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WEDNESDAY, NOVEMBER 5, 1986
MR LI SAID HE CONSIDERED THE RECENT INCREASE IN THE SIZE CRITERION FOR FOREIGN BANKS APPLYING FOR BANKING LICENCES IN HONG KONG A RETROGRADE STEP AND WAS DISAPPOINTED THAT THE DECISION WAS MADE WITHOUT FORMAL CONSULTATION WITH THE BANK ING ADVISORY COMMITTEE.
HE SAID HE FELT THE TOTAL ASSETS OF A BANK SHOULD NOT USED AS A HURDLE TO HALT THE INFLUX OF THE LARGEST BANKS OF SMALL COUNTRIES AND SAID THAT BY DENYING THESE INSTITUTIONS THE OPPORTUNITY TO ESTABLISH THEMSELVES HERE, HONG KONG'S BEST INTERESTS WERE NOT SERVED.
MR LI SAID HE WAS HAPPY TO NOTE THAT HIS LONG ADVOCACY FOR PUTTING THE OFFICES OF THE COMMISSIONER OF BANKING AND THE COMMISSIONER FOR SECURITIES JOINTLY UNDER THE SUPERVISION OF THE MONETARY AFFAIRS BRANCH WAS ANSWERED FROM LAST SEPTEMBER AS HE FELT BETTER CO-OPERATION BETWEEN AND CO-ORDINATION OF THE TWO COMMISSIONS WERE A MATTER OF PRIORITY.
HE ALSO CALLED ON THE GOVERNMENT TO ESTABLISH A SINGLE FINANCIAL INDUSTRY THINK-TANK TO ADVISE THE GOVERNMENT ON HOW BEST TO KEEP ABREAST OF THE RAPIDLY CHANGING FINANCIAL ARENA AND TO CO-ORDINATE THE ACTIVITIES OF THE NUMEROUS EXISTING ADVISORY BODIES.
MR LI NOTED THAT DESPITE THE INCREASE IN DOMESTIC EXPORTS, THE LONG-TERM OUTLOOK FOR HONG KONG'S ECONOMY REMAINED CLOUDED AND THERE WAS MOUNTING CONCERN OVER THE SLUGGISHNESS OF FIXED CAPITAL FORMATION IN HONG KONG DURING THE PAST FIVE YEARS.
HE SAID IT APPEARED THAT HONG KONG'S EXISTING LOW TAX ENVIRONMENT ALONE WAS INSUFFICIENT TO INDUCE CAPITAL INVESTMENTS AND BELIEVED THAT HONG KONG SHOULD LOOK AT WAYS AND MEANS TO ENCOURAGE INVESTMENT IN ORDER TO MAINTAIN THE MOMENTUM OF ECONOMIC GROWTH.
HE SAID THE GOVERNMENT SHOULD CONSIDER FISCAL INCENTIVES TO STIMULATE LONG-TERM CAPITAL EXPENDITURE, INCLUDING THE INTRODUCTION OF A MORE LIBERAL DEPRECIATION AND INVESTMENT ALLOWANCE SCHEME FOR THE PURPOSE OF ENCOURAGING REAL INVESTMENT IN PLANT AND NEW MACHINERY.
HE ALSO SAID THAT THE MUCH IMPROVED STATE OF HONG KONG'S PUBLIC FINANCES SHOULD NOW ENABLE THE GOVERNMENT TO CONSIDER A TAX REDUCTION ACROSS THE BOARD SINCE THE INCREASE OF A TWO PER CENT RATE IN STANDARD AND PROFITS TAX IN 1984-85 FOR BUDGETARY REASONS.
MR LI SAID HE STRONGLY BELIEVED THAT THE GOVERNMENT SHOULD EXPLOIT EVERY POSSIBILITY TO PROMOTE MORE INDUSTRIAL INVESTMENT.
*I AM IN FAVOUR OF MORE HIGH-LEVEL AND WIDELY-REPRESENTATIVE ECONOMIC MISSIONS TO GENERATE MORE DIRECT FOREIGN INVESTMENT FOR HONG KONG.
Z+MEN SHOULD