the United States where they met with government officials, congressmen, policy advisors and business leaders to discuss Hong Kong issues. The topics discussed focused on technology, financial trends and the economic outlook of Hong Kong in the face of China’s imminent accession to the World Trade Organization. The Better Hong Kong Foundation organizes two to three delegations of this nature to North America each year to promote Hong Kong as an international business center. The mission led by The Honourable Nellie Fong, Executive Councillor of the HKSAR and Chairman of the Foundation’s Executive Committee visited Toronto, Canada and Washington, D.C., Northern Virginia’s Dulles Corridor, Silicon Valley and San Francisco in the U.S. from January 27 to February 5, 2000. The delegation with an agenda to examine advanced technology included prominent Hong Kong industrialists, technology CEOs and leading members of the financial and legal community. The delegation members included Mr. Anthony Au, Dr. Cheng Wen Cheng, Mr. Raymond Chu, Mr. Daniel Fung, Dr. Frederick Hu, Mr. Laurence Li, Mr. Liu Mingkang, Mr. Peter Lo, Mr. W.H. Ng, Mr. Andrew Sheng, Mr. Lawrence Tan, Mr. Thomas Tang, Mr. Ben Wong, Mr. George Yuen and Mr. Alvin Lee. (A full list of delegation members with their titles and affiliations) In the U.S., the delegation met with members of Congress, leading think tanks such as the CATO Institute and the American Enterprise Institute, government officials in the Clinton administration, the Chairman and CEO of NASD, influential technology councils and business associations.  In Washington, D.C., the delegation held meetings with high technology firms such as AOL, EDS, ManTech International Corp, Motley Fool and Network Solutions; established alliances with The Northern Virginia Technology Council, The Information Technology Industry Council, The Greater Washington Initiative and The Coalition of Employment through Exports; and, venture capital firms such as Venturehouse and FBR Venture Capital Partners. High tech and venture capitalist firms on the delegation’s Silicon Valley and San Francisco itinerary included Cisco Systems, Intel, Oracle, Solectron, Goldman Sachs, H & Q Asia Pacific, National Semiconductors and Materials Association, National California Venture Capital Association and Semiconductor Equipment and Materials International, Pentagon Inc, China Vest, W.I. Harper and World Affairs Council. The delegation attended dinners hosted by Ambassador Mickey Kantor, former U.S. Secretary of Commerce and Ms. Jackie Willis, Hong Kong’s U.S. Commissioner in Washington, D.C. In San Francisco, Forbes publisher, the Vice Mayor of San Jose, Stanford University, HongKong-SV.com and Hong Kong Economic & Trade Office organized receptions and dinners in honor of the Foundation and delegation through events that offered excellent occasions for exchange and networking. Earlier in Toronto, some members of the delegation held useful discussions with government leaders, Ontario Exports, Hong Kong Canada Business Association, Canadian Bankers Association and international corporations such as Nortel Networks, Descartes, Sybase Canada, HSBC Canada and Citibank. They also visited The University of Toronto where they met with Neteka, a hi-tech offshoot and the Centre for International Studies. A meeting was also held with the Law Deans from the University of Toronto and Osgoode Law School of York University. Mrs. Nellie Fong was pleased to report views from the congressmen and opinion leaders in the U.S. that they were confident in Hong Kong, especially the initiatives introduced by Chief Executive, Mr. C.H. Tung on innovation and technology and Hong Kong people’s ability to adapt to this change. The U.S. interlocutors were satisfied with the practice of the one country, two systems principle and its rule of law in Hong Kong. They were much encouraged to note Hong Kong was back on the road to recovery together with its continued ranking of the freest economy in the world for six consecutive years by the Heritage Foundation and with further endorsement by CATO Institute of the U.S. and Fraser Institute of Canada. They recognized Hong Kong’s position and the likely impact on its economy after China’s accession to the WTO and briefed the delegation on the congressional assessment of various scenarios in relation to granting Permanent Normal Trading Relations status to China. Further commenting on the visit, Mrs. Fong said, “In the past year, Hong Kong has been instrumental in furthering the Internet revolution in Asia as well as contributing to the tremendous growth in China’s markets. We cannot afford to be complacent if Hong Kong wants to rank itself in the innovation and technology league. This was a learning mission for us to realize the breadth and depth of the advanced technology and its impact on American business. This trip reaffirmed the importance of education to the quality of professionals needed to meet the growing demand in the technology sector and the necessity of a human resource strategy to address the quality of life and the living environment issues crucial to attracting the right talent and their families to Hong Kong.” “The delegation also recognized an urgent need of having specialized venture capital funds and financial analysts in the technology and innovation field in Hong Kong as such expertise is necessary for innovative business and startups to germinate. There is a shortage of this kind of financial professional. It is therefore essential to formulate plans for attracting such specialists to come to Hong Kong. We should also be proactive in marketing incubator projects in Silicon Valley in order to attract investment to Hong Kong. Development offices from Korea, Scotland and Taiwan have been established in Silicon Valley to woo such business partners.” Mrs. Fong further stressed. “The Foundation organizes missions in line with the vision of Chief Executive Tung’s 1998 Policy Address to promote Hong Kong as a center of high technology and to capitalize on its strategic proximity to what is perhaps the biggest economy in the 21st century. This visit to the U.S and Canada is an excellent opportunity to bring the excitement of Hong Kong to our friends on the other side of the globe and to update them on key developments taking place in Hong Kong. More importantly, this is a networking mission allowing the Foundation to continue exchanges and further cooperation between Hong Kong, Canada and the U.S. We will continue these visits in the future. We hope that large companies and SMEs would benefit from these increased activities and both government agencies and NGOs would respond with equal enthusiasm and vigor” remarked Mr. George Yuen, the Foundation’s Chief Executive. “The Better Hong Kong Foundation is delighted to once again promote exchanges between business and political leaders from Hong Kong and North America,” added Mr. Yuen, “We believe that these regular exchanges will be crucial for maintaining Hong Kong’s position as an international business center and will set a benchmark for us to assess our opportunities and challenges as Hong Kong emerges as another technology hub in Asia.” For inquiries, please contact: Alvin Lee General Manager (Communications) The Better Hong Kong Foundation Tel: 852-2861-2622 Fax: 852-2861-3361 Email: Alvin_Lee@betterhongkong.org   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong role as the leading regional financial, shipping, trading, communications and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Better Hong Kong Foundation Continues to Promote Hong Kong as an International Finance Center Organizes High-Level Delegation to United States and Canada to Discuss High Technology

