XN000022-1994-08-05 — Page 3

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FRIDAY, AUGUST 5, 1994

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INTRODUCTION OF HANG SENG CHINA INDEX FAR-SIGHTED STEP

THE INTRODUCTION OF THE HANG SENG CHINA ENTERPRISES INDEX IS A FAR-SIGHTED STEP FORWARD IN THE DEVELOPMENT OF HONG KONG'S FINANCIAL MARKET AND REAFFIRMS THE INCREASING SYNERGY BETWEEN THE HONG KONG AND CHINESE ECONOMIES, THE ACTING FINANCIAL SECRETARY,

MR DONALD TSANG,

SAID TODAY (FRIDAY).

SPEAKING AT THE COCKTAIL RECEPTION TO LAUNCH THE NEW INDEX, MR TSANG SAID THE LISTING OF CHINESE STATE-OWNED ENTERPRISES IN THE STOCK EXCHANGE OF HONG KONG WAS AMONG THE MOST SIGNIFICANT DEVELOPMENTS OF THE LOCAL MARKET IN RECENT YEARS.

THE IMPLICATIONS OF THESE LISTINGS WERE MANIFOLD, HE SAID.

"FIRST, SUCH LISTINGS INCREASED OUR MARKET CAPITALISATION AND BROADENED THE BASE OF LISTED COMPANIES IN OUR MARKET.

"SECONDLY, THEY HAVE BROUGHT TOGETHER THE REGULATORS AND EXCHANGES ACROSS THE BORDER UNDER A FRAMEWORK WHICH IS AIMED AT PROVIDING SUFFICIENT PROTECTION FOR INVESTORS."

ABOVE ALL, MR TSANG SAID, THESE LISTINGS DEMONSTRATED HONG KONG'S ROLE AS AN EFFECTIVE SPRINGBOARD FOR THE CHINESE STATE-OWNED ENTERPRISE TO TAP OVERSEAS CAPITAL.

"THE PROCESS CREATES A TOTALLY NEW DIMENSION FOR THESE ENTERPRISES AS WELL AS FOR THE LOCAL STOCK MARKET," HE SAID.

WITH MORE "H" SHARES BEING LISTED IN HONG KONG, IT WAS LOGICAL AND OPPORTUNE TO INTRODUCE AN INDICATOR REFLECTING PRICE MOVEMENTS IN THIS RELATIVELY NEW SECTION OF THE LOCAL STOCK MARKET, MR TSANG SAID.

"THE NEW INDEX WILL NO DOUBT GAIN SIMILAR ACCEPTANCE AND STATUS AS THE HANG SENG INDEX LOCALLY AND INTERNATIONALLY.

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"APART FROM BEING AN INDICATOR OF THE PRICE MOVEMENTS

"H" THE ADVANCED SHARES, I ALSO EXPECT THAT

MARKET PRACTITIONERS WILL

GRASP THE

TO USE THE NEW INDEX IN DEVELOPING DERIVATIVE PRODUCTS IN RESPECT OF THE NEW INDEX.

OPPORTUNITY SOON

"THIS FITS WELL INTO OUR OVERALL STRATEGY OF ENCOURAGING MARKET DEVELOPMENT AND WILL REINFORCE HONG KONG'S ROLE AS A FINANCIAL CENTRE CATERING FOR THE HUGE POTENTIAL PRESENTED BY THE FAST GROWING CHINESE ECONOMY, MR TSANG ADDED.

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CHINA'S ACCESSION TO GATT

"THE MISSING PIECE IN THE JIGSAW PUZZLE":

D-G OF TRADE

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TODAY

THE DIRECTOR-GENERAL OF TRADE, MR TONY MILLER, SAID (FRIDAY) HE WAS OPTIMISTIC ABOUT CHINA SHORTLY RE-ENTERING THE GENERAL AGREEMENT ON TARIFFS AND TRADE (GATT).

SPEAKING AT A LUNCHEON MEETING OF THE LION'S CLUB OF HONG KONG, MR MILLER SAID CHINA'S ACCESSION TO THE GATT WAS VITAL FOR THE SUCCESS OF THE FUTURE WORLD TRADE ORGANISATION (WTO).

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