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As you can see, our latest invention creates some confusion. a minute? And all high quality. Because naturally we've equipped Is it a copier? Or is it a printer? It's both. It's the first Network this network copier with the unique Oce Copy Press Image Copier. On the one hand, the Oce 3165 is a digital copier for the Transfer System. Which means unparalleled print quality and office corridor. One that has Image Logic. This means no more virtually no chance of jams. regulating and adjusting the image quality. The Oce 3165 is a fine piece of technology. And yet just like all What's more, the original is only scanned once, then stored in Oce equipment, it's extremely user-friendly. So the only question the memory, regardless of the number of copies. And that impro it can raise when you use it is: is it a copier or a um ... ? ves the speed (62 copies per minute) and the reliability. For details, call 2577 6064 or fax 2577 8957. Connect it to your network and suddenly it also becomes a Oce (Hong Kong China) Ltd., 12/F., 1202 The Lee Gardens 8oce printer. A departmental printer that can probably replace all your 33 Hysan Avenue, Causeway Bay, Hong Kong. current desktop printers. After all, what printer produces 62 prints Smart solutions in copying, printing and plotting. CONTENTS i�Blilletin COVER STORY FEBRUARY 1999 A Hong Kong General Chamber of Commerce magazine
CHAIRMAN Peter Sutch DEPUTY CHAIRMAN CCTung VICE CHAIRMEN Dr Lily Chiang Anthony Nightingale DIRECTOR Dr Eden Woon EDITORIAL BOARD Ian Perkin Dr. Y.S. Cheung Dr. W.K. Chan Sidney Fung Louise Parkinson TRANSLATED BY Eliza Yeung Priscilla Lo ADVERTISING Carmen Ho CHAMBER SERVICES LTD Tel: 2823 1291 Fax: 2527 0380 The Chamber is apolitical. Any advertisement of a political nature does not necessarily imply• P.12 Is there a recovery in tourism? endorsement by the Chamber MrnH\Hr�UlB'il��n.l]§ ? PUBLISHED BY The Hong Kong General Chamber of Commerce ON OTHER PAGES 22/F United Centre, 95 Queensway, Hong Kong Tourism• n'ifJ1fHIL . Tel 2529 9229 Fax: 2527 9843 P.12 Recovery still tentative forHong www.hkgcc.org.hk Kong's tourist arrivals PRODUCED BY �;i!*�J-.J�)�J!@lfl- The Publisher, (address above) and P.15 Government looks to long-term OMAC Production House strategy to revive tourism 5/F EIB Tower, �-�■ �JU�*� 4-6 Morrison Hill Road, Wanchai, Hong Kong Tel: 2572 7144 Fax: 2832 7903 PRINTED BY P.38 Crime Rate - Economic crime up Excellent Printing Co slightly, but overall rate still low Flat G & H, 20/F Blk 2, Kingley Ind Bldg, �i:H$�fl- 1&11�$$1iitt 33.35 Yip Kan St, Wong Chuk Hang, HK P.39 Good citizen stops burglary tE:$:M!Utm� :=t� : ffiU1Hi -m�nu�: [email protected]; Regular F ature A� r>--J" t i&tl::E�: }ffl:JlfrJ!wt �JE¥ P.5 Editorial • *Ht �� : �12H:f:1w:± P.7 From the Director • #Ui�ifi!i IJUi��fl P.9 legco Report• fl5t:'ffI1'\=¥lx1s- &i:�BW£ s�JJ'.n.x;fi;ij± 1 < P.20 Roundtables • 1Ht/.'f:t'ff �f¥Mtw:± l.l!Hfii sf81f:Efll} P.20 EU helpful to Asian importers - EU helpful to Asian importers iUHBzillitij □ iftf$11Uffi & 11Hli$: -���§illitij □��Uffi&��n;; �� : �%J'¾ I!i,tO� P.22 - Regaining control over costs 111s : ffiJJkfift P.28 Rules change in Euro take-off -�*Y&�'!I! �!�fl�li�fl�� 0 � 1!1:5cW!Ji r.\7iffi-ffi P.26 SME Policy �� : 2823 1291 � 1NfJ.feJ\Uli� li!Xft)t : 2527 0380 The Bulletin welcomes letters and articles from Chamber members, but reserves the right to edit any material supplied. P.30 legal- Focus on GITIC affair 4i:il!itL�lcIE.k:i§Afl.�l'& , flfiif1¥Hfi!&:iil Letters or other contributions should be sent to: The Managing ���14W�±m:uxm:iE .t:�s{JJJi15-:H:J�lt=b:*iiv.� Editor, The Bulletin, The Hong Kong General Chamber of P.33 Tax• :&�Ji� tll!I& : ��--� Commerce, 22/F United Centre, 95 Queensway, Hong Kong. P.40 Staffdelight in modest Christmas �iU��1-rti-i:.,tt=tt Fax: 2527-9843. Email: [email protected] gathering �Mi 2529 9229 (I."itif!Jf/J) liJOl#.f."itifi!i!Ji.JlffiJ ·Nil, #tfj.ffiJ!ltR:/1111 ° *@ffN �fF � l,H[fF'.I: �I-!JUHHl 5c: lii1l�tl/N95§tl!t-r:f:vi)221'lifllll."ifif-.t (I.iff!Jf/J} !II.JI P.42 Chamber in Action • *�lb� 2572 7144 O Ii f1lll :2527-9843 •• : [email protected] P.46 Forecast• $iJlffl� ff<£!]-� s�£Pr&J :t, at f J:� a -t.tw {t� J__ fol u=J HKGCC SPRING DINNER 1999 10] }J�Ao 1r, M JfJ ,W,!; Jl:JJ A� A1f1 ,t:k: tltfol iE. ;;#- a� � '1Jr }J Following fiveconsecutive years of success, the SME Committee is # A_*� 00 -qt 1r lt tt% �t ��if- -=- j organising its sixth annual Chamber Chinese New Year Spring ' {f,��¾- � 1'1 ,¥-� J$J 1± i)t-- it. ft1 ntR }J o� -t ,&__ Dinner on Fridav, 12 March 1999. it J; 1,f- 3i. ft,!, T--=-rt-Jt. ��rt,,f �JI·] Ji a� -t 17 J,R it, r& � TA a ,� Thisevent has proved to be a useful and effectivemedium for ft ,!& � � 1¥- 1r, i: 1__-,1i it Jr 1� -tIJ:- l.J I T!!J ,;, 1:- if- _:. aJ ,,, � l!t memhers to express their appreciation to staff,to strengthen � ¾ ;tr-� iilL1. /]:_a� ::'.£_' »t-t1£--=.. /\ � $ 1u ties with suppliersand business partners,to entertain friends ,:!- tt,, ' ¥} it, .:::.. ' JJ rt MAilt -�� Jl: or to mingle with fellowmembers. With this ready-made #.,\R JI}J � }J --1::: 17jt 100 1; Jftr 3i.1J, 1u �f; it, -t -- -ffi) event, there are no hassles with planning, prize-raising, and � ¾ if. 00 if-,,-,. X. � Jfgp #� ' _;±::, 1u .4r- � -t --=- other logistical concerns that comeswith organising your own I=) JJ iT �t-t 1JL 1lt j,lR ¼ H$t � 3i. El t * � event. The only thing that you and your guests need to do is to enjoy I&_ ,t 1± fA a� , ,$ JI}J ' $ f;! ,t� _;_ � '.�- t: Ji � * i� 1*' � the evening's get-together. - aj - iit,� 00 K e iey �� -H �ij l.J .:::.. ,,yJi",.. 1 7J §$ F] iE. µt w - 0 /}If � � Cost of participation has been maintained at 1997 prices at .4r- ,,I=) J:.f -H a,t i 1- ,J, I=) ' ifffi �K$3,888 per table of 12 persons or HK$368 per person which .tro AA rtiE. �F � -� jJL -� ,!.\';- -t A. it, -Pt �- ::c's;_ »t 17 •� JJ includes a full Chinese banczuet with unlimited supply of beer and f' --=- 7]<. mi; -ti ft A/"\...Tl!J - 1t 1-'¥- it, jj so[Jdrinks card and/ormahiong games karaoke and lud · draws. it 0 A_' i!PJ:? it, -Pt ,:Ji. �-tit -t � l'.1 � it ii {f,� :f if-ih Date : Friday, 12 March 1999 Cost : HK$368 per head or y:). A ,t 3i. * tflf }]j] N a,ry Jt '7 � Venue: Metropol Restaurant HK$3,888 per table 00 � ll 00 �}j__ �· N _!'L � f-- 1;* 4/F United Centre Time : Games from4:00 p.m. w f' :i(- 1; '. ;:#- � f-' 1f � q_i J 0 JI}J it Jl:JJ a f� /2.. 95 Queensway, Hong Kong Dinner at 8:00 p.m. N 3i. 4t � � 0 JJL � -i;Qi �k 0 ,�, ,lft 4 We need your SUPPORT through bookings and/or donations/ ½ ii :):� "'"-' - tk. 1 �' � sponsorship of lucky draw prizes. These can be in the formof � :::1[ ,1! ::c's;._ }J :ii 1--- merchandise or cash. The function is again expected to be very well ;l -t 0 f- :fl'.1 ,if 1� attended and all contributors will have the opportunity to showcase pi:, 0 At° i {f� a their products and services beforeprospective clients. � 17 { -ft j :k._ For further details, please call Miss Karen Au at tel : 2823 1200. 1;. A ft 8� J__
Hong Kong - Guangdong Environmental Partnership Seminar on Environment and Energy � � M ,(: Ji-1% iJ fr Ji-J,ta tE.� � t0l,?;ff-it if 15 March 1999 9:15 a.m. to 5:00 pm. Conrad Hotel -��������a�+�*����T+�*�£�� According to a 1997 World Bank report, China's rapid economic growth has given rise to some of the worst pollution problems. The costs of environmental damage in deaths, sickness and lost output are estimated to be HK$421 billion or about 5% of GDP. The central government, in its Ninth Five-Year Plan (1996-2000), has pledged to double its environmental spending from 0.8% in 1995 to 1.5% of GDP by the turn of the century. On a provincial level, Guangdong will be spending up to HK$13 billion over this fiveyear period and implementing several large projects in the delta region. What is happening in South China will have a direct effecton Hong Kong given the geographical proximity and close economic ties. The Seminar will focus on promoting understanding of China's environmental policy and the business synergies arising fromcooperation between Hong Kong and Guangdong Province to clean up the environment Full details available on the Chamber website http://www.hkgcc.org.hk or by calling 2823 1200.
0 1997Jf--tlt-Jf,-4�HaHfl%-tijtl::, 4'iJ{f_,�:it.{try.�Q ✓-If%fl&r, ✓-t�fa'J�jl� ,7;t_JfUJJ:tirry1\1'J�A._4'-1J-c, ��?iJt:t9 YlHh-tJHl, 1-i.itiffe a a1J.�.t11Lit 4, 2101.t� Jt. , ���m *J:t.1..A. fe,t1H11 5% 0 {f_-$:fL1@ 1 Ji.Jf-iftr]J (1996- 2000) ;f.f., 4':'itiFlJ1-f11"-i.t.tw.:#V,l1%.Jltl::it-1¾, irw 1995lf-*;[email protected] o.8%,tw_f_ 1.5% 0 -1.i' _M __jF_z }ft � tlii>f.-;/6 '� * {f_ Ji_ 4 iUu JI:}]-irk M tl:: 13 0 it;�JG ?1% J,R :rt ' J}jd.:r:_;t {f_ .--=- � ;)+)F,i-'j -• )& 1i1@ k � J:}i m 0 w�¼��-�;t��{f_�X•�--•��•�ft,�;J;tirry---ti·���***A4�· 0 �#�i{f_����¼��;t �*a•irryTM•_;t¼��,���{f_¼�*��J:t�tlii��x��� 0 ½"t�'tf+l, -t!li� !ft¼,�.tt1,}f � #,f\1] �http: //www.hkgcc.org.hk Af.t 'l[ 2823 1200.
