TNAG-1725-FCO40-2438-Minutes-and-Hansards-of-the-Legislative-Council-of-Hong-Kong-1988 — Page 19

15.

is

The pressure of demand and the resulting labour

shortages set in train the adjustment process, which bringing about a gradual slowdown in

slowdown in the growth rate of the

economy. In the later part of last year, the growth rate of our exports eased somewhat, and more recently there have been some signs that the pressure of demand on resources is beginning to

slacken.

16.

The events of last October in the world's stock

markets may have lessened some of the pressure on resources and thus shortened this adjustment process in our economy. Before I leave monetary and economic matters, therefore, I must say a few words about our own securities market. Much has been written

and said about the crash and its implications.. What took place

in our market was in part a response to world events. The sharp

falls were not a reflection of weaknesses in our economy.

Nevertheless, there is no doubt that our systems were shown to be less than adequate, and it was for this reason, Sir, that you appointed the Securities Review Committee to examine critically the relevant structures and systems with a view to recommending improvements. We in Hong Kong are not alone in recognising the

need to draw lessons from the crash. Other major markets, including London and New York, are conducting somewhat similar

reviews. Our Securities Review Committee, under the able AC chairmanship of Mr Ian Hay Davison, is now hard at work and we

look forward to its report.

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