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7.

Democracy is, of course, more than just a philosophical ideal. It is, for instance, an essential

element in the pursuit of economic progress.

Let me give

Without the Rule of Law

an example of what I mean. buttressed by democratic institutions, investors are left unprotected. Without an independent Judiciary enforcing laws democratically enacted, businesses will be

vulnerable to arbirary political decisions taken on a whim a sure recipe for a collapse in confidence and a powerful deterrent to investors from overseas.

8.

So democracy brings benefits as well as

representing values. It helps to create the sort of society, as well as the business opportunities that first attract talent and capital to Hong Kong and then retain

them here.

9.

Other

In tackling constitutional development, there are some things we can change immediately in order to strengthen our representative institutions. improvements are longer-term and relate principally to the 1995 elections. These will require consultations

with the Chinese Government.

They will also need to

reflect the views of the community and to win the support

of this Council.

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