Sponsors ng E)f{ONI -��� [TI f'JIJJ 1tAt : cp:!j,E@.:tJ(cp�� EXXON IENERGY LIMITED �;fft;:lJl John Swire and Sons CLP Power China J!<:l'i:.Nlile)»i\:/iff� '"jsj (S:A CABLE & WIRELESS COMPANY t Jf1 eI-1��}Ju� El ,Bf-if�, -t-t--Jtat1hf Elf ♦ Full day seminar including lunch and simultaneous interpretation EDITORIAL The Hong Kong General Chamber of Commerce
Chamber Committees Chairmen Budget challenges in General Committee Chamber Council Mr Peter SUTCH the year of the rabbit Americas Mr Andrew YUEN his is truly the time of the year for reflection on past events Arab & African and re-affirmation of our faith in the future. The beginning Mr Lawrence FUNG of the new calendar year signaled that the new Millenium (atT least in terms of the Christian or Western calendar) grows Asia Mr Joseph POON ever closer. The onset of the Lunar New Year reminds us of China Hong Kong's Chinese heritage (and its Chinese future), the need Mr Tony FUNG to dispense with past baggage and to look forward to good fortune and good health in the year ahead. Economic Policy It is perhaps appropriate, therefore, that this time of renewal Mr Martin BARROW, OBE, JP and revitalisation also brings with it the presentation of the Hong Environment Kong Government's annual Budget, this year on Wednesday, Mr Barrie COOK March 3. With the prolonged impact of the Asian financial crisis Europe on both the local economy and public confidence, this year's Mr Manohar CHUGH Budget will probably be the most challenging of the Financial Human Resources Secretary, Donald Tsang Yam-kuen's career. It will be even more MrYun POON challenging than the 1996-97 Budget straddling the return of Hong Kong sovereignty to China. Peter Sutch, Chamber Chairman. lndustr and Technolo Committee In fact, the Hong Kong Government this fiscal year (1999- Dr Lily CHIANG 2000) probably faces its toughest Budget task in almost two decades. It is for this reason that the Legal Chamber presented its own Budget submission to the Financial Secretary some months ago. The Mr R TGALLIE submission contained a range of recommendations aimed at restoring confidence in the local Membership economy, improving employment prospects and setting Hong Kong toward a more prosperous Ms Fanny LAI future, without sacrificing Budgetary prudence. Shipping In the past year, the sharp downturn in the local economy, now expected to result in a real Mr Terence SIT five per cent contraction in Gross Domestic Product (GDP) for 1998, effectively left the Small & Medium Enterprises Government's 1998-99 Budget plans in tatters. This much slower growth meant its revenue and Mr Denis LEE expenditure plans for the fiscal year could not be met. In addition, the suspension of land sales for the final three-quarters of the fiscal year left a gaping hole in the Budget, costing some $30 Taxation billion and turning an estimated $10 billion surplus into a ,projected $20 billion deficit. After Mr Roderic SAGE other revenue effects, the total deficit for the 1998-1999 year could exceed $40 billion. Hong Kong International The background to the new Budget for the 1999-2000 fiscal year is therefore not a happy Mr Brian STEVENSON one with the Government faced with lower revenues, higher expenditures, a large Budget deficit Hon and a still slowing economy. Despite a better performance in financial markets and recent Dr Lily CHIANG perceptions of a healthier economic outlook, the immediate prospects for both are uncertain. Looking ahead, therefore, the Government needs to use the 1999-2000 Budget to help boost HK Coalition of Service Industries confidence into the economy while still maintaining its prudent financial stance. This will not be easy. Executive Committee Economically, the Budget will be a difficult one for the Financial Secretary because it involves Mr Stanley KO reconciling lower revenue expectations with increased spending demands by a community Financial Services adversely affected by the financial crisis. Politically, it will be difficult because it will be presented Mr David RUAN to a new Legislative Council (elected 24 May 1998), with its diverse range of populist and Information Services business interests with competing demands. Mr Tony AU The 1999-2000 Budget is the most challenging task facing a Financial Secretary since Sir Transport/Infrastructure John Bremridge in the early 1980s. If there is one important difference between the present Mr K KYEUNG situation and that of the early 1980s it is that Hong Kong is, by any standards, a far wealthier Professional Services community today than it was then. As a result it has far stronger fiscal reserves and greater Mr Anthony GRIFFITHS overall resources to cope with the downturn. The task facing the current Financial Secretary remains, however, a daunting one. Real Estate Service From a business perspective, the broad thrust of the 1999-2000 Budget measures should be Mr Nicholas BROOKE aimed at helping to restore confidence in the local economy, enhancing economic growth, Statistics increasing employment prospects and improving the cash flow of the business sector. The Mr George LEUNG Chamber's Budget submission to Government offered some suggestions on how these aims might be achieved. We hope they find favour with the Financial Secretary when he presents his Hon Kon Franchise Association Budget on March 3. We certainly wish him well in the Year of the Rabbit. ■ Mr Eric CHIN
Associate Organisation PacificBasin Economic Council Hong Kong £Peter Sutch Mr John STRICKLAND Chairman
I iffi fa.I fiJ 19991:¥ 2 fa.l 5 -l,n9, ¾ti!t�tt, :m�{1§ 1 L'B/,JfH!B�� 0 fJr-�13/,J� ��(*®M�-) ,-��Tffl���*�;&m� PUitfaJHUff� fl* � �� � , JtlHJUI T:m {F� 9=1 � s/,JA {JJHJE 5¥0 ti * s/,J* ,µJ �JEM )l!ffjf;ft �ffll�IHt � : �fHffifJr, �•�o• , 51-R{}!m 0 jjlfrf,Ji ��,ft�ffl-���ITT��,mm�*�3A3B Jfttl�ft V*M�ffl-�¾--%��ITTT 0 ���MMa�*� ),f/ff77 6 The Bulletin February 1 999 FROM THE DIRECTOR � -t\� #; Getting information to our members ommunicating with our members is an essential task for the Chamber. It is a task which requires constant improvement, so that we can get timely information to our members. But we are sensitive C to the fact that many members do not want to be inundated with announcements or mailings/faxes from the Chamber. So we are always trying to strike a balance between getting the word to those who want it or being too diligent in our notifications. In addition, we always rely on those who get our information to pass it along to colleagues who may not be getting that information. Contained below is a summary of how we notify our members of events and information: 1. Minutes of all Chamber committees are now summarised and put on our Web site for all Chamber members to view. This includes the General Committee. (www.hkgcc.org.hk) Chamber Director, Complete minutes are only sent to committee members. I remind you that the committee chairmen/ Dr Eden Woon. secretaries contact information is on the Web site also, so you can always contact them for further �if!ilW!U��J;l.�it± 0 information on the committee 1 s deliberations. 2. Event announcements and Chamber circulars are sent out in the following ways: (1) Via email to any employee of any member company who provides us with an email address. (2) Multifax summary of events goes out every weekend to our general mailing list. (3) Mailings notifying events go out every other week to our general mailing list. (4) Advertisements and other non-time-dependent announcements are mailed out with The Bulletin once a month. (5) Special announcements of an event may be sent out via multifax or mail at any time to our general mailing list or to a specific audience list. (6) A summary of all upcoming Chamber events is periodically updated and can be viewed on our Web site. Let us know if you want to be added or deleted from any list we have. 3. Issues affecting certain members are sent out from time to time through fax or by mail to those who we believe would be most affected by them. For example, recently we have sent out a number of articles to the China Committee and others who have expressed interest on the issue of tax rebates in China. Once again, they will also be posted on the Web site. At any time, please check our Web site for the latest information, which also includes the current Bulletin, the latest Government statistics, our press releases and other articles written by our staff. The front page contains "what's hot11 and is frequently updated. You can visit our library at United Centre for more in-depth information in catalogues or journals. Finally, you can of course always call us for any economic or business information you believe the Chamber may have or can find for you. ■ 1filwr �1$fW¾t\!l�wrstm:ISI1i= 0 �1fffiB1I1i=w�:;flfr?Jc� , ::t��roJir�tN:{j¾tJJ,fra�f§'.s1•nt O 1tmf , :;fyif�:;ffiHlnt1r,a1ifil-'S- , 1�14 .;"' �{Jll�O�J=\-fN��, �-ISft1r�ZJJ\�tJJ��lt O 1fffl1/Ult, :4:ir-1LtP:Jtfif, lJJW-1fffiroJJJ�Jl:J21f:@':4:x:IIR1ffl,�,S1Wf�tR:{j¾�ttl, ?J-1f ffi�-�-���••a1m� 0 �*'*irZJJ\�mir�MM�a1�#�•mM•ntA 0 :4:ir������ffi•roJwrff*�ft�a1m�•m: 1. :f:.H.-frfriliHe•��: :4:wrB:te:wr�f.\c�t�� (�t!�$wrwr!Uc�t��) fiJftnN�W (www.hkgcc.org.hk) O �:otwr�f.\c��)( I Rwr -���•rot�0 J1�1M-ms1¾) �ffwrIJl / ll'.,$s1win�:¥42JJ\BftnN�Jl) ir�PTMSH�*1m1P,) �ITTU��W{S9�$1f-Hf 0 2.ffi�B½&*•B�a1V�%���: (1) ���r�{4{J��ir�0Rl�f&ff (�OBtR:{j¾�j�ttfJ.:l:1r) �mm�MXroJir�Vam��IBffi� 0 (3) m�-mroJwr�t��m�wi!l- 0 � ��!li(I-�ti>B*Si!l-�A�:;f���ITTWi!l- 0 �ifffl��,�ffill�B•%�roJwrff����#�Va��wi!l- 0 �irl!tJJffii!l-s1too�•:¥4Btt:ot:4:�fflW ) .Mz�AA]!fFJr ' U{j¾j�� 0 j[!;{f;'ft#NJHt/lfJ1��tf2fs:frjjj_H(4!i'lp__tfl91ff:j' lkf!!!I{lft,� 0 (6) '- 3. ��-fl: �01f-Jl:J2fil!Hf�5J'Wf�,@J�U§IUJS1fU4) :4:ir�m�{fll�••m�Jlti� 0 lf¾f§u!Jt) :4:wrlliB��fo 1f!UJ9lil�tmillfJtF,a��S1 ��•:¥nt�9lil��WffQA{m1ffULA.± 0 [P]ft, �@'.iU42JJ\PJ1:EfflW_ttULl 0 ���f�'.1::4:wrt.,JW ) 12,(if™J�JJjjJUMUl O 1:E#-!iHL.t ) PTrf�,tt,t�139 (I�� flj) ' !lfFJrITT$/:ffiftJEwt�1'' :zls:irB1ffiJrfilJJJ;;fp"fQA1filS:!:4:Wf[P] $IHJ€S1)(:ij: 0 I]U'Llft!l�P5S1ilt@, ' ��fo.:&'ft]!{FJr O 75$��ltl�As1•:¥4m,�,) �ftlm�Jt-c:p,[.,,�,1]$$�s1™11'.� ) �™1��- �l!HiJ§ 0 #�•�ZJJ\PJ��•**'ITTU�•m���Wffl,;zjs:wrW��m,.mzPTrt��� 0 ■ I iffi FI �J 1999 � 2 FI 7 SCHAEFEROTL STORAGE EQUIPMENTCO. , LTD. &!ii SCHAEFER TO ft 0 Zhenjiang Schaefer OTL Storage Equipment well equipped with modern technology. The Co., Ltd. is a joint venture between the Oriental quality of our products is guaranteed while Technology Group of Hongkong and the Fritz our services are comprehensive, ranging from Schaefer Group of Germany (the world's project design to installation and system largest manufacturer of storage products). Our management consultancy. Customers need brand new factory is erected on a 33, 000m2 only specify their storage concerns and we will site in the Economic and Technology devise a system that will enhance their logistical Development Zone of Zhenjiang, Jiangsu competitiveness. Province. We are professionally managed and HEAD OFFICE & FACTORY: WEI SAN ROAD, ETDZ, ZHENJIANG,JIANGSU PROVINCE P.C: 212009 Tel: (051 1) 888 2278, 888 2518, 888 2538 Fax: (0511)888 3008 NORTH CHINA OFFICE : 245 JIN TANG ROAD, DONG LEE DISTRICT, TIANJIN P.C: 300300 Tel: (022)2496 1494, 2439 6843 Fax: (022)2439 7111 EAST CHINA OFFICE : 243 CHANG ZHONG ROAD, SHANGHAI P.C: 200434 Tel: (021)6531 2448, 6544 2345 Fax: (021)6531 2448 SOUTH CHINA OFFICE : CHANG BAN,GUANGSHAN ROAD, TIAN HE,GUANGZHOU P.C: 510650 Tel: (020)8779 6087, 8779 6090 Fax: (020)8779 6090 HONGKONG OFFICE : 2K KWAI SHUN IND. CTR, CONTAINER PORT RD,KWAI CHUNG Tel: (852) 2615 1488 Fax: (852)2615 9711 LEGCO REPORT A wish for prosperity in the New Year s the Year of the Rabbit approaches, I wish you every success in your business and life. While the local economic restructuring is not yet over and the business community must endure this period of hardship, I sincerely hope that you will maintain your confidence in orderA to further develop your business. No sooner had my last report, urging interest rate cuts, been published, than I received, and welcomed, the news of lowering the rates again by the Hong Kong Association of Banks.However, considering five reductions within a quarter amounting to only 1.25 per cent, I feel that it is still too slow and the cutback relatively small. I will continue to push the banks to reduce rates to relieve the James Tien burden on the local business sector and speed up the economic recovery. Meeting with the Chief Executive Recently I met Mr CH Tung, the Chief Executive of the SAR, outlined the current plight of the business sector and urged him to improve the business environment. During our discussion, I suggested, for example, an immediate improvement in business licensing procedures in which the lead-time should be shortened for facilitating business launches. In the long run, the Government should establish a license issuing body undertaking all related examination procedures, currently