XN000022-1993-03-03 — Page 61

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WEDNESDAY, MARCH 3, 1993

SECONDLY, I THINK IT'S TRUE WHAT I SAID IN THE BUDGET SPEECH, AND I MEAN IT, THAT THE DEGREE OF CONSULTATION WITH LEGCO MEMBERS GOES WAY BEYOND ANYTHING WE'VE EVER TRIED BEFORE. I THINK THE RESULT FROM MY POINT OF VIEW AND I HOPE FROM LEGCO MEMBERS' POINT OF VIEW SHOWS IT'S BEEN VERY WELL WORTH IT AND I WILL CONTINUE DOWN THAT PATH IN THE FUTURE YEARS.

THIRDLY, IT IS A VERY OPTIMISTIC, GOOD BUDGET IN THE SENSE THAT IT HAS A LOT OF GOOD NEWS IN IT AND I THINK THAT IS REALISTIC. WE DID MENTION A FEW CHALLENGES WHICH LIE AHEAD, FRANKLY CHALLENGES WILL ALWAYS LIE AHEAD, LIFE ALWAYS HAS RISKS TO IT BUT THE BALANCE OF PROBABILITIES FOR OUR FUTURE IN THE NEXT FEW YEARS LOOKS EXTREMELY GOOD AND I THINK THAT'S WORTH REPEATING.

APART FROM THAT, THE OTHER THING I THINK THAT'S WORTH EMPHASISING THE THEME THAT I'D MENTIONED, WE REALLY ARE LOOKING TOWARDS 1997, QUITE A LOT OF WHAT WE ARE DOING IS LAYING THE GROUNDWORK FOR MUCH BETTER ECONOMIC LINKS WITH SOUTHERN CHINA. AGAIN, THAT SEEMS TO ME ONLY REALISTIC AND SENSIBLE. THAT'S WHERE OUR MAIN GROWTH IS NOW COMING FROM. I'LL STOP THERE, AND READY FOR QUESTIONS.

IS

QUESTION:

+ +

(INAUDIBLE)

.THE LIMIT ON BANK MORTGAGE. CAN YOU TELL US WHAT CRITERIA WOULD YOU ADOPT IN JUDGING WHEN THE TIME DOES COME TO EASE OF LIMIT AND WHETHER THAT WILL OCCUR IN THE NEAR FUTURE.

FS:

WELL,

I KNOW THERE'S A LOT OF INTEREST IN THAT, PARTLY FROM CONSUMERS AND PARTLY OF COURSE FROM PROPERTY DEVELOPERS, WHO MAY HAVE SLIGHTLY DIFFERENT INTERESTS. WE DON'T HAVE A NICE EASY FORMULA FOR JUDGING THIS, IT'S NOT AN EASY THING TO JUDGE, BUT CERTAINLY WE LOOK AT STATISTICS EVERY MONTH BOTH THE SELLING PRICE STATISTICS, THE VOLUME OF TRANSACTION STATISTICS AND OF COURSE THE BANKING COMMISSIONER LOOKS AT OTHER FIGURES WHICH ARE HIS PARTICULAR CONCERN IN RELATION TO BANKS EXPOSURE TO PROPERTY BORROWING AND OUT OF THAT ARISES A DECISION, AND ALL I WAS ABLE TO SAY WAS, FIRSTLY THAT I AM STILL NOT CONVINCED THAT WE'VE ARRIVED AT A STAGE WHERE WE SHOULD BE RELAXING OR STIMULATING THE MARKET. AND, SECONDLY IF YOU LOOK AT THE REDUCTION IN PRICES WHICH HAS BEEN MUCH TALKED ABOUT, THE REDUCTION IN PRICES IS ACTUALLY QUITE SMALL AND IF YOU LOOK AT A PERIOD OF A COUPLE OF YEARS OR

WE'RE STILL VERY, VERY HIGH IN RELATION TO WHERE WE WERE IN JANUARY 91 OR IN RELATION TO ABILITY OF PEOPLE TO PAY. I SUSPECT WE'RE IN QUITE A FUNNY SITUATION AT THE MOMENT ON PROPERTY PRICES THAT THERE'S A LOT OF WAIT AND SEE AND WE'RE NOT REALLY SEEING THE REAL PRICES EMERGING FROM THIS GAME, NOT GAME BUT EXERCISE OF TRYING TO GET A FEEL FOR WHERE THE DEMAND IS GOING TO PUT THE PRICES IN THE LONGER TERM.

80, I HAVEN'T ANSWERED YOUR QUESTION BECAUSE IT'S NOT ANSWERABLE, BUT I DON'T SEE A VERY EARLY RELAXATION BUT I'M NOT SIGNALLING THAT THERE NEVER WILL BE ONE, THAT WOULD BE STUPID.

QUESTION:

So,

ARE YOU NOT, YOU KNOW PEOPLE RECEIVING IN ONE HAND, ARE YOU SURE IT'S NOT GOING TO GO OUT THE OTHER GIVEN THE FACT THAT WE'RE NOW TALKING ABOUT 12 TO 13 PER CENT INFLATION DUE TO YOUR EXTRA SPENDING AND TAX REDUCTIONS?

/FS: