XN000022-1993-11-02 — Page 2

TUESDAY, NOVEMBER 2, 1993

GOVT FIRMLY COMMITTED TO DOLLAR LINK

THE GOVERNMENT IS FIRMLY COMMITTED TO MAINTAINING THE DOLLAR LINK IN THE FUTURE, THE FINANCIAL SECRETARY, MR HAMISH MACLEOD, SAID TODAY (TUESDAY).

ADDRESSING THE 30TH ANNIVERSARY CELEBRATION DINNER OF THE CHARTERED INSTITUTE OF BANKERS-HONG KONG CENTRE,

MR MACLEOD SAID A FIRM MONETARY ANCHOR WAS ESSENTIAL FOR FINANCIAL STABILITY.

"THE LINK HAS BUTTRESSED CONFIDENCE IN THE HONG KONG DOLLAR AND HAS SERVED HONG KONG WELL.

"IT IS SIMPLE AND TOTALLY TRANSPARENT, AND HAS WEATHERED TIMES OF POLITICAL AND ECONOMIC DIFFICULTIES," HE SAID.

HE

POINTED OUT THAT VARIOUS MONETARY REFORMS HAD BEEN INTRODUCED OVER THE YEARS TO STRENGTHEN OUR MONETARY MANAGEMENT TO DELIVER EXCHANGE RATE STABILITY, THE LATEST BEING THE ESTABLISHMENT OF THE HONG KONG MONETARY AUTHORITY ON APRIL 1 THIS YEAR.

HE STRESSED THAT MONETARY STABILITY WAS CRUCIAL TO THE CONTINUED STABILITY AND PROSPERITY OF HONG KONG IN THE RUN UP TO 1997 AND BEYOND.

ON THE BANKING SECTOR IN HONG KONG, MR MACLEOD NOTED THAT THERE ARE A TOTAL OF ABOUT 360 AUTHORISED INSTITUTIONS FROM ABOUT 40 COUNTRIES DOING BUSINESS IN HONG KONG AND 79 OUT OF THE WORLD'S TOP 100 BANKS HAD A PRESENCE HERE IN ONE FORM OR ANOTHER UNDER THE BANKING ORDINANCE.

HE FURTHER POINTED OUT THAT THE EXTERNAL ASSETS OF THE BANKING SECTOR WERE THE FOURTH LARGEST IN THE WORLD AND THE FOREX TURNOVER WAS THE SIXTH LARGEST IN THE WORLD.

FOR

HONG KONG ALSO HAS THE LARGEST MARKET CAPITALISATION IN THE ASIAN STOCK MARKETS OUTSIDE HONG KONG AND IT IS A LEADING CENTRE THE GROWING DRAGON BOND MARKET, HE SAID.

IN

WERE

BANKS, HE SAID, FUNCTIONED AS A RESOURCE ALLOCATOR CHANELLING RESOURCES FROM THOSE WITH SURPLUS FUNDS TO THOSE WHO IN NEED OF FUNDS, SUCH AS IN TRADE FINANCE, IN HELPING PEOPLE TO BUY THEIR OWN FLATS AND IN FINANCING INFRASTRUCTURAL PROJECTS.

THEY ALSO PLAYED AN IMPORTANT ROLE IN PROMOTING HONG KONG AS AN INTERNATIONAL FINANCIAL CENTRE, HR SAID, NOTING THAT MANY INTERNATIONAL COMPANIES AND CHINESE ENTERPRISES WERE RAISING FINANCE IN HONG KONG AND THE BANKING SECTOR PROVIDED EFFICIENT SERVICES ΤΟ FACILITATE THESE FINANCING ACTIVITIES.

ON THE PROSPECTS OF GROWTH OF THE FINANCIAL SERVICES SECTOR, THE FINANCIAL SECRETARY BELIEVES THAT HONG KONG WOULD CONTINUE то BENEFIT FROM THE DYNAMIC GROWTH IN THE ASIA PACIFIC REGION.

THERE WAS