handled by various departments. I also mentioned the ineffectiveness of the $2.5 billion Special Finance Scheme for SMEs and asked for prompt adjustments, including increasing the Government's guaranteed portion, modifying the criteria for approval, cutting the lending rates and extending the repayment period. Furthermore, I discussed with him the issue ofHong Kong's international image. In the eyes of some expatriate businessmen and tourists, the image of Hong Kong as an international metropolis has deteriorated since reunification, and there are much fewer opportunities for the local community to use English. As a result, the number of foreigners investing and touring in Hong Kong may be affected. In order to maintain Hong Kong as an international metropolis, I think the Government should promote the importance of English and Chinese languages more actively and encourage the learning of both. In the meeting, I indicated that the worsening pollution problem would play its part in tainting the SAR 1 s international image. Thus the Administration should allocate more resources to environmental protection. Overhaul of civil service structure I welcome the comprehensive review and reform of the SAR's civil service system as announced by the Government, yet I feel the action is too late. The current civil service framework has run for more than a decade and has long been criticised. Therefore, an overhaul of its system is inevitable. A month earlier, I questioned the civil service pay review system in a Legco meeting. I suggested that the basis for a civil service pay review - the survey findings on pay trends in the private sector - cannot reflect the real picture of the employment market inHong Kong. The survey mainly covered large private corporations with employees ranging from as many as 1,500 to around 100 persons, but SMEs, with less than 100 staff, amounting to over 90 per cent of the local business sector, are surprisingly excluded in the study. In the present economic turmoil, these companies are the hardest hit and the fluctuations of their salaries/wages are the best reflection of the general market situation in the private sector. The negligence of the Government in this respect is not acceptable. Moreover, the survey focuses only on the pay figures, ignoring the attempt by the private sector to cut labour cost through means such as downsizing and the like. Evidently, findings from the survey seriously distort reality. The inaccurate results lead to overwhelmingly high wages for civil servants when compared to employees in the private sector. More than that, the pay scale is only one of the many revisions which need to be done in the existing civil service framework. The SAR Government will face an uphill task in such a restructuring process, and tangible outcomes may not be expected in the near future. Bills Committee I have joined the Bills Committee for the District Councils Bill in order to examine the relevant regulations on the upcoming District Board Election. The Government plans to submit the Bill to Legco in February for approval so that the election can be held late this year. ■ Your comments are welcomed. Address: Legislative Council Building, 8 Jackson Road, Central, Hong Kong Tel: 2301 3602; Fax: 2368 5292 I iffi JH-IJ 1999 1f 2 fa.I 9 b. '.ff3Rlm, :$1JL�1iz:rgrnti:���, m;$5� 0 ttrtwms�#�rJHJWJ•MrEU*�¾, I � �{t*1Jrn{Jgjfij-�JtreH�ifB"Js r , 1E!��/L,\W��1iz:��WtMi,i:,\§�j1ij��� , m;•,ft�-4����m-���o kA�*�g�X-�ili��,�B��-fi0·�����$�mg,��*ffia @ 0 ��,��-fi�fflA�liN�gR�-M=li,���fi�fil�*�'�m�-� JE O �•*tHl�*itHrf!i'�tml1EbrlJ$' Ll�f�I�{t*s"Jfdt' JJP'���1IJ1 ° �� 1rl Fftrwr � JU-r igt� '§ =if J!.5t:1:.fl9(I ,& � JI!. El FftrB� ffifti rnii , Mz *iEJOtI� i:!� � if�fflm , fftl�p Jtl:!P i:!� � �J AA!tlf ff,f.iM�]:�f�B�r�, ,Llt�Itb�J=if!i'�j{� ; -lH!rm�,l!&m�w:Jt-1tm�-s"J!JJWMtl , 1Jffr:J:JU-rEB$ftmff�F�,ii}it.lfB"J �ff 0 ���=+liffl���ffi}ttt��w:•*��m-$,�*l!&m��-�,��m�l!&m�•W�$-��-m� � · �ff£fl!itflJ,@, · filffeJlt)(M� 0 11t6'�, �t�;j1J:f:1grf:i1:i:5t±&fl9cwi:ls"JII �l**FA5»! 0 ft-®J��to•��H� �, wms� 11�kkt�¾**ft@JiHt�itr M@,fflffl���-¾�LlFitr**�y,���¾,��it�WJ��A±�-��•wm��� 0 ���wm�aaw:� 11�-kkl�wr ' l!&m&\;JUI!fttim1!§ffiX =tM"J£�'ti ' iJ:liJrp�ti�XfP�X�ifJHt:m O 577� ' �t!?A�iliB -�ft�1'5� FA5»!, �tt-wHJ�wms"JII�**, mul!&m�±ttifflJ! , no�tfflWI11= 0 ���m����OO�M��-0���N,��*���,���fi�$$*B 0 fflfi�0���ffl+$'.ff**� ff�,1rlB•A��,��OO�-¾-m��� 0 ��,�A���0�����R•t:1�,ftJt�-���m-� 0 �fflili��0����tmi•*•�rUitMffl��-��lf�*J,**��&�-� 0 �Rlf�ti*R•�mm� :xs"JflA0P], �®��fi�ii:1�1sooA, �YB�?JJ'�-sALlk; m�1b�m1t*i@�iEI�nw:, �rFl,A�YJJt-s A��1Nf!it*,Jt�1:ERlfZ�V O JJl�#����,tt�0P];J(��}Jii* ,�1i�s"J�i,i�ft!i§�&�flitt:lt$J1i�B{J ffR�N,@�mJtti�N�#����,�AftLl�� 0 ®��ft�R$tt*®�ffi�-�,���-UA0P]Llf.iM�A¥������Inx:*,�Llft��-��-fflRlf WWN�Mm���,Llffl•���*��iliffl§!Fftr0B��������AMffl���ffi� 0 ��A- 1 0�¾,��tml ••tuR¾w��oo;ttits�%rt�=*�-1J\ff�fo", mJil!&m**B�i:!1•I�1�11t�m:, ffM�&�li�m�� 0 ftB$1JP(�tfi-f�fftl1jl[;fD��¾ '� &PM;*Wi;s"J�tfi-�$�tfi*§�JH!fftl O l!&mtf+IU1:E4-4=A�;f�f§tl1jl[�JR:x ��wrw�,LlmR�4-4�mfi�$ 0 E M��ff���,�@M�M$,�fflMM¾*M&�MB����x# ( 'ff/tit : 2301 3602 , f;f.JJt :2368 5292) 10 The Bulletin February 1999 -VocationalTRAINING COUNCIL �111/A llriilI -��11•� It Pays to Train Your Own Engineers Join the Engineering Graduate 1.,raining Scheme The Vocationalttnru111Iil8ili Training Council (VTC) is inviting employers in the 1171f,l7'Stil Iffit�JfJ!l#Jltl�Hl��rJUI;fi�tz.1Ji±�J�Il--t-�'.i:wll following fields to participate in the Engineering Graduate Training Scheme (EGTS): ( a ) Building Services Engineering; �m � ( b ) Chemical Engineering; (a)§Pt�fffliffl; (h) tI Iffl; ( c ) Civil Engineering; ( b )1� * I ffl ; (i)��Iffl ( [li_ttlfl�) ( d ) Electrical Engineering; ( Jt( ( e ) Electronic Engineering; c)± Iffl; ( f ) Environmental Engineering; (d)m•Iffl; ( g ) Geotechnical Engineering; (e)m-riffl; ( h ) Manufacturing/Industrial Engineering; ( i ) Marine Engineering (Shore-base); ( f) ffi !1fI ffl ; ( j ) Mechanical Engineering; (g)±jJiffl; ( k ) Naval Architects; ( l ) Information Engineering; ( m ) Structural Engineering. **����IW-�:i:�-�xY�IW*:i:� The Engineering Graduate Training Scheme (EGTS) aims at {ttJE�B�Jf�wll��ir , �1m1FHi�I;fUrffmwwll#t , bringing about sufficient practical training opportunities for engineering graduates and students in sandwich courses to enable them to complete their training as engineers and to satisfy the training requirement of the Hong Kong Institution of Engineers for professional status. 'Bt��WtM1Ull�7J�B��wll� , :l::g"i=iJ�!iw�� , O Under the EGTS, a subsidy will be granted to a trainee being trained � t;&»!IJJffi±}Jj1ilff*s�w11it�x w��ir#�fli±!i7JJc '- under an approved training scheme. The subsidy is to help employers fF���s�-�51 0 -�XYltiwll��fPJ-�tft-Wll#t� meet the high cost of training their trainees. The subsidy will be paid through his employer as part of his salary. The subsidy period is 18 months w��M��� 1s 11mY:J , rmmr�s�w��MJ=-tu���1211 which may comprise partly sandwich and partly post-graduate training. f:l O �B# , -�:i:�wll�B�$��il�'Bff:l 5,885 5G , • The maximun subsidy period under sandwich training is 12 months. 0 The current subsidy rate is $5,885 per month for graduate trainee and �xYtti�wll�J=-lU�'Bff:l 3,500 7G $3,500 per month for sandwich trainee. The Committee on Technologist Training of the VTC is responsible **•u 133�l�w11itftDJ1rttaww11�� ffil ir�:r_m O it for the administration of the EGTS, and the training of the trainees ir���lU/irJE�:1:ftwll�- l ���wll��wll#ttim, O under the EGTS will be monitored by the Committee through appointed engineering supervisors. ---H---f;:;-filJlilfu�£/a ,r.vTb2'--!-�ir z1r� 71c�� �'FJ..,.R., �§p �JJ.-L;J-�R I !!!-� ' "i:iJ:P)l It!. 2836 1716 '.!!Url=IJi'i-t- If you are interested to participate in the EGTS, please telephone , _ --->...... 2836 1716 formore details or just complete and mail the coupon below. 'tw ' � tt 2Ji;T ,u * t� ' � X. * � ffe;if O ------�� To: The Committee on Technologist Training � : 7Jfffltlifff?%m= +--t5J}tJri�-Wi1 iJ1t/iii::kf:l+f;;:fl c/o The Technologist Training Unit, Vocational Training Council 1f'1k�-Wil#,IRJlaHHi!i-WII iilRAfl. 16th Floor, VTC Tower, 27 Wood Road, Wanchai, Hong Kong. (MJx : ttPUilti��frl We are interested to participate in the EGTS. Please send us more details. *0�tiIW••��-tt�a•••·•*���M-�*0���- Name of company: Nature of business: 0P.]i;f.)JJ_ : ______�:m,11:W- : ------(IN BLOCK LETTER) (�ffliEfi§') Name of person to contact: Postion: lf,"fi*A : ______f�{ft : ______(IN BLOCK LETTER) ( � ffl iE tf) Address: Mhl:______ Telephone: ______ffi:i� : ______COVER STORY - TOURISM RecovHong fter the unprecedented boom in tourists arriving before the auspicious date of July 1, 1997, thereA was a massive drop in numbers of almost two million in the second half of 1997. Hong Kong then faced adverse publicity relating to the treatment of Japanese visitors and the outbreak of the bird flu virus. Tourist numbers have certainly taken a knock in 1997-98 and are now up only 0.2 per cent compared with the same post handover doldrums in 1997, according to Ms Amy Chan, Executive Director, Hong Kong Tourist Association. · "Of all our Asian markets, Mainland China and Taiwan were least affected by the economic turmoil. The biggest increase in arrivals for December 1998 is from the Thailand with a growth rate of 63 per cent compared to the same period in 1997. Other notable growth markets for tourist arrivals are Indonesia [47 .3 per cent] and Malaysia [29.3 per cent]," she said. The North Asian region produced the heaviest reversal of fortune. South Korea showed a decline of 49.8 per cent and Japan 30.9 per cent, in 1998 compared to 1997. "In retrospect we can see that the seeds of misfortune were sown in 1996, when visitor volumes rose more than 40 per cent 1- • - @l B s rw , tvJm nK � 1tt§ trJ *Yr U ;;ff:l:fil/!§:i�, 1.El.l9974B"Jr1U , JJR�A 1tt::k$m�1>ttm:200 ;i;A O vt&r , 7ffmm s * ��-��0����-��-¥ITT��ffl J�Htt±Ht, J!9wm�,w�tJ 0 :¼m nU1t� ir i\Ut* l�IUJit I! ±:R * � , :a1997 �984& , *ms"JnU1��iU:m: �,W��@lfi�ITT��Mffl�,��AJtt 11@1 ff-T0.2% 0 fttk !Jt : 1 tE2i)IHl:f Yr;;ff ii c:p , "P �:!:ill pg ffi�-����m��--�@ffl 0 *M 1998 4 12 )=jB"J1tt'¥ , *iltwmnK�- § ITTi� $1·•jc, �*4[P]MLJt T 63% 0 Jt:1t!!J�$1 ::f1%ITTJJK�3R1�:l:fil'f1tifp JE ( 47.3%) Jl�3R W.sJ! (29.3%) 0 J ffi Tourist numbers stabilised during 1998. ::j� Y)l·I.sJ! nHfB"J WJ m tj 1£. � �tJ> 0 tE 1998 �ntt�AIUUl.fJIJE'. 0 19984, miUPS*B"JnK�Jtt§�l997:rf:fr 12 The Bulletin Feburary 1999 ry still tentative for ong's tourist arrivals and Hong Kong became the leading It is not al I doom and gloom, recent In Hong Kong, the investment market outbound destination for Japanese travelers, figures do show signs of a slight recovery. and the development industry have little ahead of Hawaii for the first time. Both the Tourist arrivals in December last year experience in tourism projects. This lack Japanese travel trade and Hong Kong increased by,an encouraging 11.1 per cent of experience may dampen investment industry capitalised feverishly on market over the same month in 1997; total arrivals particularly during periods of relative interest in visiting the colonial territory and for the month were 936,914. capital scarcity, or when the cost of 1 collecting a passport 1 trnphy • Market Worldwide growth in tourism is borrowing is high. pressures prompted premium prices. expected to be sustained well into the next 11 Another important issue is poor Inevitably, neither the growth rate nor the century. en v-i r on men ta I cond ition s that w i 11 premium rates were sustainable beyond June Although it is uncertain as to whether eventually lead to disaster for the tourism 1997. The negative trend was sharpened by Hong Kong can recover its position as a sector by turning away potential visitors," she media reports of discriminatory pricing leading destination, a study by the World said. policies within the hotel industry," she said. Tourism Organisation (WTO) anticipates Hong Kong is facing challenges on two In October 1998 the guests staying the 1 .6 billion worldwide travellers and a fronts - the price competitiveness of the longest were from Indonesia (4.5 days) and tourist dollar value of some US$2,000 SAR compared to long,haul markets is the length of time they stayed further billion for the year 2020. gradually disappearing and Hong Kong is increased in 1998. The Japanese were the Amid all this predicted growth, the losing its price advantage over other cities shortest stayers averaging just 2.8 days. WTO expects that by 2020 China will in Asia. Total tourist spending is down by 29.7 become the top visitor destination With anticipated dramatic urban growth, per cent in January to September 1998. worldwide and Hong Kong will rank fifth it is important that tourism assets, such as Those from North Asia are still the biggest in the top ten visitor destinations with close the quality of air, water and landscape are spenders with the Canadians spending to 60 million visitors that year. protected. more than they did in 1997, as are visitors 11 Hong Kong is best positioned to The HKTA plans to develop North from the Middle East. capitalise on the growth of China tourism Lantau as a major tourist generator taking 11 Visitors from the Middle East are acting as a transportation hub to capture advantage of its close proximity to Chek spending more on shopping whilst tourists both in- and out-bound visitors," she said. Lap Kok. from the Nordic countries are increasing 11A shortage of investment capital is seen 11 We are actively exploring the their spending on entertainment, compared as a major barrier to growth in tourism possibility of developing a film city that will with 1997,U she said. throughout the region. Tourism as a sector of be the 'Universal Studio of the East' and a Indians have increased their spending economic activity is one that tends to generate theme park on Tsing Yi that will include on tours in 1998 while Australians and the relatively conservative returns over longer hotels, a golf course and resort," she said. Swiss spend the least on tours. periods despite the high risks," she said. In Tung Chung the HKTA is considering J1rnJcT 49.8% fo 30.9% 0 frtlrt�te : rn t��* , 1!iHJlJl:1�2t-mIi: JJ�� A a:xff:Jc , mi: E§ PJ i!