XN000022-1995-10-19 — Page 4

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I sympathise with you. There is a tendency, when governments are presented with problems, everywhere in the world, for them to think that the answer has got to be more regulation and higher spending. And we should, whenever we feel obliged to regulate more, see where we can remove regulations or red tape. But if the world out there starts to think that 'made in Hong Kong' doesn't mean quality, if the world out there continues to see us with health and safety at work statistics which are the sort you would normally see in a third world country, if the world out there thinks that our financial markets aren't squeaky clean, then we won't be as prosperous, whether we're small and medium enterprises or large ones.

Inflation has been an intractable problem in Hong Kong. Well, intractable up to a point. Inflation, at its peak in 1991 was at 13.9%, and we've got it down to about 8.5%. Still much higher than I, as an old fashioned Tory, think should be acceptable and we must go on working on it. I don't have a pat answer to you. What I can promise you is that we will continue to try to ensure that the costs of government are as reasonable and low as possible and that we will continue to try to ensure that Hong Kong enjoys low taxes, that we will continue to give a lead in bearing down on costs. And we hope that the rest of the business community will join us in that.

Next question? Now that somebody has broken the ice.

Question (Christopher Mak, Canadian Chamber): The unemployment rate, interest rate or the office rent, they are all cyclical and contemporary. Can I ask a question about the fundamentals or something eternal. Of all the achievements and miracles achieved by Hong Kong in the past years, as you mentioned, they are all built up on rule of law, as exemplified by the Bill of Rights by which the government in power and the man in the street are treated less unequally. And over the Northern side of the Shenzhen River, or maybe timely after 1997, the Government in power, they believe in the role of law instead of rule of law. The function of law is instrumental rather than eternal. They serve the purpose of the contemporary government. So, do you think there is any grey zone between the role of law and rule of law? If yes, where? If no, are you going to fight another losing battle?