XN000022-1983-12-07 — Page 24

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WEDNESDAY, DECEMBER 7, 1983

MARKET FORCES ROLE STRESSED BY SIR JOHN

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THE GOVERNMENT FUNDAMENTALLY BELIEVES THAT IT IS NOT ITS BUSINESS TO BE DAILY IN THE MARKET PLACE, THE FINANCIAL SECRETARY, SIR JOHN BREMRIDGE, SAID THIS (WEDNESDAY EVENING.

SPEAKING AT THE FOURTH ANNIVERSARY DINNER OF THE HONG KONG STOCKBROKERS ASSOCIATION, SIR JOHN SAID, WE EXPECT THAT INDUSTRY AND COMMERCE APPRECIATE THAT THIS LACK OF INTERFERENCE HELPS THEM TO GET ON WITH THEIR JOB OF PRODUCING AND BUYING AND SELLING.

+AND WE ALSO EXPECT THAT INDUSTRY AND COMMERCE ACCEPT THAT MARKET FORCES MEAN REWARD FOR THE SUCCESSFUL AND NO RETURN FOR THE FAILURES — WITH NO LAME DUCK POLICY BY GOVERNMENT.

HE SAID THAT TWO MAIN FACTORS GOVERN WHEN AND WHY THE GOVERNMENT INTERVENES IN THE ECONOMIC AND FINANCIAL SCENE.

AS AN EXAMPLE OF THE FIRST FACTOR, SIR JOHN REFERRED TO HONG KONG'S LATEST SUCCESS IN EXPORTS WHICH WAS BEING THREATENED BY FACTORS OUTSIDE THE MARKET MOVING TO UNDERMINE THE LOCAL CURRENCY.

+THE GOVERNMENT DID NOT HESITATE TO ACT. WHEN WE ACTED, WE ACTED DECISIVELY AND WE HAVE RESTORED THE BASE THAT INDUSTRY AND PARTICULARLY OUR EXPORTERS NEEDED, HE STRESSED.

ON THE HANG LUNG BANK AND THE HONG KONG DOLLAR, SIR JOHN SAID, THERE WAS A NEED TO MOVE TO AVOID UNACCEPTABLE COLLAPSE.

THE SECOND GOVERNING FACTOR IS WHEN SELF REGULATION UNDER HONG KONG'S SYSTEM OF PRUDENTIAL SUPERVISION IS FLOUTED AND THE LAWS AND GOOD NAME OF THE TERRITORY ARE THROWN INTO DISREPUTE.

+THAT IS WHAT WE CLEARLY DID OVER CARRIAN. AND I DO NOT THINK THAT ANY OF YOU WOULD DOUBT ANY LONGER THAT WHEN WE DECIDE WE MUST ACT, WE ACT WITH VIGOUR, HE SAID.

BUT THE GOVERNMENT STILL BELIEVES IN THE MERITS OF SELF DISCIPLINE AND REGULATION.

+THAT IS WHY WE HAVE CHOSEN THE PATH TOWARDS DISCLOSURE OF INFORMATION BY COMPANIES TO THEIR SHAREHOLDERS AND THE MARKET.

THE ROLE OF THE GOVERNMENT WILL BE TO ENSURE THAT THE FLOW GETS STARTED AND THAT IT IS PROPERLY MONITORED TO ENSURE THE CONTINUANCE OF THE FLOW, SIR JOHN SAID,

HE PAID TRIBUTE TO MEMBERS OF THE ASSOCIATION FOR THEIR WORTHWHILE SERVICE TO THE MANY PRIVATE INVESTORS OF HONG KONG.

NOTING THAT HAPPY STOCKBROKERS WERE GENERALLY A SIGN OF AN ECONOMY WHICH IS DOING WELL, HE POINTED OUT THAT THE TERRITORY'S EXPORTS WERE BOOMING SO MUCH THAT TRANSPORT JUST MANAGED TO COPE.

HE DESCRIBED THE INCREASE IN MOVEMENT OF HONG KONG-MADE GOODS TO BE +LITTLE SHORT OF FANTASTIC+ AND SAID THAT THE TERRITORY HAD AGAIN SHOWN ITS RESILIENCE AND ITS SPEED OF RECOVERY.

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