�UffiHt 19 9 6 if ; � �,��A-Lft8��% ,�m��8- ��� , !fx.'J,ti;:zls:n��iw:±�s�:m)'�JJUHm s !\11� 0 nUtA.±tifrJ1H1I1%i-il!.ftJ't 'f:EtrlP.�Lm TA���ffi��-:k�--,��&�,S :zls:�fi'Ufo:zis:.tUtWA±1!ff�::k·fi/!{1:.2 ° rn ±��:>Kilt±�s!J&.J�MzMUt , ; PJ ¾ ,1997:¥6 ll:�j��z-,����-��-�-�-�T*• 1Ul$1Hl::zls:mmIJ;s*pq;(HE::f%+B, �45l: -�-,�m-&�-T�&-��fil 0 J *:¥ 10 J'l , fP�JJ��f:Em�Wiiw:5-\ (+ t'.']�4.sxJ , �m�r1ai�w1�. s :zis:.n�� 0 s��WiBH1aif!Uiw:Ji:N , +t'.'J.R�2.8 :x Tai 0, with its traditional character, is targeted as a tourist attraction. 3I9AF1ai , n���ifllJUMiT� 19981¥I *������@·tt��R��£&B*� 0 T 29. 7% 0 :l�2n���mJftt=¥{J}f't.1H1J� I iffi' ,El flJ 1999 1f2 ,El 13 COVER STORY - TOURISM 1 designating a site for an aquatic centre for 11 This recognition of tourism s water-based recreation. importance is a significant breakthrough for "There are also a number of valuable the industry/ she said. historic assets in Tung Chung New Town Central and Western has been selected such as the Tung Chung Battery and Hau as an area'where existing tourist attractions Wong Temple, 11 she said. might be proactively developed and The Mass Transit Railway Corporation marketed. A study into this possibility will has also been asked to spearhead the cable inventory all tourism resources, including car project linking Tung Chung with the attractions, events, faci I ities and other giant Buddha at Ngong Ping. unique characteristics of the district and will 11A cable car link from the airport to one analyse the potential for their enhancement. of the world1 s biggest Buddhas should The HKTA is also working on a Green prove a fascinating attraction/ she said. Guide to Hong Kong in the hope of Tai 0, close to Tung Chung, is one of attracting eco�tourists. 1 Hong Kong s few remaining unspoiled 11 The guide will include useful, fishing villages retaining its traditional scientifically-based but non-technical character and unique stilt houses. The information for visitors and local residents HKTA aims to sympathetically develop this interested in the natural environment/ she into a major tourist attraction. said. The Territorial Development Strategy The guide will encourage users to that was approved by the SAR Government appreciate and learn about the diversity and Green Guide planned to attract the in early 1998 recognises tourism as a sector richness of Hong Konts flora and fauna, Eco-tourist. 1 with long-term opportunities for private detailing many of Hong Kong s beautiful n& sector investment and job creation. trails. MHitiEJI� ��� llliwJ , isI�� � � � ■ tl9ntt$ 0 **n��z 1ff :botr::kffi, 9"1**�1¥J rlHUJiZJJ' i�m�XffiM, iUT 2020�,�llirm M0�,�amrn-�ffl��-ffi&®tt 0 J 1997 ��J:fl- 0 '!t&½�-���13'9*•��,wmZJJ'�u+ ttsm�ItuJrlMH�a�*J:milJ� �.f-i!J.: 1:W1997 �int,�Jrln��liUt **&�&�&�fflli,@�,*�Att� O !IDCJJ��5t�1JuM�El���:1Jffi±�:/JorlH!r, J :t.tlli, 6 000. ��: 1Jrl�ffi$a�fil�#�$fflA ff1998 � fP&JJ��±t:1JoTfi1tMr�,13'9 •••��: rwm&•aM,��?t ��,flffl1¥J� ■,�-����ffi�I 0 mw,wa�ffi�±*��-�um1¥JfflW mm��*&M1¥Jm�,•����1¥J�w Jilj O J �ffi,fflN��-ffi���� 0 filM1¥J �#Jl, ti1t±i�&El±i?7�&n�� 0 11t?7�, *t���!tMi0RJit�!l'.lli* -�D�'*m*����J:fl-8� 0 r•w�'Jt&,�•��¾��*•••� 'f.jjf,, �:ttJrlrmffi:x±t::kf;J, (u�±siz) 0 *�12,,Fj , Wf1U��·§�l997��±1 1¥J•::k$a 0 *&-�fflfiM1¥J�nx:M*, �tl'!t& : 1mtll!it,�tJ�tiWtttW• 11.1% , 4-AtU'$ 0 i�}j , :tf£m*�l¥JilA!t @lffi-IjZ-tl @JMUI , W Ml�0 J ::kl¥J1�1l , r�&,fuJi�nK��fil!0 J 'It&936 ,914 A 0 uwm,�•maffi�•�•�••� •M�llis"J::ka¾*m�•*�R�s"J MWffiM,½��mMm*��-�T 1¥JftA��-�tt&�§l¥J�9,��¾tE �ttz-,�ffiT*�l¥JM•���-�1¥J -tttf.ic0 -�-�ffiffl�nx:*��1¥Jffl�T,.Wl¥J J](__tm� 0 ttS�:f:¥�Jlt•'Jt&��l¥J*& wm��m�½����••�i¥J�• �-;f:�]!{ff; 0 !!.l� 0 •�,m�•�m•*�ztt,@tttw*• m� ,wm•�Moo�•;••m*� �RHt 19 98 1JHiH'r T 1 �mW�ffi #J!JlffiiJ!Ll, �� 16{1*§ ½Jtl¥Jn��� 2020 1¥J-�$8fflIB,ffi¾W.fill¥J§��$IB •J ,ff�T•m•1t&*mu•�m•*T 0 0 �wm, rMUJU!U�� 20,00011�:Jt �, wmef®rti�*¥J.1i1J:a<111� �Ms"J�•EltJtM�wr • 1� ili : !Jj 1 -100 ffi �,���tl'!t& : rmzxfin��•s"Jm� fi � ff l¥Jr,,, M ¾ ffl ±t ri§ tt��ff�,fi-�*m¾-::k�- o j �,�r,,�M-���3&� •SZJJ'.'Jt&,�W�ffl�l¥J•&�8� :f:wrmi¥Jn���ww±v m-tvM�Elm� 0 ��1i!WJM����M fe:�*ms-9*••0 �1¥J�fitt,•��ffiB1t�-::kfflfflilJ 1iJWJMH€ fm::ktJiffls"J a�ffi�����W*&M��l¥J�� jjjx$Jl�tttLl,r&W, 16' W: , � 5J"'tMt JJUllflJ l¥J JJffl 0 JJOi :f: � �UUt , 7](W - --�-�-�-ffi§��-ffi*,� § r.��w�m�n�•�• M P}BI*� •• :'iJtjffl±i1¥J )'j� � il1¥J��r,,,M0 �tJt: rt�*� �tz���'A'ffla 14 The Bulletin Feburary 1999 Government looks to long-term strategy to revive tourism By IAN K. PERKIN, Chief Economist Visitor Arrivals: Market Shares � � ,A):JA � : � ±t!3Ei � :;a- 1-$ he Hong Kong SAR Chief Executive 60 Mr Tung Chee Hwa's decision late last year to establish the position of 1995-Ann 1995 if:i:if CommissionerT of Tourism was a direct 1996-Ann 1996 if:i:if response to the various crises which had 50 I- I affected the industry from mid-1997. 1997-Hl 1997 _t*if The dramatic slump in visitor arrivals 1997-Ann 1997 if:i:if from previous record levels in the latter half - of 1997, the bird flu, red tides and negative 40 -I I 1998-lOm 1998 iflHfl!ftl ------international pub I icity (overdone in many cases) on the return of sovereignty, the new airport opening and other events would have all played their role. 30 But his decision was also probably inspired by a general and long-standing dissatisfaction within the broader travel and 20 tourism sector over the lack of any longer term strategic plan for the development of the economically important multi-billion dollar industry. 10 In the past, the local industry (including the Hong Kong Tourist Association) has been long on marketing and short on strategy, despite various consultants' reports 0 on how the industry might be enhanced and Am Eur Aus One China developed in the longer term. �m, �5:ltl �.m, China qi�*� The appointment of a Commissioner, :k3f5l&i *qi¥±&� with a broad industry brief, should at �miMEl'-J���h�,�-Aa$,�ffi 11�:tt�n&miA•,f!fti�r:psJ.J 27.1% 0 *�fla'-J�l9}-ilil&fiii,��,¥t�H��� rntt*m*�•EIM=iJITIE� (�™*) �-�-¥�h�V�,W■ ���-o fi!iit8�*1f:9�1c , *miMsJ.Jl&A�Y160 Jkh�fi��W-�¥�����k��* m¼m@•�-��•••�911f:r:pa f!Jt, &��Utut 29% 1'1'mi. l9} $ � -�� §', 1:E iE 00@] JJj 199 71f: Vt(*,*m•*�•§�•��,���� ��,J:J�iHiB�¾��5fll O r:ptJtH�mi�a'-J1i:Jlffttl ��--ffl��k'��-�A±ff-□- 0 6� s{J...t-$1f:, •Jlf.sJ.Jl&iiiirn 19971f:sJ.J -�*�39sfl ����,�ma'-J*�A-�M�*�a'-J �w,�••�•�'*m�*�*� Jtr�14o{tJt�2s6itJt,M�i�3s.6¾ 0 �fllJWft�, Ii!tt�rJrt!@ ,f.rrrt , ��1'J1t1:E@B ®Tffi::xsJ.J�f�,twt£:il�ti�sJ.J , �r:p� M�M�l&�,@MJlf.A±filffl�h� {U{J�ffil!i�(W$�f� , m@f!i�ill��fo' ����A•-�;1:f*Mm��a'-J�H• W,��m•ft�@Bmfa'-J*�A•*� 0 �51) ,LlAirtlt�•i'i"l���:ktuHJ 0 § r:p , 1:kr:p¥J (§:t!r:piJ�:tfil, i:r�A� ���m*•fi�,�k�-�-�--, m nK��ftis{Jttffetlill:k�±t� 0 t(*iM°=A�UH��s{Jntmir:p{,,�fll' N�IJ A±�Mu*••��mm���•a'-J•���,•���k'����-��� 199s 4�:il¾!Jr•*�ffi, *mmit�sJ.J ���tt�--���,WTI:�-�� 0 �A-� 19971f:jrijM�MT 8%; *11l�r:p mm*•Ll-t1lITT9Hill&:fuiS{Jfi�••,�•m�m*••--m&��* 11�:tfila'-Jn&�A-, �HIE.Hii:=tiJ�14% ,m irffll��Hi u�,��•*IV*D�*�,mili �mr�llm0 ��*'*mre-�•••��•** ��AV�*m*&Ma'-J�mM•,@-� 199s1f:, 1:kr:p¥J ��s{JaEJTI:ma 'L'250ItsJ.J$MlftUMJl:,M4-wmm��;fj 12,(*,it•� (§:ttwmi�mtii'"tE�) Rm M1lAar:p§���*•'�r:p�*z-� ilf!a'-J■W ( �PtEtiW�tJ:�H�*�-ijPl3 * ftJlg,µ!J�mt1Jk�M , 0 r:p���*�,��*m•��z�o-� i'i"l��l1E!W�* , T�r:p-f@il!N5I*� *411 JL1l.a'-J-1f:� , 1:kr:p*J ��*m sJ.J1 �l!HJ�J-� ■�ftfl,1�Hitl��5IA �,�y�m�-�t1ir,ffiM��M���-��--,���-�a'-]-��0 msJ.J*�•EIftimRAaa'-J so.6¾ , �¾r:p Alm-sJ.J�� 0 IiftfJH·IJ 1999 if.2 ftl 15 COVER STORY - TOURISM least offer the opportunity to rectify this As a result of the continued downturn For commercial airline pilots, Kai Tak situation. in arrivals (see accompanying table), total provided the mother of all landings in a Given the importance of the industry's revenues of the industry are estimated to world of more conventional airports; for revenue generating abilities to the local have tumbled $16 billion or almost 29 per visitors it became the subject of subsequent economy, its substantial role as an cent in the nine months to the end of dinner conversations the world over. employer and its contribution to services September last year. It is yet to be seen whether the export receipts, the Government is right to But this was at least a better result than dramatically new and expanded airport at be concerned about ensuring its longer the 35.6 per cent or $14 billion setback Chek Lap Kok - already effectively term viability and development. experienced in the six months to June when shortened to CLK in both local argot and The decline in the number of inbound revenues were down to $25.6 billion from international airline terminology - will Hong Kong visitors evident since the hand $39.8 billion in 1997. become a similar attraction to visitors. over ceremonies and the onset of the East Still, the industry needs to do a lot more Instead of the jumble of buildings that Asian financial crisis in mid-1997 if it is to recover fully its pre-hand-over is Kowloon City, the visitor to Hong Kong moderated somewhat in the second half of levels of activity. The appointment of a is now greeted by a more conventional last year, to the evident relief of all those Commissioner of Tourism will not help airport approach over the open sea with involved in the travel and tourism industry. unless there is some quick action to put in the green hillsides of the island of Lantau, But the overall figures disguised place a longer-term strategic plan for the to Hong Kong's west, as the backdrop. significant structural changes in the sources maintenance and expansion of the SAR's The airport design itself is spectacular of those visitors, in particular the continued role as a travel and tourism hub. (if somewhat on the huge side), but that's rise of the Mainland as a key visitor source about it. It is not the stuff of dinner party and the much increased share of "One New Airport reminiscences of past visitors. China" (Mainland, Taiwan, Macau) in the With last year's mid-year transfer of The move to the new airport does, overall number of visitor arrivals. its international airport to the new site perhaps, serve as a metaphor for the Latest figures for the 1998 calendar of Chek Lap Kok, 2 5 kilometres from state of the inbound industry in the post year, for example, show that overall the city centre, the Hong Kong SAR h and-over Hong Kong Special visitor arrivals were down eight per cent may well have gained one of the A'dm in istrative Region (SAR) of the on the same period of 1997. If, however, world's best (if initially trouble-prone) People's Republic of China. Something Mainland visitors are excluded from the airports. But it also lost one of its may be missing for tourists as a result numbers the decline was an even more greatest tourist attractions, the landing of the change, but what its ultimate substantial four per cent. at the old Kai Tak airport. impact wi II be is stiII in doubt. For the first time in 1998, the total The dramatic flight path over the city's Similarly, the return of sovereignty over share of visitors to Hong Kong coming crowded Kowloon Peninsula into the the former British colony to the People's from the "One China" sources, exceeded historic Kai Tak site is now gone forever. Republic of China on July 1, 1997 has resulted the 50 per cent level, with the Mainland With its spectacular views of - and into - in changed perceptions of Hong Kong, even providing the biggest share of all the high rise apartment blocks along the though there may have been little change in inbound arrivals at well over a quarter. route and dramatic right-hand 45 degree the reality of Hong Kong itself. In the 12 months to November, the "One turn and swoop onto the single runway Hong Kong is a different political entity, China" share of all visitors to Hong Kong 13, the entry to Kai Tak was an inevitable it flies a different flag and it is no longer that was 50.6 per cent and the Mainland's talking point for any first time visitor to oddity in the modern world, a colony, but it share alone was 27 .1 per cent. Hong Kong. remains Hong Kong nonetheless. It also �MAffiRffl�AR$�,�MB�• [P];tJU{g, &P{t¼m*��'.l'�'lf�BJ� 5Hll&� 0 -·��fi�W,��B��- �� �*, -t · -@aw1t>1�Ji!.t-J*m8{]ft�if &1¥�-�E· B�ffi�����- Mc!J� W�,��*•+1¥S�7*����.