XN000022-1987-11-04 — Page 35

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WEDNESDAY, NOVEMBER 4, 1987

HE SAID HE ENDORSED THE GOVERNMENT'S PLAN TO SPEND AN EXTRA $3 BILLION OVER THE NEXT FIVE YEARS то BETTER THE SOCIAL WELFARE PROGRAMME, ALTHOUGH IT WAS, AFTER ALL, ONLY ONE AND A HALF TIMES THE MONEY THAT HAD BEEN SPENT IN 48 HOURS ON RESCUING THE HONG KONG FUTURES GUARANTEE CORPORATION.

MR LI ALSO SAID THAT DESPITE THE TURBULENT STATE OF HONG KONG'S SECURITIES MARKETS, THE FUNDAMENTALS OF THE ECONOMY REMAINED STRONG.

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"ALTHOUGH THE MANUFACTURING SECTOR IS CLOUDED BY INFLATION A SHORTAGE OF LABOUR, THIS IS CURRENTLY THE PRICE FOR OUR COMMITMENT TO A STABLE EXCHANGE RATE FOR THE HONG KONG CURRENCY.

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"UNDER THE LINKED EXCHANGE RATE REGIME. OUR ECONOMY HAS то RESPOND TO EXTERNAL CHANGES THROUGH INTERNAL ADJUSTMENT OF COSTS AND PRICES. INFLATION AND LABOUR SHORTAGE, THOUGH UNDERSIRABLE, PROVIDE THE NECESSARY ADJUSTMENT MECHANISMS FOR OUR EXPORT-LED ECONOMIC BOOM.

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1 PREFER TO SER THESE PROBLEMS BEING RESOLVED BY MARKET FORCES RATHER THAN GOVERNMENT INTERVENTION."

MR L1 SAID THAT TO CONTEND WITH MOUNTING PROTECTIONISM, HONG KONG MUST UPGRADE ITS INDUSTRIES AND MOVE IN THE DIRECTION OP "HIGH-TECH".

HR SAID THE APPLICATION OF INFORMATION TECHNOLOGY WAS THE KEY TO SUCCESSFULLY DEVELOPING HIGH-TECH INDUSTRIES AND HE URGED THE GOVERNMENT TO PAY CLOSER ATTENTION TO THIS.

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UNIVERSITIES AND OTHER TERTIARY INSTITUTIONS MUST BE PREPARED TO TRAIN THE REQUIRED PROFESSIONALS TO HELP OUR ENTERPRISES EXPLOITING THE ADVANTAGES OF INFORMATION TECHNOLOGY, HE ADDED.

"COMPUTER KNOWLEDGE SHOULD BE TAUGHT MORE EXTENSIVELY IN OUR PRIMARY AND SECONDARY SCHOOLS. THE COMPUTER LITERACY OF OUR STUDENTS MUST BE GREATLY IMPROVED."

MR LI ALSO POINTED OUT THAT HONG KONG WAS MOVING TOWARDS A GROWING INTEGRATION OF BANKING AND NON-BANKING FINANCIAL ACTIVITIES.

"AS A RESULT, THE REGULATION AND SUPERVISION OF FINANCIAL INSTITUTIONS SHOULD BE BASED ON 'FUNCTION' RATHER THAN ON 'CLASS'

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HE SAID MANY LICENSED DTC'S IN HONG KONG, BY THEIR VERY NATURE, SHOULD BE SUPERVISED AS MERCHANT BANKS RATHER THAN AS ANOTHER CLASS OF DEPOSIT-TAKING INSTITUTIONS.

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"IT WOULD ALSO BE APPROPRIATE TO USE THE NAME "MERCHANT BANKS RATHER THAN "LICENSED DTC's" BECAUSE THE NAME "DTC" LACKS RECOGNITION IN INTERNATIONAL MARKETS,"

MR LI