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1906
HONG KONG LEGISLATIVE COUNCIL
14 July 1988
environment-this will be imposing a heavy burden and this is not practicable at all, and so I think we should reword article 109.
As for article 111, it says that no exchange control policies shall be applied in the HKSAR. Again, this is an administrative article. It is simply impossible for us to predict what would happen in future. Under cetrain emergency circum- stances, we may need exchange control, so if we have such articles written down in the Basic Law the Government will lost the authority to adapt to new changes, and this is indeed very dangerous.
As for articles 112 to 114 concerning monetary policies, we should again consider whether these should be written down.
On article 115 concerning issuance of currency, Hong Kong will not have a central bank, and according to the experience of the central banking systems in foreign countries, it is not desirable to let the Government directly control the issuance of currency, so I think we need to preserve the system of having more than one bank issuing currency. That is why I think this is very appropriate to have such an article. This will maintain the independence of issuance of currency.
Sir, as for Exchange Fund, I think we should reword this article. The issue of Hong Kong currency should be backed by an exchange fund with no less than 100 per cent freely convertable foreign currency, and we have agreed on this in our panel.
On external trade and economic relations, articles 117 to 121 are detailed articles but I think this is necessary because Hong Kong's economy is chiefly export-led, and I think we should accept such an article if we want to maintain our status as a trade centre in the region.
And then, on articles concerning industry, commerce and other trade, article 122 speaks about practising free and open policies regarding industry. commerce and other trades, but what does it mean by free and open policy? Again, these are policy articles, and we do not have a very good definition of the term 'other trades'. It is not so that the Government has no control over all trades now, one obvious example is that the Government does have a price control over rice, so I think we must seriously consider rewriting this article or it will lead to disputes.
Article 123 stipulates that the Government of the HKSAR shall create the necessary environment and conditions for encouraging industrial investment, technological progress, and the development of new industries. Again, this is a policy article. The intention is good, but this is vague and unclear. It is open to dispute, and a lot of people can use this article to allege that the Goverment is violating the constitution, and people may also suspect the Government would like to use administrative means to interfere with industrial and commercial activities, and the result may not be good for investment. So I think we should consider amending this.