� �,*����m�#����rg�'tf�, m��UI.J�Ji) , f'.Mi�Mt:1•t (•�*� @a•,wm¾�[P]���••,M� -&rr199 5 ���*mii:::t�8{]>1�!li4;cfil* 45&, ��1i�M 13Jflt1IrHlitt'lf , J.lt� , t§ •��-�iffi,m�M¾mttiliJi!.��� 1,1 ;� ¾ , lli1f'lf?5t B ifYrr!J� 0 fi��-m��,@wmm�£wm,m @a��*c:q=:9=11fJ,*�Aa*M,@ 0 m��•-m���-���•w���ft 0 rt£tl.!Jfr 9=1 � �R§rt1 rHI r!ft� 89 m5 ��Zfili,Bif•*■ffi*&Mfi�if� 0 ��AAM�*m,��--•�M¾• �w,m�Mmffiffim*,•wru��m* ffl����*ffl;���*m,••��� )*},JJtt ffil�MmMB®7 �ft , {§.$'.l'lw$'.l', � ��, §! 1997c:q=:r1U��1¥��-c:q::, W�5i> ilifH{]�N!�w�,m�•���w�������• 0 *•��A•�-•�����ffl��-� �-MA±K��-�m�¼M�%* ffiM�woog•*��•�ffi••�� �1JU1M8�3:Jl�fp**fili��r"�- f P � 11 � rt1 #Jii:• �m , irt auu�u , tll1u, ��nK�8{]��6 '�J}Hil:§ w� O wm11&'31nR��tm:1J1oJrr? t:ir��*• �,f,J-*�nKm•��-:ft�•* o ��-�--�M�,M�Ji��M¾ ��������--�-M�*�ffi9=1W m@�ft PTfHtnWt!lt� 0 tr 5t , twm AR��rMe�#J,W¾*•w��•w x1tif$8�*t�ir? :�u,w�i��-11•� ���(��lRffi�l�rtJl����ifYr �w li�� 0 rtw, m:9-£5H-ig-m:at�8{] 89 ffllr!tmlli? a�,:ft�-��,£*m�m•sM*D :w;�WB 0 �*•wm•�R¾��tt�ffl*�� B*·t•&9=1E*��-lli����� 0 �-iJTMt�89tJUJ , "lei� ii� A��fl -����9=1�M?*Mir���rt1�R� 1l ' {g � itt � >'�' J!UJjlj •A1iB 7 ° t: � ir .JJK�89 rMr�J ]U'H!Uli? rlf•��m•,•#��fflW,�PTW*mffl=,*••@';��--}jt��o*• O ���-���filif���o�--� •]JK�-.fR�r [1997 4�:tnt/7a�mur ����s�w��• ,M•tt•�� t NA 0 #��-� t�-,���-����-ffl (•�m@a�0�•,�#��oo��) , m�,mtt�••K���A-t@a• ��•* 0 ���*•*mm-H¾*�� wm8{]»Km•@';�tem�� 0 J *••�m�-@•�-�'�*�m� ��:1[t_t�- '#JJIJ¾tttfi�*-��>'r�� ffi�,��*-�§����fflM&® o 1tllt1t* 0 �f�0#R�:IJ! ��,@-�irffl*••·•,fil*�� r!•@';n® , 16 The Bulletin Feburary 1999 maintains its key roles as an entry point for arrivals around the return of Hong Kong arrivals at a record 11.7 million and revenues the Mainland and as a regional hub. sovereignty to China mid-way through last of HK$84.5 billion (US$10.9 billion). year. As long as the money continued to In 1997, however, arrivals dropped Serious Questions roll in, there was an apparent reluctance to 11.1 per cent to just over 10.4 million and Certainly the downturn in the number recognise the changes that were occurring, total receipts were down 14.7 per cent to of visitor arrivals in the past year and a half but occurring they were. HK$72.09 billion (US$9.3 billion). (The has prompted serious questions about the And they are now having a tremendous expenditure figures are HK$82.5 billion present health and the future prospects of impact on the whole local industry as it and HK$70 billion respectively if spending the local tourist industry. grapples with the twin problems of defining by air crew and transit passengers is What makes Hong Kong attractive to its own image and coping with the East excluded.) visitors? Will it stay an international tourist Asian economic downturn. More importantly, the annual numbers magnet, a global shopper's paradise and a They include the dramatic alteration in for 1997 disguised the more dramatic touch of East-meets-West exotica, or will it the balance between long haul (global) and reversal that occurred mid-way through the become purely a business destination? short haul (regional) arrivals. In particular, year. Is its future merely as a stopover on the the increasing reliance on the nearby In the run-up to the return to Chinese way to the more diverse attractions of markets of Japan, Taiwan and, ultimately, sovereignty in the first half of 1997 the visitor Mainland China, or elsewhere in the East Mainland China itself. arrivals in Hong Kong actually increased 5.2 Asian region? Or perhaps its future is as a They include the narrowing of the tourist per cent to almost 5.71 million (up from 5.42 11domestic11 destination for visitors from the trade balance as outbound tourism has million in the record year of 1996). But in Mainland and from Taiwan? grown along with relative affluence to rival the final half of the year they dropped by Answers to all these questions and more the inbound market, at least in dollar terms. more than a quarter on the 1996 figures. are still being sought. It is the importance (Preliminary figures for 1997, for example, Arrivals in the second half were actually of the tourist industry to the new Hong Kong show that Hong Kong had a negative trade down 25.2 per cent (including arrivals from Special Administrative Region (SAR) that balance on tourism, although these numbers the Mainland) to just under 4.7 million makes the answers vital. Hong Kon g's are often subject to radical revision later.) compared with 6.28 million a year earlier. inbound tourism industry has long been one And they include the changes in the Excluding Mainland arrivals the fall was an of the pillars of strength of the local visitor arrival mix from the purely leisure even more dramatic 28.8 per cent to 3.62 economy, particularly in expanding its business, true Hong Kong tourism, to a million from 4.3 million. external trade in services. business and stopover mix. This relatively bleak picture continued All have been evident for some time� but into 1998, with the opening half-year Foreign Exchange have been masked by the annual increases numbers coming off extremely high visitor The annual influx of visitors, bringing with in overall numbers and revenues. It took the arrival levels ahead of the return of them their D-marks, Yen and dollars, has for downturn in arrivals and revenues following sovereignty. There was, however, some decades helped underpin the local economy the return of sovereignty last year, however, improvement apparent in the second half. and made the industry, at least for a year to clearly bring to the industry's attention Overall arrivals in the first six months (1996), the biggest foreign exchange earner the new structure and reality of the industry. were down 21 per cent to 4.51 million from for the former British territory. But in recent 5.71 million in the same period a year years things began to change for the industry. Record Year earlier. Excluding Mainland arrivals The evidence of change was clear even Hong Kong's tourism industry hit an all (themselves down 2.9 per cent for the six before the dramatic downturn in visitor time high in the calendar year 1996 with months), total arrivals were down a massive �...tff��Bilifil��•@m�tt�A 470� (-eIM'f'il�:tift;ot{�Altc) , -��$; �•�¾�lf'-m 0 *4T$4,i:p�*� $:w4� :lm ' 4tAljJ' ilOUff * ' lzsl 1lt if tJHJ �25.2%, ��1iz.Jij__t-4s%281-itAO �tt nk�A�m 1997 48"1230 MJI¥ 260 M, fr •-�-�*•��@M�,�m*�Aa �lf'iliJi�3!0U&��!t, �$U!U��� $1�13.1%, mf1F�JfilJJK�B"JAl'JJ=Wm8121'i r�•�A-�•�W�Htt���ffi* �, -�A-ffi430M.¥362M, r£x$ilt �,ff�14% ¥ 698 � 1w, �,�s"J%Jr%�0 � 28.8% 1998:i:J:::B"J*#JH\tM:f.\if��, t§�n�1997 0 � ��m� rc:i�5if� 1:J:::...t1U@M1ru���M•�¾*if�� 1998 4s"Jaf0fff1t, �rt���renu1 7-ls:m:0101�:M-19964�...tJJwt, �mnt{ 1m, 981:J:::r$4, 'tlt£BifYri:!Jc� 0 •�*�½•��•2��•-•�¼m@ �A•� 1,110 •, ��� 845 ftmx (109 199s4...t$4, ¥Urttn&�ttc§m�...t- Mf.El.il=$ 1l�xl 0 4fPJM�571 ;t;ri121%¥451 •; �tt� ����Mma�••�ll*�Aa• 1997 4, *mAarix11.1% , •�A lf' ■ *��*m*���(��*�Attc� �••r�,@��*�*•�ljj\���@ $:1m�:o�1 0401-it, rm�4�Aljj\ri�14.7%� tt$4r£�T2.9%l , ,t\!l*mA•�um�...t M�Y:ff!UJ�11 , � if' rfl·IU iX 1k ::l t � �friJR -& m Ji , O 0 no 1! 9 ooo .-mx(931t�xl [�tt� -4s"J449 ••¥ 333 � , i1�:m�25.9% z :fttt: , �o �fiA�&�m*��m•��ft�•*m �-!-1211ID}j, ::lt21J,M ( S 7-ls:liz..ftil) s"J n��ft1996& 19974�W1:1taf0 "-�,1�s25 �f�j:�-&B"J, xif;/JD�*fQfJrWMmffi *mAttcr�T34.8% , •1¥j2B"Jffe,UT£J 11»100 f!Ylx O J ffl���*�*��•@ffl�rffi�,ffi�� 20.2% , m:tift*mnt{�ttc§�� , 11ut¾§ 0 �ffifflHtt�¾•*m*��A$:� nk�iltuili :i:1JJ¾� 1J\ ,!-4i:pg,���M- �Mliz..�M��M 1997 :i:J:::lf'�?t�i, 0 -!-4�4, *mnt{�•§ r&x8% � 957 J& 0 -t · -@M1ru( ep 1997 4...t1Ul , *Yl 1-it A199 ( 7 4fPJ AA , *itt#JH"J nk� Attc� .tit5'� , iXrHI • 1F YJ+lliz.. if' Jlt *� �4 � :Ilt�s"J'.l�$:f:t!lli571 1fiA, �19961:J:::§r 1 0411til , &J$;��fQ�, m¾m:o�19974 nK�AttcZJJ'�YT 11.5% , ;tti:p , ii■ i�� 0 , 0 �q� s"J542 J-itAj:�JmT 5.2% PJ¾ , JUT fPJ r$ff::fit{�Attc:k•, � 19984fPJAAMH�T s"J*ma§£:k$U��27 °;� 4r1U, :ffH$:fBflrti996:i:J:::s"Jr£kTlm:fr �fa:s"Jrt��* 0 fPJAA , ::l��fjHs"J*m1Jt{ �$:fljj\1�� z-�...t 0 rtoo , 98 4r1U*miK�AtUJ$U-Jz: 1.4%; fl��-�M�tb, {g*ms"J��A 0 0 1 9 9 1 4 r* 4 , ¥Ll m nt{� s"JA•� JE.. ••ljj\ifffi��lzsl*ZM ��*�A$:• awr�T 3.4% Iifi'jJ:H-IJ 1999 � 2 .FI 17 COVER STORY -TOURISM 25.9 per cent at 3.33 million compared with But arrivals from Europe, Africa and the were down 28.8 per cent at $39.4 billion, 4.49 million a year earlier. Middle East were also down 11.5 per cent compared with $55.4 billion in the same The only two significant source in the 12 months, with one country in Europe period of 1997. countries to record increases were the still showing a far bigger decline (G_frmany, Tougher economic times have meant relatively small markets of Canada and down 27 per cent). that spending by visitors from every corner New Zealand. North American arrivals were also of the globe was down for the 11 months, In the full year, however, total arrivals down 1 .4 per cent for the period, with both in terms of overall spending and on a were off by a far more modest eight per cent arrivals from the USA alone down 3.4 per per capita basis. to 9.57 million visitors (compared with 10.41 cent, despite its buoyant economy. The decline in overall spending ranged million in the same period of 1997). This Still, all the figures forthe 12 months did from a relatively modest 17.5 per cent drop partly reflected the much lower base of show far more modest drops than were for visitors from North America to 52.2 per comparison in the final six months of the apparent in the opening six months of the cent for North Asia and 49.5 per cent for year. year (from the high base in 1997), giving hope South East Asia. Even Mainland spending But a lot of the cushion came from a 13.1 that the indus�ry had at least turned the corner. dropped 11 .2 per cent. per cent increase in arrivals from the But the question still worth asking is On a per capita basis, overall spending Mainland (up to 2.6 million from 2.3 million what would happen to the local industry - dropped 19.9 per cent. Per capita spending in 1997), with non-Mainland arrivals being already affected by the crises in south east declines ranged from 12.6 per cent for down a far more substantial 14 per cent (to and north east Asia - if there were also visitors from North America to 25.6 per cent 6.98 million from 8.12 million). economic slowdowns in the US, Europe forAustralia and New Zealand and 29.9 per and, importantly these days, in China? cent for South East Asia. Mainland per capita Asian Crisis While arrivals have been down, revenue spending was off 20.9 per cent. With a full year's figures now available has declined even further because those With the local tourist industry having for 1998, it is also clear that the East Asian visitors that are coming are spending less and emerged from its Summer low season, financial-cum-economic crisis cannot be the local travel and tourism industry has cut however, there are some signs that the blamed for the entire downturn in the prices to better keep the arrival numbers up. decline in visitor arrivals and revenue figures industry, nor can the reversion of sovereignty Total tourism receipts for the first half nave stabilised somewhat. over Hong Kong to China. of the year were down an estimated 35.6 But the 1998 arrivals and revenue figures Although the numbers coming from the per cent, or HK$14.2 billion to HK$25.6 will still be substantially down on their 1997 crisis-affected short-haul, regional markets billion from HK$39.8 billion a year earlier. levels and well below the record-breaking have declined substantially, there also There was a slight improvement in the year in 1996. Moreover, the longer-term appears to have been some sort of post picture forthe nine months to September, but questions facing the local travel and tourism hand-over effect in other source markets, not much. Receipts for the first three quarters industry need to be addressed. ■ most importantly the long haul markets of Europe and North America. Visitor Arrivals (by Country of Residence) and Tourism Industry Receipts 1997-98 Both North Asia Uapan and Korea), down 34.8 per cent forthe 12 months, and south east 1997-1998 ¥1tli��AjJA� (t�J§:11±tHtjf) &M01Ht�4Ha Asia, down 20.2 per cent; have seen dramatic Statistics 1997 H1 1997 H2 1997 Total 1998 H1 1998 (to Nov) declines and are most obviously tied to the t,Hi J:'1'.