non
"This arrangement theoretically will divert trade and investment from non- ASEAN economies including Hong Kong.
"So far the impact is minimal as ASEAN members have de facto extended their tariff concessions to non-ASEAN economies on an MFN basis. We would encourage our ASEAN partners to continue this exemplary practice and would work with them to this end in the context of the APEC liberalisation programme."
Second, as the Financial Secretary pointed out, development of ports in the two places may result in some of the goods being shipped directly instead of re-exported through Hong Kong.
"This would accelerate the structural shift in our indirect trade from re-exports to transhipment and off-shore trading," he said.
Third, there would inevitably be keen competition between Hong Kong and some of the fast growing ASEAN economies, in exporting to traditional developed country markets, in serving as a services hub, and in attracting foreign investment, Mr Tsang said.
"The challenge for us is to capitalise on our comparative advantages and develop functional specialisation which fosters complementary rather than duplication with our ASEAN partners," he said.
"And I am optimistic that concerted efforts in the Hong Kong-ASEAN partnership would bring about mutual benefit and enhanced growth in the region."
Mr Tsang concluded by emphasising Hong Kong's need to hold fast to its fundamental belief in free trade and non-interventionist policies.
End