2000.01.27
The Better Hong Kong Foundation has organized a high-level delegation which begins a visit today in North America to update business leaders, government officials, policy advisors and media on Hong Kong issues. The topics discussed will focus on technology, financial trends and the economic outlook of Hong Kong in the face of China’s imminent accession to the WTO. The Better Hong Kong Foundation organizes two to three delegations of this nature to North America each year to promote Hong Kong as an international business center. This visit comes at the heels of Hong Kong’s selection once again as the world’s freest economy by the Heritage Foundation’s 2000 Index of Economic Freedom and by a joint study conducted by the Cato Institute and Fraser Institute’s Economic Freedom of the World: 2000 Annual Report. The delegation will travel to Toronto, Canada from January 27-30, and later to the Washington, D.C. area, including Northern Virginia, and the San Francisco Bay Area, including Silicon Valley, from January 27 to February 5. In the United States, the delegation is scheduled to meet with leaders in business, politics, academia and research, and high technology. In Washington, the delegation will meet with members of Congress, leading think tanks such as the Heritage Foundation and the American Enterprise Institute, government officials in the Clinton administration, the Chairman and CEO of NASD and numerous others. The delegation will also travel to the Dulles Corridor, Northern Virginia’s vibrant high technology center, to attend meetings with high technology firms such as Motley Fool and a dinner hosted by America Online with former Secretary of Commerce Mickey Kantor. High tech companies and venture capitalists on the delegation’s itinerary in Silicon Valley include Oracle, InfoGear Corporation, TechNet, Solectron Corporation, Hambrecht & Quist Asia Pacific, National Association of Venture Capitalists, and International Business Forum. In Canada, the delegation is scheduled to meet with government leaders, academic scholars at the University of Toronto, leading technology companies such as Nortel Networks, representatives from the banking sector such as HSBC Bank Canada, other business representatives and the local Chinese community. Led by the Honorable Nellie Fong, Chairman of the Executive Committee of the Better Hong Kong Foundation and Executive Councillor of the HKSAR, the delegation includes representatives from Hong Kong’s legal, political and business communities. Commenting on the visit, Mrs. Fong said, “In the past year, Hong Kong has been instrumental in furthering the Internet revolution in Asia, as well as contributing to the tremendous growth in China’s markets. This trip is in line with the vision laid out by Chief Executive Tung Chee-Hwa in his 1998 Policy Address, that is, to promote Hong Kong as a center of high technology and to capitalize on our strategic proximity to what is perhaps the biggest economy in the 21st century. The visit to the United States and Canada is an excellent opportunity to bring the excitement of Hong Kong to our friends on the other side of the globe and to further update them on other key developments taking place in Hong Kong.” “The Better Hong Kong Foundation is delighted to be once again promoting exchanges between business and political leaders from Hong Kong and North America,” said Mr. George Yuen, Chief Executive of the Better Hong Kong Foundation. “We believe that these regular exchanges will be crucial for maintaining Hong Kong’s position as the financial center of Asia.” Others traveling with Mrs. Fong and Mr. Yuen to North America are: Mr. Anthony Au, Dr. Cheng Cheng Wen, Mr. Raymond Chu, Mr. Daniel Fung, Dr. Frederick Zuliu Hu, Mr. Laurence Li, Mr. Peter Lo, Mr. W.H. Ng, Mr. Andy Pao, Mr. Andrew Sheng, Mr. Lawrence Tan, Mr. Thomas Tang, Mr. Ben Wong, and Mr. Alvin Lee.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong role as the leading regional financial, shipping, trading, communications and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