� �it (fix?€11 Jl.Lt) - - T'J!.ljc -- J:.-'¥��- currency, financial and economic turmoil in Total Arrivals 5,709,157 4,697,104 10,406.261 4,512,567 8,637,797 the region since the middle of last year. �.,A.ljt),J:!� (+5.2) (·25.2) (·11.1) (-21.0) (-9.7) Total Avenue ($bill) 39.8 30.1 69.9 25.6 39.4 (Sept) = ! l&M. (-35.6) (·28.8) tt?!PF5¥0 m ,@,i'§•1t ili , {13J@. *12100 fal The Americas 558,796 484,991 1,043,787 499,395 939,041 �-*■�•*4r¥4���B�k¥4 �y}H (+14.8) (·0.3) (+7.3) (·10.6} (-2.6) Europe, Africa, Middle East 679,773 496,414 1,176,187 515,067 .961,939 -� (���¾��974k���-*� �jffl,1�;:ftt, q:,]l'l (+3.3) (-20.0) (-8.0) (-24.2) (·12.8) :fr, � 98 4[P]WJ1Rd�T��s"Jtt�¥rfn Australia, New Zealand, Pacific 193,443 161,287 354,730 166,868 304,766 �4-��A±t��tJr$� �*' :/!:'!';$� (-1.4) (-13.1) (-7.1) (-13.7) (-6.9) North Asia 1,055,267 671,259 1,726,526 504,843 1,013,701 ffiffl�m�¾'*���B����� :lt.mJti (-13.3) (-57.0) (-37.9) (·52.2) (-37.3) MMa�•'�*•·�&� ■ �ffllli4B South and South East Asia 849,161 649,304 1,498,465 570,344 1,035,047 1¥l�.&.ll'li$i� (+9.4) (·22.7) (-7.3) (-32.8} (·24.3) ••��m•�tem•�•m,mM,fflN One China 2,372,717 2,233,849 4,606,566 2,256,050 4,383,303 #�fr�O{iiJ? .:k'1'1i¥!11!� (+13.5) (·13.5) (·1.4) (-4.9) (+4.7) *m��A•*•'��*&A±�ffl - Mainland 1,221,110 1,076,018 2,297,128 1,186,074 2,342,139 -'1'11.:k\!i -��-.�����A�N�r,�T� (+8.9) (-9.6) (·0.6) (·2.9) (+13.3} -Taiwan 879,654 902,926 1,782,580 864,466 1,646,738 0 '31:f5��, ��A±%H5}�1JHiH* -�� (+22.1) (·18.0) (·2.1) (-1.7} (+0.6) *�k¥4•�-���Amtt�tik - Macau 271,953 254,905 526,858 205,510 394,426 -�r, (+9.2) (·12.9) (·2.7) (-24.4) (·18.3) �4� 398itmjcr&J142ftjc� 2s6f'.fjc , Arrivals (excluding Mainland) 4,488,047 3,621,086 8,109,133 3,326,493 6,295,658 ��u� 35.6% AJlJ..11( Cf-!i!}i!ip;i!lllJ..±) (+4.3} (-28.8) (·13.7) (·25.9) (-16.0) 9 fal , � ·�Ntttf�itJ?!{� �� *� Note: Figures in Brackets() represent percentage change on a ear earlier. N , 1J=l.*�lfflE O 1f*�®:A� 394{fjc, y 0 � 1997 4[P]AAs"J 554{ljcr/iJT 28.8% 0 a:��() ���*���-�mtt����s�$ ;fl:#Jrr�{ffi�r, �:f>J 18 The Bulletin Febu rary 1 999 I � "'!!!!Ii�--...-WID . 1 =- LIN . =-. the - ·te lf/ww =---� ©©□® I'■. , .. WORLD-WIDE BUSINESS LINKS �.Edit f' C A S C£: MemberaOnly Momberahlp Oinacto,y Contact Ua 'P X. WORLD-WIDE BUSINESS LINKS KOH Cl:11 CE Main Menu M�ml>•�Only M0mbarship Directory ContactUs 'f i:.. Useful Web Sites In China & Taiwan 98 Technology ExportFair Of China On_line Technology Export Fair of China is the largest data base on internet for chinese transferable technology. It is sponsored by the Ministry ofForeign Trade and Economic Cooperation (M.Of'TEC)-ofP.R:China in an effort to.cope with the rapid development of International Electronic Commerce and enhance China's economic _and technologi"cal exchange ..,, with the rest of the world. Over 3,500 items of information from more than 700 enterprises nationwi.de have been published on the Website. http:/h-w,w. tachf�ir.com. en ROUNDTABLE EU helpful to Asian importers .., ny proposal that Asia can export an increase in imports. There has been The US does not have this policy itself out of recession by trading much lobbying from the steel industry and because it is not enforced by WTO, so in A with the European Union (EU), must not just on anti-dumping measures but also this respect, the EU has gone further. consider their anti-dumping legislation and on import restraints. Another area the EU has gone further protectionist sentiment in future EU trade 11We are following this closely because than the WTO requirements is in their anti policy, according to Ms Nancy Kontou. it will have an impact on the EU in terms of dumping measures. Ms Kontou a Member of the Cabinet, diversion of trade. However, we are 11We have a rule called the lesser duty European Commission, was speaking at a determined to pursue liberalisation despite rule. This means when we take into 1 Roundtable at the Chamber on January 12. what happeris, 11 she said. account th�'.knti-dumping duty we don t 110ne question that a lot of companies Ms Kontou said the next landmark event just estimate the anti-dumping margin we ask me these days is whether the Asian in the trade world will be the Millennium also consider how much injury you have financial crisis will have an impact on the Round - the new round of multilateral trade caused to industry. The lowest of these trade policy of the EU and business Asia negotiations within the World Trade figures will be the anti-dumping duty," she can do in Europe. Certainly there· is an Organisation (WTO). said. increase in imports from Asia but the 11We won't just be negotiating tariffs but This is of advantage to the exporting answer is simple, nothing will alter the also new issues such as trade and countries because injury to industry is often direction of the EU trade policy towards competition, trade and the environment lower than the dumping margin. liberalisation," she said. and government procurement," she said. 11 ln the US you don't have the lesser duty 11The impact of the financial crisis has As far as Hong Kong is concerned there r�le and dumping margins are very high," been quite significant in terms of the trade has only been one anti-dumping case with she said. patterns we have seen in 1998. Imports the EU over microdisks. Measures were 11There are some changes that we have have increased by 20 per cent and average imposed in 1994 and will expire this year. made to our legislation last year that could exports have dropped by more than 30 per 11 China has more cases. Both Sir Leon be of interest to Hong Kong, particularly cent," she said. Brittan [head of the Cabinet] and I are not because most industries here have interests There have also been sectors like steel enthusiastic supporters of anti-dumping, but in Mainland China. where the shift in the trade balance has it is in our legislation and must be upheld," 11 What we saw is that companies been even more marked. she said. operating in China were very different in 11lndustry comes to our door everyday and The Commission has been trying to the way they conducted business there. says 'this is an unbearable situation, we cannot apply anti-dumping measures in a So it would be unfair to consider everyone survive'. The answer we give ..,.although it is reasonabte way and introduce practices operating in China as operating under the difficult - is that we want to continue that will take into consideration the interests same conditions. Until recently we had liberalisation efforts, provided of course the of importers and consumers. no choice but to calculate dumping by necessary restructuring is taking place in 11 Even if you have dumping that causes taking the normal value of the product countries where it is needed and that anti injury to EU industry we may not take anti (the price you sell in China) and compare dumping rules are not infringed," she said. dumping measures if you show that damage that to the export price to the EU. The The US has also been subject to the will be caused to consumers and end-user difference would be the dumping same pressures from their industry due to industries due to higher prices," she said. margin," she said. ;n;r)·l·l ]7iijw � � :r'Llfil s{J I!) :ljp=p ' :fJDsU� :li!B:i:$ , •£ § Ei31l�aMJ2J,��:1r:HJ #¾&M��••��,m��a¥�� �a1Hlij$M,5Jt1U�ls{J •£11* , PT¾ , �H�o s{J� * ■ #JHilJ-rB!x: ¥ 0 J ft�Z$,�ffi�TM.Ms{J&MM� rtt�1Mft199s c:¥-s{Jfi�, �iime �� IP]tl!EJAp :!:�:1Jorm�¥Ll � pgI*:W ffl,����pgs{J•£��I�•�� �-T·�s{J-£ffi� 0 -�s{JmP:l:_l 8{]�� 0 Ma*fi'il�m��m�,�{§.I **aM8{]•£�ffi 0 aMa���•■ fr T 2 o % , Tm tll P :I: ffe.USf- :f:1] � I?:J. T *•�&M��ffi,]!�*•�mPff 0 f,,i11)$;� Nancy Kontou 3Z:±ftJJ\�Lf� 30% J iu • _t�t!:LUf;@:� 0 ft��WJJIJ (�PffiiOll m!., •£�ff:§: fitBf_ll} : r :f!G1r�wtu1_t��•� s{J�� , IE1 fitBf_ll} : 1filM, :;;fy0RJ fi'iJ� f.,Ht , � ]!�SJHI �m•*•*•£ff�,�•Mmm�•, ��•m••��--Ms{J•£�ffiffi� :li!B*i.K: 1I*WA±�ffi$*1Uff: {§.• �P wa 1oJ, llG1r� �;@:.1-'r • §£ Ei31l O J �17iijWfta�ff17iijs{J■• 0 ��-tta� r�mMN:;;f-aJ�¾T,��•ft•�� mw•£m•*��ffi-•8{]$W•£ s{J�:l:s{J��l3/r_tft-, {f:!.aM•£§ Ei31l ff O j llG1rHUt J2J, ,1rcii ' {§.1JHJHP• @] •�--r�Mc:¥-@l�J '�*,BJt�•£w s{J�ffi¾��s{J O J �: -M�¥Jf.1/UIUHr•£§ Ei31l�ffi, 1t s{J-:k�$ 0 20 The Bulletin February 1999 However, the Mainland is not a market *iliro?. : 1fF.f Ml , ft 11'� � 1*-®-r,Ht ImfU"� ,.ft�--,��%ffi�--��� economy so this value would not take into -����•• account costs of production. �,£-®-M�j{�W�*-H�Wffl�, a,�12J-nm�m� O 1u,rn1J�= � 0 !ID( 11 S0 we had to use a third country as an 12JR � m fJr !il � J 1tf4-J&, JJ�¾�%fet 1ULlili.AA, analogue. That is a country that has roughly ��1-M�&Mffl��,Ri-mw M �lj � 1tB� • JUf rt;ii �et iE � M � ( &P the same economic conditions as the ¼M�N•*����¾tg•R 0 fflm ��il��fflMl �--��:±10M,12J Mainland - we used their prices and costs 0 � i� O of production to calculate the dumping,'1 ffi'lif!!:�1994 '¥�1'r, M�M-4-'¥WHl ffi at* � tJi 1tifffi 1IHi J she said. �t�:±1: 1W�il�Net&fji�1m�• �rm,��*��#Wfiffi�•�,� 0 0 If a company can show that the conditions � �mfflfi±( ■ ����)ffift�*� !ltffl1reJ1Ui�:J:E1:.ii�*filMtE� in which they operate on the Mainland are �&®m�m,m���¾•M�m�, �ro?.: 1� !lt, @cM£,JJil2Ji��,liY5tW very similar to normal market conditions then EJr12) £, �Ji�fi O J ����ffl��ffi=� ���fl,��· an analogous country is not used. -��ft-mhl2J�����-fi&M ffi��-�R1:.ii�*'�•tt•#�� 11This is important because if we take :: 0 nm: , Jdt R �- companies 1 data operating in China there t� m .w 1£'JI 'Wtlff.f , m :±1 1 nffiffi J won 1 t be an anti-dumping duty at the end ¥� • * Bt liJ ii ��•®•�0ffim�m�,�%ffitE of the day or it will be very low/ she said. �iJt: 1 &Pfffji� n§j)Jffl� T @cMI � ����--�*#W-ttffi��ili.,. But the change that has been made will W���,R�#$A��-�'�®ffl Mf!�itl2Jffi=il�t�• not always guarantee that your dumping ���12Jft�M:±lffl,-@-tiM��ffi:l* *ilit�:±1 : 1ffl-li1i+*£�, �RM margin will be lower. �rt;� ■ 11 lf it happens that the resu It is less R-��ffl·ii��I�ffi�ffl�,ft� %ffl�•-••*•,&®ffl favourable for a company than if we used an ff�-�f)tfi& fji�ffi'Jitli; O J mtJi{Iit**�Y, •�-tt�Tffl1i analogue third country we can not do ���m�*12Jk•��tt�a•,� fJt. 0 J anything about it - it is a risk that you take/ ��.w#filHfiBU�� 0 1£ffl�ffi,. -�¾,ffl�GM�-��MfflfflMfil 0 she said. *mm: Ms Kontou. stressed that companies M·��5Eiw-z:t-o 1�12Jffi=�fHt•st1j:1t,if j{ operating on the Mainland must apply for JJ 5'� IID(M, Bt & fffii�m'nti! illftfil #llB �%ffi��•RM�-��h,1fN%ffi 0 ;kJ. )Ml O market economy treatment - it is not the et �• 1i £, ;Jiit ff\ Ii! J Commission1 s job to decide whether this is *U�:±1: 1@cM�J:IHt¾ r•1uJt �-�,tf�-��--�%ffi�ffl� relevant. ffiU &P , tEIii� & 1U� fJt.� , � 1t[1ti it ii RM$� ,�Tffi-•M��*� 0 R� "We have market economy claim forms which are sent to companies that are under •�•�•m,£�••®•m••�• �ftitT-®-���%ffi���N$�¾� 0 @:�a investigation. There are administrative w•��*-�'.w*��*�•m& J deadlines and this form must be submitted m•��tin:±1���,��•w�® *iliro?.: 1@cMB:te:ffi�i�M$$[Hf�i� within 21 days of the start of the ffln§j)JEJr��ffl�-tt•��®ffl�- 0 Efr1f�-��%ffi 0 �MU�TM�$ffl investigation," she said. *ilif� : 1 � il ti � 1f1'r U3t iii ffl1'1U , BAA,*��ffl�-���M21x�x @] 0 This new legislation came into force in _§_ O July 1998; so far there have been no im f�i��fj�-�jg J J 7 ° � companies that have asked for market 1�'¥,@cM$*�M-�GU,ffi� ffiJJUM!f9°tl� 1998 '¥ Ji 1:.�1 economy treatment in cases involving the ti¼Mft���,��¼M*$*fi•� �,�]k�-���-��'�*�%� 0 Mainland. ■ W�tmift1JiiN1i �>J<:�7mti•�1�� ■ Expanding your customer base? � This can be risky with new buyers in today's Hermes" 7 business environment. Call us now for confidential discussions at : What happens when your Hermes Credit Underwriters Hong Kong Ltd. invoices aren't paid? 1i: 1r nf ffl 1�d!Hi �-ff�I! 0 oJ 20/F Ruttonjee House, 11 Dudde/1Street, Central, Hong Kong. ff� rp III�JJl ttf 11tJi Y120 1$ Credit Insurance 'flf"#ff Tel : 2867 0061 can offer the solution to balance risk against W JtFax : 2869 8655 !filJ e-mail : [email protected] reward. 'flf -r 1fi I]ffiJHIJ 1999 if 2 � 21 ROUNDTABLE Regaining control over costs ne lesson from the recessions in If costs are six times greater than net 11As a result you add extra people and very 0 Europe is that every company profit and a reduction in costs by 15 per quickly any attempts to save money have should have a plan to cut costs, even cent can be made, profitability can increase been dissipated. You need to tackle if they don1 t want to implement it by 90 per cent - almost doubling profit. overheads with something that is slightiy more immediately, according to Mr Alan 11 lt does not take much in many analytical, slightly more comprehensive and Hetherington, Senior Consultant at Hodgson businesses to double the bottom line profit," effective," he said. lmpey Cheng Consultants. Mr Hetherington he said. There are three levels of approach for was speaking at a Roundtable on January 13. Unlike manufacturing costs, with opportunities to cut overhead costs. 