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by direct election in any form for election to the Legislative Council or of its Chief Executive. In my view, any intention to build a power base to resist China is a non-starter. We should all know by now that the future of Hong Kong as an economically viable, prosperous area does not come about because of the Joint Declaration. It comes about because of China's recognition that the existing system in Hong Kong, which is different from that in China, is beneficial to China and beneficial to Hong Kong.
Inevitably, if China goes through another political turmoil, Hong Kong will be affected, both economically and politically, irrespective of the Joint Declaration. However, if China follows the current policy of opening to the outside world and maintains its strong desire to attract foreign investment, Hong Kong will play a major part in the entire process.
Hong Kong cannot be looked at in isolation. It must be looked at as part of China beyond 1997. Those who decide to stay in Hong Kong, or return to Hong Kong after satisfying themselves on the passport issue beyond 1997, will contribute to the continued success of Hong Kong and will benefit from an economy that is of growing importance to China, acting as one of the principal and most efficient gateways between it and the rest of the world.
I therefore feel that the Chief Executive must be a person who is approved by the Mainland's leaders and one who commands certain respect internally in Hong Kong and externally from China. I therefore believe that the Chief Executive should be selected from among the membership of the Legislative Council. It should be a person who has obtained support from either the public, the functional constituencies or the electoral colleges and who has the support of a majority of the members of the legislature.
I believe that the selection of the Chief Executive should be by voting within the Legislative Council members. A nominating commission should be formed to come up with two to three names for members of the legislature to vote on with the final approval obtained from Mainland leaders.
I continue to be against any form of direct election to the Legislative Council for reasons I have given many times and which I will not repeat here. The Hong Kong Government has, however, committed to introduce 10 directly elected seats to the Legislative Council in 1991. This should be looked at as an experiment. At some subsequent date a review should be made of its success and of the desirability and the need to have directly elected seats. If it is then found to be desirable, consideration should then be given to the ratio the directly elected seats should bear to the total number of seats in the future Government of the HKSAR.
Hence, I believe that the Basic Law should only mention that the legislature shall be constituted by 'election'. The mix of the elected seats should not be decided now. The time to run to 1997, the changes that will take place in the awareness of the public in political affairs, as we get nearer to 1997, and the possible evolution of political parties are all factors to be considered before a decision can be reached. As a part of a future sovereign state that is currently and will in the years ahead be going through enormous changes, and in an environment in which participation in politics is still in its infancy, I think it is undesirable to be too quick to fix a political structure that will have to be lived with for many years into the future.
Thank you.
Policy Guidelines regarding Sections 1 to 4 of Chapter V Recitals
Appendix I
(A) It is intended that the HKSAR Government shall have independent finances and shall follow the principle of measuring expenditure by revenues in drawing up its budget;
(B) It is intended that the HKSAR Government shall practise an independent taxation system and a low tax policy and the rate of increase of budget revenue and expense of the HKSAR will not exceed the rate of increase in the gross domestic product taken over a number of fiscal years;
(C) It is intended that the HKSAR Government shall create conditions and take measures for the maintenance of the status of the HKSAR as an international financial centre;
(D) It is intended that HKSAR Government shall practise free and open monetary and financial policies and shall safeguard the free operation of financial business and financial markets;
(E) It is intended that the HKSAR Government shall safeguard the flow of capital, goods and intangible assets within, into and out of the HKSAR without undue restrictions;
(F) It is intended that the HKSAR Government shall adopt the policy of maintaining a free port;
(G) It is intended that the HKSAR Government shall adopt the policies of free external trade and free external economic relations;
(H) It is intended that the issue of any HK currency shall be soundly based and that the arrangements for such issue are consistent with the object of maintaining the stability of the currency;
(I) It is intended that the Exchange Fund of the HKSAR Government shall be used primarily for regulating the exchange value of the Hong Kong dollar;
(J) It is intended that the HKSAR Government shall practise free and open policies regarding industry, commerce and other trades;
(K) It is intended that the HKSAR Government shall create the necessary environment and conditions for encouraging industrial investment, technological progress and the development of new industries;
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