Millennium Heritage Bowl Banquet on New Year’s Day: A Community Hong Kong Together Event

2000.01.01
Community-spirited members of the public greeted the new Millennium by contributing towards a special cause by supporting the Millennium Heritage Bowl Banquet on New Year’s Day. The Millennium Heritage Bowl Banquet was organized by the Joint Working Committee of Hong Kong Together and the Home Affairs Department. This event was part of a series of community-wide programs held by Hong Kong Together over the past year. Further activities will be held in the new Millennium calling on community groups and interested individuals to work towards a better future for Hong Kong. Over 700 people attended the Millennium Heritage Bowl Banquet. The guests included Mrs. Shelly Lau, Director of Home Affairs; Mrs. Nellie Fong, Chairman of the Executive Committee of the Better Hong Kong Foundation and Executive Concillor of the HKSAR and winners of the Miss Hong Kong Pageant as well as leading artists from TVB. Mr. Yeung Koon Yat, founder of Ah Yat Abalone, member of Le Club des Chefs des Chefs, Honorary Chinese Cuisine Euro Toques President of Asia, Knight of the order of the Agriculture Merite, Chevalier De L’ordre Du Merite Agricole, was invited to be a consultant to the function and demonstrated his special skills in preparing abalone during the Banquet. George Yuen, Convenor of Hong Kong Together, said, “the enthusiastic response from the public in supporting the Millennium Heritage Bowl Banquet highlighted Hong Kong People’s commitment in supporting worthy causes. Funds raised from this event will go towards Lifeline Express, a hospital train that travels to faraway and remote regions of China providing free cataract surgery for poor people”. Mr. Yuen also stressed that people of Hong Kong are traditionally assertive in facing challenges and thrive under hardship conditions. He was convinced that with the resilience and qualities of Hong Kong people, they would usher in a brighter and more prosperous new Millennium. Participants of the Banquet enjoyed performances and games organized especially for the event. Each guest was awarded with a Thank-You Certificate in appreciation for their contribution to Lifeline Express. The Banquet was held on New Year’s Day at the Miramar Hotel, Tsimshatsui, Kowloon, Hong Kong.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people to reinforce Hong Kong role as the leading regional financial, shipping, trading, communications and technology center. The Foundation also serves to enhance greater international understanding between East and West by facilitating communications between Hong Kong, China and the international community.

‘Hong Kong Together’ Greets Millennium with Exciting Programs Hong Kong Residents to Challenge World Records Together