11One of the costs that is significant in overheads, one dollar saved is one dollar on The first, efficiency improvement, is any business is overhead costs - these are the bottom line- it is a dollar for dollar switch. about doing better what you do - this may all the costs other than direct manufacturing There are traditional ways that people involve using more computers. or production labour, utilities, packaging use to tackle overheads. 11Most of the people are pretty good at and materials. Good cost reduction 11 Time after time sophisticated this - they employ good managers and challenges the definition of fixed versus companies tackle overheads with install PCs," he said. variable costs,U he said. methodologies that are very crude. Usually The second approach is determining the People-costs are by far the highest of they take an across the board approach - added value of job activity - what adds discretionary costs and account for at least cutting 10 per cent of every department or dollars to net profit. 65 per cent. they reduce training, entertaining, 11When we talk about activities we are 11Many businesses think you can make marketing and consultancy - easier things looking at people and what they do. But substantial savings by buying a cheaper sort to grapple with," he said. we are not looking at overall jobs - it is of paper clip - sadly you will not save But there are many problems associated very easy to class people as the position much. If you are thinking of doing anything with these crude methods - they are very they represent or the report they produce. meaningful with costs, you must address arbitrary and they are seen by those who We have to look at the whole picture, the sensitive area of people," he said. work in the business - especially the because they might be a key person in your Mr Hetherington said it is sensible to managers - to be very arbitrary. organisation. However, the thing they do find out what the options are and then think 11 Using these methods you run the risk that is vital may only take part of their time, about implementing them. of throwing the baby out of the bath.water - so you should be interested in what they 11Direct manufacturing costs are relatively you might be cutting a department that in a do the rest of the time," he said. straightforward to address because we can recession you should be increasing/ he said. The third level of opportunity is correlate them to volume. Overheads are If a business decides to freeze recruitment reengineering. This means that you need more insidious and it is more difficult to it does nothing fundamental about the to stand back from a business, forget the analyse the value of them," he said. workload of a particular department - and traditional structures and reevaluate how a Overheads have a very significant so after a month the supervisor comes and business can work more efficiently. impact on profits and loss account. says they are unable to cope. 11You need to look at the basic processes •�•m: rma�$,ffi���,� f.?J�@lttEttfilfF.1itl1ts"Jff�F�, WmfcJ�IE!1lt tt���� O J 0RJ�fk:���t£�� , 1!i1":bom�@ff� 'H. ?fl·l�$: ttill1��0, 4if*0RJ W#Wtt�ffi) Wftffl�ffi��I�•�§ r�s"JI11=:i:, �*, -1iJHi, 'lrm±ff1I !3 ���� � 0 0 'IM:-�1u-��U�m1-Js:EG1r�, �Pft0RJilfz 0\.I , % nitI 11= _tE8 0\.l�H,'R irt!i!:M:A��� *wfUPfF.1J1Hr ' tMl*ffi#)WJ� 0 tE1 }=] 13 It-I§ : 1 �mJt�, � 22 The Bulletin February 1999 involved. If you forget the functional boundaries and cluster the overhead costs closer to the process you can not only make Hong Kong to host regional CIO Forum considerable savings, but improve the flow of the process," he said. n March 24-25, 1999, organisation, and the value of information The way that a business uses people is Business Week Magazine and is realised in projecting, forecasting, pattern critical. 0 the Hong Kong General studies, consumer relations and company 11 You may be able to use a person in Chamber of Commerce will host the valuation, the position of CIO is growing two departments. But this does not normally Chief Information Officers Forum, at the beyond the ranks of the multinational happen because department one is under Grand Hyatt Hotel in Hong Kong_ The corporation. director number one and department two CIO Forum, entitled Leading Change: Some key discussion topics are: is under a sepa_rate director. And, however Business Alignment Through Information • Information Technology: Gaining good the directors- were in doing cost Technology discusses strategic the Boardroom reduction in their own department they are informatio11 technology issues that are • Aligning Business Strategy with an not empowered enough to look over the 1 critical in today s corporation in Asia. The IT Strategy boundaries into someone else 1 s Forum follows the inaugural Asian CIO • Year 2000 Compliance or Bust department/' he said. Forum which was held in Singapore in • Enterprise Architecture When analysing professionals, while September 1998. Up to 200 delegates • Initiatives in Virtual Private Networks part of the day they are doing their will participate in a series of plenary • Optimising IT Assets professional work, which justifies their sessions, breakout workshops, social • Locating and Retaining Technology salaries; part of the day is spent doing more events and dinners, in an atmosphere of Employees trivial work - which could be done by discussion and audience interactivity, in Information Technology in a someone on half their salary. • what is Hong Kong 1 s most important Finance Environment 11 Cost reduction is sometimes Hong Kong 1s IT Initiatives and Hong rebalancing professionals, where using two strategic IT event. The conference _is also • Kong 1 professionals can be replaced with one developed in association with the Hong s Role in the Region professional and a support person. It looks Kong Productivity Cou·nci I and is • Redefining Supply-C hain too simple but, believe me, I can quote p rodu c e d by H o n g Ko n g based_ Management many examples/ he said. dnmStrategies. • Vendors Assessment and Another aspect that can be used to cut Outsourcing costs is looking at business peaks and troughs. What is a CIO? Hear from leading CIOs and IT "Most of the businesses that l go into l The CIO is a facilitator of information practitioners from Hong Kong Telecom, find that people are manning to the peak. distribution and business communication Federal Express, AT & T, ORIGIN, Gartner But this is usually expensive - manning to processes. The CIO understands the new Group and others. the trough is better. role of managing the asset of organisational For more information regarding the CID 11One way of doing this is to move the information and understanding how that Forum, the most important executive level peak- as they are usually related to internal information can give business a IT event in Hong Kong in 1999, please deadlines rather than customers - and cornpetitive advantage in a. market contact Ms Carmen Ho/jenny Wong at tel: realigning this can be cheaper/ he said. ■ environment. As information becomes 2823 1291/2823 1268, fax:2527 0380 or more accessible to all levels of an email:[email protected]. • ���-�'�@�**���*'��& cgI�tUi O J 0� m As"JnM=-t5tli:� 12),� 1tM� t±l : 1-f[a)�raJ m"1[a)'lrBP�I ffpaf*�tiJ) WiH�ti,i�paf•��Jt 19991¥3):j 12),�ff�¾*rq,•m•ammm��� �o �¾,ffi�--��·�� 0��$ � 24 � 2s {ft O P� � �.:E.�� � ft - $ P� G Iii --'-.:E.��� sfeH}¥ittt�?WJSil-it I JHfUl!l •••J ,••�•�1*W��:•mw ••.:t�mfu&�Ur • ; � MutB P� .:t �u� 1EJijiUf 1m, 1ruum �u 0 �'irBP� rqS9 � x , BP�ii�P"'��-=g:B P5 89 tt�M�-�*�MJ -�,��tt*� * Rlflf-Hi: * li*ITT ¥ 0 MMum���¾*s"Jm�•mwtt�&,@ * paf�ffiwtWRllH-4ttffiwt J 0 $*A�re$5t��ffl*�•filrq�$ ���$�wo�tt*#� ·••w�m * =-f-1¥til1izr.,i&s"Jte;8W��ffe: *ttI�,�-�-ffl�-�ftM,*¾� �a••-•�I�w-��m�:&��� * ¾**rtw•ntr-4tt M#�,@��tttt�St±l$5t��,*� -�$�§,-�$��-�s"JMMu•m * Jttl5flffl�,Hls9�Ut mw•n,oom�I��-�12),�li!��• r,W��ffl�� 0 *1¥�):j,��Hs"J * ±�sgi•ntr11-tt•£ :&1ili1P�-*s9�I�Jf 1•m••••J������•fi,�� * �Uf0J■W2:&� IU4ttA_:;1- �t��: 1li:fFJrt.,JUc$*AMs"JI�fil * 0 B¾ffi=@,fil¾�mftffl�s"J-ffiWtt• JJJft�ww•mr4tt �m�M�* ���fflmm•*AMs"J, $ 0 0 .ali!�-�£n�m�mm,�lil� *�¥is"J.ffiWtt§�;&��rq�PJB �12J,E!Jt��-*A;J;J;¥umm��-� dnmStrategies � O * mfflmM=fil�*M¥T,@fflffi��· m JOtlu {!t���J_ts9fFMi:� 0 * ��JIJ�$1[a)1§ff�!i� J Jfn!-¥1t:&>Hi-I� l r�ma,�J ��Pi? �¥i�lfl ' IHB tR� ' AT&T �-oo�m���*s"1n�£�f, 0 �* ORIGIN ' Gartner Group 11W1ff:1t ,MiWcA� iUflt@aS9 I 1t¾11.tm•lR�iftli :& � �¾*sf.)0 '.i:HlU� 1miJ?.: r�Mtl�s90� q:; , *$*m� * 11 lfl ; 1m &,�Jl: 1E'- :½ 7 ��ffi 1UJr Pl Bs9 Jf a:&•mtttt■�•••ff�$ 1Wffi �*�-s"J��-�A�,�¾m�T� ff,¾ff�•wm••il-�RmM&,� •••aJ£*1¥��••m��•mw l l O *,.,__, ·��, ■�A��•�*��s"J��- 0 ��m�•mm�*•�m•�s"J•*� tt•• !?£t£@fil ::iG�ii� j£ 0 • ��-fflSMS����--rq�ffl i!itfD#ftf, lf!Jli$fiif lHJi!itiVJ,�/J,f!JJ. !; * :ri1f1 ifi , ¾ -f[a! ffBAA J/Jp#.j: t!Uf§ : 2823 1291 , 282_3 1268 {$ M tUi0 R rq m�,oo•m�•�-m�-%•5t� �,ffi#��M���M R�•�■mM Jr; :2527 0380 'l/il/S : csl@hkg9c.;_rg.hk • 0 ��Nffiffi0ffl�Mnooms••�,M ��-, �*1I�r� J ■ Iiffi.F.ltlJ 1999 �2 J=I 23 Government policy for SMEs - some recommendations by the Chamber difficult and time consuming to deal with a In crafting an SME policy, Government By Simon Ngan* wide range of agencies to obtain information should be mindful that this does not on the types of assistance available, there is eventually give rise to a situation of over t has been frequently quoted that a strong case for the creation of a one-stop regulation. A common sentiment expressed approximately 98 per cent of business service centre to better coordinate SME by SMEs is that government can help by not establishments in Hong Kong are of agencies at a central agency level. The doing more, bt;Jt by doing less. Private sector smallI and medium size and. that they Chamber rec,ommends that the SME office input is a 'significant feature of the employ about two thirds of the workforce assume the role of a coordination and streamlining process and active participation while accounting for about 60 per cent of promotional agency, with the delivery of therefore needs to be encouraged. GDP. The notion of SMEs as engines of support services taken on by institutions (like growth cannot be overstated and it should the Chamber, the Hong Kong Productivity Major programme areas fol low that greater attention shou Id be Council, the Trade Development Council, Although flexibility should be the key devoted to protecting and nurturing this and the Vocational Training Council, etc) ·factor in designing and implementing very important business sector through a and private sector practitioners (such as programmes to assist SMEs, there are some coherent policy for SMEs. trainers and consultants). areas where SME needs are generic and one The Chamber's SME Committee To increase the effectiveness of the would reasonably expect that similar suggests that an SME policy should aim at proposed SME Office, it is suggested that activities would be needed from time to fulfilling two objectives - (1) strengthening this Government unit work closely with the time. In the longer term, areas such as the institutional framework to enhance SME Business and Services Promotion Un it promoting information flow, enhancing dynamism by facilitating access, including (BSPU) and be vested with the authority business-networking opportunities, information access, to support services, and akin to that of the BSPU. removing impediments, and providing (2) removing constraints and impediments access to finance will need to be addressed. to SME development including, but not Removing barriers Other short term strategies that can be limited to, Government deregulation. A conducive policy environment adopted by Government in its SME policy benefits all enterprises by reducing the cost include training, problem solving Strengthening the institutional of doing business and removing barriers to consultancies, research and development, framework growth. In this sense, an SME policy cannot support grants, incubation subsidies, The most important aspect of be aimed at benefiting every enterprise just industry-academic cooperation Government's role is to demonstrate a strong on the basis that they are small. That would programmes, credit guarantee and loan commitment to SMEs. The announcement be corporate welfarism, which is finance schemes, and computer training by the Chief Executive in his Policy Address incompatible with free market principles. The Chamber has written to on the creation of an SME Office within the Rather, a policy for the development of Government with the recommendations Industry Department is therefore a SMEs should feature mechanisms to help outlined above. ■ welcomed measure in realising this business operators overcome market *Simon Ngan is Senior Manager of the commitment. Because most SMEs find it imperfections and market failure. Chamber's Business Policy Division 1J\ , fUfr-f-11�, � � m:¾it*tUU±� , ��§ rnrnt�muw O Jtl, t£i:J=i11\ru1t��1 ��ffitkJ,•'EI■-¥xma�,Llm&ff rffi � ilUfilti1t1 m � fQ� � s/,Jft� 11iI*�JmT!Ufi:J=i1J\ru1t��fUii:J=i,C,,, * �mttHTi:J=i1J\ru1t��•a�, •·riiw� :ffl.T�JfftE�JJffiB�R 1 t, , �tlf4-AJrX}rut 0 0 filfflff�ffiNili:ffl. �����m��.