Speech on Pursuing Economic Redevelopment of Hong Kong

Hong Kong has undergone several rounds of turmoil since reunification. They help us realize that many issues are still outstanding, particularly the economy. The traditional four pillars of major industries are insufficient to sustain economic growth and Hong Kong must chart new courses. Accordingly, the SAR Government has drawn up many blueprints. The first Administration proposed the development of Science Park, Chinese medicine port, cyber port, creative industry, education industry and medical industry, etc. The previous Administration has also promoted six industries where Hong Kong enjoys clear advantages (the Key-Six), after deduction from experience. Unfortunately, new industries are yet to emerge and these plans are still a far cry from realization.


Today’s Motion calls for Government leadership to chart new courses and redevelop the economy. Fellow Honorary Members have come up with many proposals and concepts, and I largely agree to them. As I said earlier, Hong Kong has been looking for redevelopment opportunities but is still in vain. In my view, we should first pause and think what might have prevented us from realizing these plans. We should learn from experience to avoid repeating mistakes. We should all realize that the success of an industry needs substantial time and resources as well as focused planning and breeding. The absence of clear goals means lack of focus. It would also mean waste of time and resources. Therefore, new course could hardly be charted without first knowing the path ahead.

Actually, the Government has put forward many ideas and most are being pursued. However, a jack of all trade is an expert of none. Undiagnosed treatments often end up with the wrong dose. Facing with economic downturn, the First Administration was eager to find new horizons. It was no surprise that piloting at all fronts borne no fruit. After changeover, the new Administration is resetting priorities in economic redevelopment. For instance, pursuit of the six key industries would continue but there is reservation in education and medicine as industries. The Key-Six might be reduced to just Key-Four.

Apparently, an unspecific course of economic redevelopment could not bring the community together and focus. Thus, input/output benefits are greatly discounted. The Government has now established an Economic Development Committee to review policy and strategy of industrial redevelopment. I wish that EDC would fully study and debate after public consultation, and find the best course of redevelopment that would meet the needs of both Hong Kong and Mainland. If EDC concludes that the Key-Six should be reduced to Key-Four, the Government should act with no hesitation. High level leadership by CS or FS is essential in leading departments concerned to follow the new path. I believe that this is our only way of success.

Apart from unambiguous goals, the new Administration should be determined to desert the classic doctrine of “big market and small government” and the psychology of “better be inert than to err”. Actually, public aspiration was high when the Key-Six was proposed. However, the Administration then stood by the classic doctrine when it came to realization of the plan. It only assumed the role of “bystander”, providing economic incentives with a view to promoting private sector participation through market force. Thus, the outcome fell short of public expectation.

Experiences around the world have shown that government involvement or even leadership is essential in redevelopment. Apart from tax concessions and policy incentives, extensive support is often offered. The development of high technology industries in South Korea and headquarters economy in Singapore are fully backed and steered by the Government. Even Western Governments are sending business delegations to visit China frequently and conclude deals. Nowadays, if the Government still insists on standing at the sideline, it would remain a spectator not player. Thus, I fully agree to the Original Motion that the Government should suitably utilize financial resources and policy incentives to steer redevelopment of the economy.

Finally, I would like to point out that economic redevelopment simply means finding new industries to supplement or complement the Key-Four, not replacing any of them. May I stress this point to remind us that the Key-Four are also facing considerable competition, especially financial services? Our comparative advantages are diminishing as major rivals like Singapore are becoming more competitive. If we still take them lightly, we might be losing ground as international financial centre. If such day did ever come, it would be perhaps too late to reverse trend.

Unfortunately, not everybody is thinking alike. It is worrying that many people do not believe or even consider that the Hong Kong economy is delicate. There are far too many internal rows that would distract the community from economic redevelopment. Let me use the Taiwan as an illustration. It started to develop high technology industries as early as the 1980s with remarkable results. Its economy used to have leading edges over South Korea. Since 1990s, however, Taiwan has been entrapped in domestic politics and the economy suffers. Meanwhile, South Korea is diligent in high technology research and development to overtake Taiwan in the global league. This is not an unfamiliar case and there is a lesson to be learnt.

Economic development is our bread and butter. It is my wish that it would be free from whatever domestic disputes or conflicts that might arise in future.

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