1999.12.17
The Joint Working Committee of Hong Kong Together, initiated by the Better Hong Kong Foundation to bring together Hong Kong people, announced today that it will organize a series of large-scale programs with the Home Affairs Department between now and Year 2000. On New Year’s Eve and Day, Hong Kong Together, with the Tsuen Wan District Office and TVB, will organize a variety of activities to greet the new millennium. These activities include a Millennium “Heritage Bowl” Banquet, “Greeting the Millennium with a Thousand Hearts” Environmental Protection Campaign, and a number of games where people will attempt to break world records. These games feature a three-legged race for two thousand people, the release of ten thousand sodas in the air, the lighting of two thousand light bulbs, a dragon dance by a paper dragon made up of one thousand sectors, and an attempt to break the Hong Kong record of fitting twenty five people into a Volkswagen beetle and a two-thousand pound cake. George Yuen, Convener of Hong Kong Together, pointed out at today’s press conference that to have Hong Kong people attempt to beat existing world records is most exciting. “People of Hong Kong have been traditionally assertive and creative in facing challenges. We hope that through these activities, we can highlight the strength of our people and reinforce their abilities in confronting barriers. To thrive under hardship reflects precisely the courage of Hong Kong.” Hong Kong Together has led many community-wide initiatives over the past year. The activities in the new millennium will call on community groups and interested individuals to work toward a better future for Hong Kong. To start, Hong Kong Together is sponsoring a series of educational programs from today until December 19. The Chinese University of Hong Kong, University of Hong Kong and Hong Kong Educational Council, with support from Hong Kong Together, will hold the “1999 International Literary Education Seminar” to discuss the teaching of literary and educational knowledge. In addition, Hong Kong Together will seek to raise high school students’ awareness and interest in high technology in order to prepare them for the future. Hong Kong Together will invite all Hong Kong high school students to participate in a High Technology Essay competition, where the winners will have the opportunity to visit Tsinghua University and the Tsinghua Center in Shenzhen to observe China’s latest high technology developments. “The mission of Hong Kong Together is to bring Hong Kong people together to work towards a better future,” said Mr. Yuen. “With the strong support received last year, we plan to continue working with the 18 Districts and sectors, such as the food, hotel and retail industries, educators in Hong Kong and in Mainland China, the entertainment industry, labor and community groups to organize many more large-scale activities. We hope that together, the people of Hong Kong will usher in a brighter and more prosperous new millennium.” End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people. The Foundation aims to reinforce Hong Kong’s role as the regional leading financial, shipping, trading and communications centre. It also serves to enhance greater international understanding between East and West. The Foundation is committed to facilitating communication between Hong Kong and China and the international community.

Hong Kong Needs to Find its Competitive Edge in its People and Cost of Doing Business

1999.12.02
The further opening up of mainland China after its accession to the World Trade Organisation means that Hong Kong will have to become even more competitive in the long-term, says Hong Kong Financial Secretary, The Hon Sir Donald Tsang. In his keynote address to The Economist Conferences’ Hong Kong Regional Business Group meeting yesterday, Sir Donald reported that while economic figures are encouraging, Hong Kong is still vulnerable to many external factors and will have to work hard to maintain its position as a regional technological and financial hub. Hong Kong needs to look to the quality of its business people and the cost of doing business in order to survive. Developed in association with The Better Hong Kong Foundation, yesterday’s forum brought together more than 200 senior regional executives based in Hong Kong to address a range of key issues from the financial, human resources, China relations, technology and tourism areas. Speakers at yesterday’s event included Mr David Li, Chairman and CEO of the Bank of East Asia; Mr Tony Latter, Deputy Chief Executive of the Hong Kong Monetary Authority; Mr Liu Ming-Kang, Chairman of China Everbright; The Hon CY Leung, Convenor of EXCO; and Mr Mike Rowse, Commissioner for Tourism, Hong Kong Tourist Association. “As Hong Kong recovers from its worst-ever recession, the competition from Singapore and Shanghai as business operating centres is increasing,” says the forum chairman, Mr David O’Rear, Regional Economist for The Economist Conferences. When discussing Hong Kong as a regional hub, it is impossible to ignore the impact of China’s growth. With the huge strides made in the Mainland in recent years, we must recognise that Hong Kong’s very survival as a regional centre depends on driving down the cost of doing business in Hong Kong.” Human resources in Hong Kong was a key issue addressed at the Forum. Finding the right people to drive Hong Kong’s business growth – and retaining them – is critical,” continues Mr O’Rear. “Service-oriented economies, such as Hong Kong’s has now room for under-achieving students and has no low-skill job sector to absorb their labour. Thus, the ultimate health of the economy depends on us providing a high quality education that our business requires.” The growth of the internet and interactive technology based businesses and their impact other key business sector was also an important topic during the forum. “Because venture capitalists look to the high risk, high reward opportunities, they are now focused on the internet and dot coms,” says David O’Rear. This is, to a degree, taking potential investors away from other industries in Hong Kong. As a response, the Hong Kong Government is moving into a very unusual role – that of a business investor. It remains to be seen if our bureaucrats are better venture capitalists than the professionals.” Sponsors for yesterday’s forum were representative of the key issues discussed. “We were delighted to work with Arthur Andersen, China.com Corporation, HIH Insurance, Korn/Ferry International who share our interest in developing Hong Kong’s position in the region,” concludes Mr O’Rear. About the Hong Kong Regional Business Group (HKRBG): The HKRBG is an exclusive programme for regional directors based in Hong Kong. Part of an international network, it aims to provide thought provoking analysis and commentary on issues that affect strategic business planning and the bottom line of companies operating in Asia.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people. The Foundation aims to reinforce Hong Kong’s role as the regional leading financial, shipping, trading and communications centre. It also serves to enhance greater international understanding between East and West. The Foundation is committed to facilitating communication between Hong Kong and China and the international community.

