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of course much concerned about the matter. I hope therefore that the government will cut down on expenditure in order to achieve optimum utilization of resources and avoid large increases in tax.

(iii) To maintain and promote the stability of Hong Kong after 1997, both China and Britain should actively seek recognition by other countries of the unique status of Hong Kong so that its ties with foreign countries will be maintained and its people able to travel abroad and participate in various business activities. In addition, the Chinese Government should continue to fight for admission to international economic and trade arrangements so as to better guarantee Hong Kong's ties with the rest of the world.

(iv) The people of Hong Kong should strive to establish as early as possible a democratic system of government. I firmly believe that only a government constituted by elections by the local population will be in a position to implement the concept of Hong Kong people governing themselves. It will be more lawful, with the people monitoring it, and fill the political vacuum left by the withdrawal of the British Government. The authorities should therefore arrange for one-fifth of the seats of the Legislative Council to be directly elected in 1988 and carry out periodic reviews on the terms of reference of the Executive and Legislative Councils and their relations with each other, with a view to rationalizing the system of government.

(v) The British Government should take up her responsibility for the administration of Hong Kong during the thirteen-year transitional period so as to ensure steady progress for the territory. She should co-operate with the Sino-British Joint Liaison Group to effect a smooth transfer of government to Hong Kong people. I hereby call on the Joint Liaison Group to set up its office and take the initiative to collect public opinions in Hong Kong for submission to the Chinese and British Governments.

(vi) Both governments should explain to the people in Hong Kong in detail the implications of the Joint Declaration through the various media so that the public will have a better understanding of the future arrangements. Finally, I wish to appeal to the people of Hong Kong to fully express their views which may have a great influence upon the drafting of the Basic Law and development of Hong Kong's governmental system.

Sir, with these words, I support your motion.

(The Honourable Maria W. C. TAM and Mr. Edmund W. H. CHOW left at 5.25 p.m.)

MR. FREDERICK K. K. FUNG (in Cantonese):-Mr. Chairman,

Introduction

The Chinese and British governments initialled on 26 September morning in Beijing a Joint Declaration on the future of Hong Kong, setting out in detail the guiding principles in respect of 14 issues. The Declaration basically reflects the present conditions of Hong Kong which may go on for 13 years. It could be gathered from the Declaration that there will be a smooth transfer of government in 1997 when both sovereignty and administration of Hong Kong will be reverted back to China. This will have a stabilizing and positive effect, ending the many conjectures by various quarters on the future of Hong Kong.

Basically I support the Declaration and wish to say something today on how Hong Kong people should face the changes in the future with the understanding that its society will, by and large, remain unchanged.

Expected changes

My interpretation of the Joint Declaration is that neither the Chinese nor the British government would wish to see much change in the conditions of Hong Kong which should develop along its present path. However, we could also detect certain changes, not in the economic or legal systems, or in the rights and freedoms, but in sovereignty and government structure.

The following changes would be inevitable when sovereignty and administration of Hong Kong are transferred from Britain to China in 1997:

1. The Chinese flag will replace the Union Jack.

2. The chief executive will be a Chinese instead of an English.

3. There will be a Chinese, instead of British, garrison in Hong Kong.

4. Hong Kong will be subject to the Chinese, instead of the British, constitution.

5. Following these changes, there will also be some technical realignment in the matter of finance, international trade and arrangement of travel.

In government structure, the Joint Declaration proposes a newer and more ideal political system than that in force in Hong Kong. An elected system will replace the present appointee system. It proposes that:

1. Officials in the Hong Kong Special Administrative Region Government and the legislature to be appointed from the local people.

2. The legislature of the Hong Kong Special Administrative Region to be constituted by elections.

3. The chief executive of the Hong Kong Special Administrative Region to be selected by election or through consultation held locally.

4. The executive authorities to abide by the law and be accountable to the legislature.

The changes in sovereignty and government structure will affect to some extent the life-style, social customs, values of life and inclinations of Hong Kong people after 1997.

Identity with, faith in, and support for the future of Hong Kong through participation

When a man understands something which interests him, he would have faith in and be fond of it and do everything in his power to protect it. On the other hand,

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