XN000022-1986-11-05 — Page 34

WEDNESDAY, NOVEMBER 5, 1986

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'DON'T DRIVE PROFESSIONALS, BUSINESSMEN AWAY'

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POLITICAL AND ECONOMIC STABILITY IS VITAL TO PRESERVE THE CONFIDENCE OF ENTREPRENEURS AND PROFESSIONALS WHO PROVIDE THE DRIVING FORCE BEHIND HONG KONG'S ECONOMY, THE HON PETER POON SAID TODAY (WEDNESDAY) IN THE LEGISLATIVE COUNCIL.

SPEAKING AT THE DEBATE ON THE GOVERNOR'S ADDRESS, HE WARNED THAT EVEN IF ONLY A FEW THOUSAND OF THEM WERE TO LEAVE EVERY YEAR THE EFFECT ON OUR ECONOMY, THE SERVICES PROVIDED BY GOVERNMENT, AND ON CONFIDENCE IN HONG KONG WOULD BE CONSIDERABLE.+

ALTHOUGH SMALL IN NUMBER, THE ENTREPRENEURS AND PROFESSIONALS SHOULDER MOST OF THE REVENUE RAISED, MR POON POINTED OUT.

OVERSEAS EMPLOYMENT PROSPECTS FOR WELL-QUAL IF IED PEOPLE FROM HONG KONG WERE IMPROVING, AND IMMIGRATION REQUIREMENTS IN THE UNITED STATES, CANADA AND AUSTRALIA WERE BECOMING LESS RESTRICTIVE. TAXES IN THESE COUNTRIES WERE ALSO BEING CUT, HE ADDED.

TO KEEP THESE PEOPLE IN HONG KONG, ANY CHANGES, PARTICULARLY CONSTITUTIONAL CHANGES, SHOULD BE EVOLUTIONARY AND NOT REVOLUTIONARY, MR POON SAID.

TURNING TO TRADE MATTERS, MR POON URGED GOVERNMENT TO MAINTAIN THE LINKED EXCHANGE RATE SYSTEM WHICH HAD BEEN RESPONSIBLE FOR THE SIGNIFICANT IMPROVEMENT IN HONG KONG EXPORTS IN THE LAST FEW MONTHS.

HOWEVER, HE WARNED THAT PROTECTIONIST SENTIMENTS IN THE UNITED STATES WERE STILL STRONG. IT WAS NECESSARY ON THE ONE HAND TO CONTINUE FIGHTING AGAINST UNJUSTIFIED PROTECTIONISM, BUT ON THE OTHER TO CONTINUE TO IMPROVE OUR COMPETITIVENESS THROUGH HIGHER QUALITY AND BETTER TECHNOLOGY AND PRODUCTIVITY.

ALTHOUGH INVESTMENT IN CAPITAL GOODS WAS RECOVERING GRADUALLY IN HONG KONG, MR POON SAID THERE WAS A NEED TO BUILD UP THE CONFIDENCE OF HONG KONG INDUSTRIALISTS SO THAT THEY COULD UPGRADE OR EXPAND THE IR OPERATIONS,

TO DO THIS, HE ADVISED GOVERNMENT TO PROVIDE INCENTIVES BY REDUCING THE TAX RATE. OTHERWISE WE SHALL SOON LOSE OUT TO TAIWAN, KOREA AND SINGAPORE,+

ON CONTROLLING GOVERNMENT EXPENDITURE

MR POON URGED THAT

THE +VALUE-FOR-MONEY+ STUDIES SHOULD CONTINUE AND TRY TO MAXIMISE COST-EFFECTIVENESS.

+ IN AREAS WHERE PRIVATISATION IS DESIRABLE. CONSIDERATION SHOULD BE GIVEN TO HIVE OFF SUCH OPERATIONS, WITHOUT AFFECTING THE QUALITY OF SERVICE,+ MR POON SAID.

HE ALSO SUGGESTED A PERIODICAL REVIEW OF THE TOTAL PAY PACKAGE FOR THE CIVIL SERVICE TO SEE WHETHER IT WAS IN LINE WITH THE PRIVATE SECTOR AND THE PATTERN OF INFLATION.