Better Hong Kong Foundation Calls Freest Economy Ranking A Global Endorsement of the SAR Business Environment

1999.11.30
Today the Heritage Foundation and the Wall Street Journal reaffirmed Hong Kong’s status as the world’s freest economy in their 2000 Index of Economic Freedom. George Yuen, Chief Executive of the Better Hong Kong Foundation, said, “this latest ranking is a global endorsement of Hong Kong’s business environment. Hong Kong has always and continues to maintain its basic freedoms, especially speech and free-flow of information.” The Foundation said that it was particularly pleased that Hong Kong improved its score in the monetary policy category of the 2000 Index. In commenting on Hong Kong’s policies toward capital flows and foreign investment, the Foundation noted that the Heritage Foundation and the Wall Street Journal “recognized that Hong Kong’s government is one of the most receptive to investment in the world.” The Foundation said that the comments made by the two co-publishers of the economic freedom index regarding Hong Kong’s trade policy were something in which all members of the Hong Kong business community could take particular pride. “In acknowledging that Hong Kong has one of the world’s most accessible markets, the Heritage Foundation and the Wall Street Journal were also endorsing the level playing field for companies from around the world that has been created by both the public and private sectors in Hong Kong,” said Mr. Yuen. The Foundation believes that this latest ranking will be extremely important in Hong Kong’s ongoing efforts to attract foreign direct investment and to generate new trade opportunities for Hong Kong companies. According to the Foundation, “this ranking sends an important signal to the international business community that Hong Kong still represents one of the best places in the world to do business.”   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people. The Foundation aims to reinforce Hong Kong’s role as the regional leading financial, shipping, trading and communications centre. It also serves to enhance greater international understanding between East and West. The Foundation is committed to facilitating communication between Hong Kong and China and the international community.

Better Hong Kong Foundation Applauds China-US WTO Deal

1999.11.15
The Better Hong Kong Foundation applauds the news that the People’s Republic of China and the United States have reached agreement today on their bilateral talks regarding China’s accession to the WTO after 13 years of negotiations. We firmly believe that Hong Kong will be a major beneficiary of China’s admission to the WTO in three key areas: 1. As a key facilitator of trade between Mainland China and the world, Hong Kong will benefit from the expanded trade opportunities that the WTO agreement is expected to bring to China. This benefit will come in the form of increased need for Hong Kong-based support in such areas as legal, accounting and management services. Hong Kong’s world-class shipping and transport infrastructure will also benefit from the expansion in import and export shipments that will be linked to China’s membership in the WTO. 2. Hong Kong’s strong financial and banking service sector will benefit from the increased trade and investment activity that is certain to be created by China’s WTO membership. This sector is already a key source of trade and finance capital for China’s growing industrial sector. 3. We believe that this agreement will have a dramatic impact on international investor confidence in Mainland China and this can only have a significant spillover effect on Hong Kong and much of the rest of Asia. It will also end the uncertainty that was associated with the annual debate regarding China and the Most Favored Nation status granted by the U.S. Commenting on today’s announcement, George Yuen, Chief Executive of the Better Hong Kong Foundation said, “We are particularly pleased that this agreement is being positioned as a “win-win” for both China and the United States. Only in this way can these two important countries move forward to work together to build their own economies and those of the rest of the Asia-Pacific region. As such, this agreement is good for Hong Kong and the rest of the region.” Mr. Yuen said that his organization would continue to support the final stages of negotiations that China must carry out with the European Union before it will have completed all of the hurdles between it and WTO accession. “We will ensure that our network of government and business contacts in Europe are aware of the importance of this agreement to the business communities in Hong Kong and on the Mainland and that they will work with their governments to support timely approval,” he said.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people. The Foundation aims to reinforce Hong Kong’s role as the regional leading financial, shipping, trading and communications centre. It also serves to enhance greater international understanding between East and West. The Foundation is committed to facilitating communication between Hong Kong and China and the international community.

Hong Kong Companies Commended by Forbes for Best Practices

1999.11.11
The Hong Kong Productivity Council (HKPC) and the Hong Kong General Chamber of Commerce (HKGCC) in association with The Better Hong Kong Foundation (BHKF) jointly organized a commendation ceremony to honour eight local companies which have earned a coveted place on Forbes Global’s 1999 list of The World’s 300 Best Small Companies. The ceremony was officiated by Mr William Adamopoulos, Managing Director – Asia of Forbes; Mr Andrew Tanzer, Pacific Bureau Chief of Forbes; Mr Thomas Tang, Executive Director, HKPC; Mr Ronnie Chan, Trustee, BHKF; and Mr Christopher Cheng, Deputy Chairman, HKGCC. The selected companies include Caf?de Coral Holdings Ltd., Giordano International Limited, Glorious Sun Holdings Ltd., Guangdong Kelon Electrical Holdings Company Limited, Hung Hing Printing Group, JCG Holdings Ltd., Johnson Electric Industrial Manufactory, Ltd., and Varitronix International Limited. Guangdong Kelon and Johnson Electric have been elevated to Forbes’ 20 for 2000, the ultimate ‘star performers’ among the 300. Speaking at the commendation ceremony, Mr Thomas Tang said, “These companies come from a wide spectrum of Hong Kong’s manufacturing and service sectors, including restaurants, apparel, printing, electrical equipment, financial services and electronic components.” “The recognition by Forbes Global is indicative of the world-class performance of Hong Kong companies. As role models for Hong Kong, we believe that these companies will continue to serve as our benchmarks, setting new standards of excellence as Hong Kong thrives forward into the digital economy of the new millennium,” Mr Tang said. Citing a letter from Mr Lawrence Minard, Editor, Forbes Global Businesses and Finance, Mr Andrew Tanzer said, “Forbes Global editors screened over 17,500 publicly-traded companies, and supplemented their computer screens by interviewing bankers, analysts and institutional investors around the world. The odds of making our list are roughly equal to the chances an American actor has of winning a Hollywood Oscar.” Mr Ronnie Chan said, “In Hong Kong, there are 290,000 SMEs representing 98% of our businesses. They play an important and pivotal role in making Hong Kong what it is now. It is through the joint effort of our businesses, employees and investors that Hong Kong now enjoys its international stature. The Asian economic crisis has put Hong Kong on an acid test in terms of our resilience, productivity, competitiveness and vision. Hong Kong is now back on the right track.” Mr Christopher Cheng said, “The selection of these companies by Forbes Global, a genuinely world class institution, sheds lights on two aspects. Firstly, all of the companies being commended are transnational and the attitude of reaching out is very important in ensuring Hong Kong’s continuing development as a world city. Secondly, these companies are all small and medium sized and they signify that the 300,000 companies in Hong Kong have the potential to become world class companies.” In addition to the commendation ceremony, HKPC also organized the Power Forum on Best Practices followed by the Powerhouse Hall of Fame unveiling ceremony. The Forum was presented by CEOs of the eight companies who shared with local companies their best practices while the Hall of Fame was established by the Powerhouse of HKPC to honour outstanding achievements of local companies. The unveiling ceremony was officiated by Mr Thomas Tang; Dr Eden Woon, Director, HKGCC; and Mr George Yuen, Chief Executive, BHKF. The Powerhouse of HKPC’s Best Management Practices Institute was established in April this year in response to the initiative of the Chief Executive of the HKSAR Government to develop Hong Kong into a regional service centre. The aim is to provide support to individuals, organizations, industries, and the community at large in a continuous learning process and benchmarking that enable them to achieve business excellence through best management practices.   End The Better Hong Kong Foundation is a privately funded, non-profit, non-political organization, formed by leading Hong Kong business people. The Foundation aims to reinforce Hong Kong’s role as the regional leading financial, shipping, trading and communications centre. It also serves to enhance greater international understanding between East and West. The Foundation is committed to facilitating communication between Hong Kong and China and the international community.