�0 §�•*$*i:J=i�ru1t*�fflW�JJ@xm JffM�a�,.Ma::k �AW��#W� 1r,1ttt!BlltM , 1§t�mi"J98% s"Jlffi*ti am�M,���ffl���xmm5��, M�$�ff,��-�•�Ll��-AA�� At#ff.t1J\ru i:J=i ¾* ·, st��s� 1/i� AIUkJ1ti �i:p�-�---,]!·�--,IE)Jlt�� �fflJJffiffUi�W *�AP�*z=,�ff.t*m**���* �JjJt:s'L1-:v:��tJ s/,JEIUii:J=iil'.,, Llff��-H-tl!�gt , t-t!! 1:-.@ tlglJJt 111,IE! , i:J=i1J \ ru :1i:'Jt�* J}JfillI 1J!f ��*i:p;J\ru{t�B/,JxWt!H#, ��ifi:p �JHtilJ 0 0 ���*-�,�-�tt���# m�� � ,�lffi��t/i, i� i:J=i,t,J!!UfHHJEiffQtiJl iuttE if it JH1Hr t%»IMi:J=iJ\ �ii::•ITT it n•��i:p�ru¾*�-,WWNtt*W� ���,Ll•���m�x•�•�•• ��•�Ll-���,@*Wtt¥�JJ00ITT fflN,���-&�-�fflffi�-��lffi* (�Qt�rffi�, �m1:".JijJ{Jtn!� , �ffiHiM ��¾�m�•�JJt.�m�����•m W�lj 0 �---�-��)��A�*A±(��� ��ru��,Ll��� 0 -&�W�,��� t!rffi�s�i:J=i;J\�¾������,i:J=i;J\ru �N_j(jH,,�) 0 �m��•mM�-ffi•�•••-m�•0 {t*�-ff!UUt�:k§tJ: (-) Jl!ID�t1Jrq� '&iTm iWimui i:p ,C,,sj �.U� ' llt '§ h tl t# 1i,I , }£fM!itW �tlHJi� r.,i� #JHl�t#, �*Wr£1�ft)f!Js�:1JJHrUt ('filt! •wirmm&•mJJ�•w��·�•a� �mtl1Ei:J=i1J\ru1t*�•a�, ��mun WHRB!Utl ,ff i:p1J\ru1t�s�Jf�J!!�ji� ; �tf-f-�fW��ffiE�s/,JfijJ -��]Jt�-� , iji]Bl!HHl!T!fHVII, JiJir.,���tt, & c=) ���il.titfr:p;J\ru¾*Jl�Bt�tll� ' §· W�R�--�--�-{t*�:s'L$M-I 1t (1.§.7fl!Utl �Jfftii:J=i1J\ru1t*s�iJfg0 m��lii •ww•wir�*�-m��•»-��* �m���n��ffrm��-,��� ftl , �Lt�H�ttv1WW11#Jl� 0 ��m�Mp;;iaJgffl��- ff�*,ffl�ffl·*--���I]�,�� 0 •rm•s��mm�m••·��Ll� �*� � 1tm�tit#s¥:l! tE�::kmU!UT, iuni:J=i1J\ *Ji O . �Jff���I�0 , B�Rx# i:J=i1J\ru¾* 1Hnf[�fli-'s'}i:p , fi�-&'§1r ru1t��-�.��-��T{t-�fflffi� * lJiflt1itlfI;zfs:1WI lffjif;tjft'fffS?fli,f&#l!IJJ! 26 The Bulletin February 1999 A s A N INDUSTRIAL TECHNOLOGY ' CO N GRESS Over 150 new technologies in Showcasing advanced Bringing suppliers andusers Manufacturing and Design, New technologies, servicesand together to explore the vast Materials for Manufacturing and products that will increase potential of readily applicable Environmental Technologiesto your business and clientele ... technologies forimmediate help you improve competitiveness benefits... and productivity..• 26 - 29 April 1999 Hong Kong Convention and Exhibition Centre ORGANIZER : f� The Hong Kong Polytechnic University SPONSORS: CO-ORGANIZERS : ■ Federation of Hong Kong Industries HKSAR K.C.Wong ■ Hong Kong Industrial Technology Centre Corporation Industrial Education ■ Hong Kong Productivity Council Support Fund Foundation ■ Industry Department, The Government of The Hong Kong SAR ■ The Chinese Manufacturers' Association of Hong Kong ·-x------Buy the AITC '99 Technology Digest 0 I wish to receive further details of AITC '99. � CD-ROM with this coupon for only A SI A N ' INDUSTRIAL 99 HK$20*(50% off).Trade visitors only. TECHNOLOGY C CONGRESS • *Free Admission for trade visitors. My contact details are as follows: Please bring your name card when visiting. O Mr O Ms O Dr O Prof Please reply to Family Name: ______First Name: ______AITC '99 Secretariat I c/oInte rnational Conference Consultants, Limited Position: ______Organization: ______Unit A, 3/F, Eton Building, 288 Des Voeux Road Central, Hong Kong Address:------Tel: (852) 2559 9973 Fax; (852) 2547 9528 ______E-mail: ______E�mail: [email protected] Website: http://www .polyu.edu.hk/aitc Phone: ______Fax: ______- EURO Rules change in Euro take-off he Euro will be more than just There will be direct comparability of another currency - its introduction production costs across Europe, possibly last month will force companies to leading to the wish to relocate production rethinkT their strategies and it could facilities and realise further economies of ultimately lead to restructuring of activities, scale. according to Mr Kenneth Fok, Vice 11 ln the absence of forex considerations President, Head of Transactional Banking differences in national taxes wi 11 become Division, ABN AMRO Bank. more important in deciding where to 11By eliminating forex risk, reducing invest," he.said. cross-border transactions cost and bringing Reduction in the number of currencies about price transparency throughout the in Europe will lead to a simplification of European Monetary Union [EMU] zone, the treasury and cash management and will euro wi 11 accelerate the trends towards provide opportunities for savings in various market globalisation and the European areas, such as reduction in currency single market," he said. hedging costs, improvement in transaction Increased competition and price services and possible lowering of financing transparency will squeeze prices, especially costs. for standardised products and services. Anticipated benefits of the Euro are that 11 As price transparency increases, it safeguards and supports the functioning differentiation through customer service of the European single market. It will and satisfaction will become more prevent the recurrence of revaluations and important. Low cost providers will have a devaluations, which have so often disrupted competitive advantage, 11 he said. trade and investment within the EU in the In the single market, companies will Mr Kenneth Fok, Vice eresident, past. define their segmentation criteria based on Head of Transactional Banking 11The costs of exchanging currencies language groupings or cultural similarities. Division, ABN AMRO Bank. and hedging against foreign currency risks 11 European export sales could be fiffiUtHr i�iUUtfi� will be reduced. Direct savings on restructured into domestic sales, distribution transaction costs have been estimated at channels may be streamlined by an increase between 0.25 per cent and 0.5 per cent in direct sales, electronic sales and direct alliances, acquisitions or mergers will GDP, 11 he said. marketing. Treasury organisations and risks increase. There will be fewer risks in cross and asset and liabilities management can be 11The present revival of mergers and border investment within the EMU. The more easily centralised," he said. acquisitions in the financial sector is, no elimination of exchange rate uncertainty Possibilities of joining forces with other doubt, part inspired by the EMU should result in a more efficiental location companies at home or abroad, through perspective/' he said. of resources, as it will be easier to 0 -�...t.�ffifil, £����5■ms"J�l1JI��RM�· ffi ; � ¾�rn , s"Jfr N_H& 1iUI rkiL��@:� pg ����x¾M�M�-��,%�•�m����¾�-��� il;¥a�fl��J�I1t O J •£El�W 0 �½¥�fiffl� 0 ffiM@fi�sawa�m -��B-�M�%�,0�W��* :Stm: 1�51Jttf:l1f , Jt�3'1--lil· fil� tf:l...t.�JlM 0 ±�*�0�%ffinJZ��-s"J••*�o 371--lil ��M s"J� iiffl iJJ � � ffis"J nlt 74q� � � 1mtm: r��tfftf:lm#M&,371--lrlMrr!� t\H{lf : r irJ�Wi�§ ■1-Js"J��Jl�f#ffl� -;�£$;*�®,�*��·�s"J�-� ffi·nmfi£$;*�� -�����B� Nrtffl•�*•••��,�&�-�ti *±-!!11:.ilSms"Jo.2s% � o.s¾ 0 J ff {{If�� r � J ) pgs"J 1R ;t�� 13Jrnt lfM:1Ja ±� , �ffifil1&�t1i'f3ltms"Jftiit O J m�ffifilff, ��@:pgs"JJYfl:l�-M�it 1tE®:1Ja�½¥m±Js"J-ffll1t, f�nx�V-H-� -�-��.-���s"J�ilnlt*�� 1fM�f� 0 j!j!1flilfR�tlJElz;!��y , M�£ m±Js"J%$; 0 J ����,��·•�•••��ila�• ��-����-�--��m••· o �Mi*:1Jal�· 1Jiif���rt...t.fr , 1JH�-®' lt�rJ� , ��-&'.l�t_UJU�tJi'f 0 1filt{lf : r�r,iitWti�•1z;1mHilx , �� lz;!ffn�JMJtWl*fts"Jil1:ii , · �[RfH�% 0 1mtm: 1EE1nt�f¥�3'1--lilJt�fU,5�, ��nlt���-£••*��-�...t.s"JffiJE 1m*� : 1[ijUJ/f1J-m��rt±�:1Ja, 0P1 M��ft�2�s"Jm$�Ait�W�&s"J� �M•��T���S?t��.��!!�■ O 0 2����5s"J��R�FWil�·�5s"J �1f!!ffl*i;W J � mt!' �rfl·[jfijW§r*��5rUIM��-� m•fflrt�*�ffl� 0 ffi$;*s"J�-�-®'A �VH�m:s"J�§��, �titM1ti!mR -&�1� 0 J lftt*fl� 0 J -�T�•�1fMfi���ffi���,filffi lilHrWsMl*:1Jal�' tlxT��tm±i; • ���•-m•,�*�••�m�• �•�m:�ti$;*•a��£•&·•�� **•--fl�.-��-•nx*�-�� o �,1�x1t•�*111*m±�tt� fUtWnlt* 0 it?Hl�M[P]�·,,f�itrHl���Jfff.;t��;tw 1filt�tf:l Jltf&: 1 , @JfM s"J3'!--�ij�•�� ����*iur-s"Jt(f�, tJt¾�rH1¥- ±itiJE, liY£M1"JliJ$7.)(f•[E)rffl�1tt 0 0 nltpgffl;�ffl·t�fflff&��m•s�• w•s"J��•1z;1•�m�w•R�• •� 1mt�tf:l : r11tis"J��rtm�T, 0� fi,'.5tfflI��tt$.�§r-�;ffjj�,� �@�mmfflm•��MmfR■fr■�s"J• MM���itlz;!&�ffl 0 ru�*�,��� 28 The Bulletin February 1999 compare business units and market But, there will also be a loss of "The combined GDP of 11 countries opportunities. sovereignty on monetary and foreign that will be a part of the starting group is 11 The will be deeper and broader exchange policy (i.e. the ability to US$6.9 trillion. This is somewhat less than financial markets, and an important greater adjust official interest rates and the GDP of the US (US$7.4 trillion). Export of role for the euro as a contracting and currency rates). figures of these 11 EU-countries (US$790 >ly invoicing currency in international trade, 11 lf EMU economies start to diverge, billion) are larger than the US export figure on partly at the expense of the role of the US$.. limited real wage flexibility and limited (US$625 billion). This also points to of This will further reduce the foreign labour mobility imply that the costs of somewhat more openness of the EMU� currency risks for European businesses, 11 he adjustment will, at least in the short-term, bloc," he said. ns said. to a greater extent be borne by the real Compared to the US the EU scores well ne The enlarged financial market as a result economy (that is economic activity and on balance of payments. On inflation, to of greater competition between banks and employment) and by national fiscal Europe will also do well, but the the enlarged capital markets will reduce pol icies, 11 he said. differences with the US are small. es financing expenses. EMU will also require There will be a small and temporary loss Regarding relative economic strength, of European governments to put and keep of investor confidence in the core Europe's present position compared to the ill their finances in order, which will lead to currencies. It will take some time for the US is not very strong. However, a us lower interest rates in the EMU area. EMU to acquire full confidence in financial European cyclical upturn has already cy "Purchasing decisions will benefit from markets. The Euro exchange rate may started and as for structural weakness, Jn greater price transparency - conversely, it therefore initially be slightly weaker, and initiatives have been and continue to be ng will be more difficult to apply price interest rates perhaps marginally higher, taken to address them. differentials in different national markets/ than would have been the case without the "Although it seems that most major 1at he said. EMU. These effects have al ready been governments worldwide would like to ng The introduction of the Euro will give largely discounted in present currency and diversify to some extent out of the US$, ill rise to cost-saving organisational change for interest rates. there is only a minor chance of the Euro 1d example capitalisation of treasuries, "There will be a substantial conversion ousting the US$ as the favoured reserve 2d standardisation of administrative systems as cost to society (e.g. the costs of realigning currency. The extent of the switch will also well as commercial opportunities. operational processes and IT systems, costs depend on the use of the Euro as transaction "There will be increased pressure for relating to the conversion and adaptation currency," he said. es structural reform in order to maintain of many cash handling machines etc). For Today, the US$ is the most commonly ks competitiveness - liberalisation of labour banks, these conversions are particularly used currency in trade invoicing. Despite >n markets, deregulation of goods and high. In addition, they have to face a the US having only a 20 per cent of world at services markets, privatisation, wage permanent income loss, due to lower trade, the US$ was used in 48 per cent of nt moderation, and a reform of social revenues from forex and money market al I trade transactions. security, tax and pension systems. This will dealings as well as from cross-border "Although the Euro will play an s- lead to further integration and flexibility payments, 11 he said. important role in the international financial 1e of the single market - which will help the The EMU of 25 member states will markets and as an invoicing currency in ty market to adjust to any diverging have an economic commercial weight international trade in goods and services, rn economic developments within the EMU, 11 equal to that of the l)S and larger than that the US$ will remain the most •important to he said. of Japan. transaction currency," he said. ■ lUL I R� ffi !Hl*±.�Ji�l!!H� �f'F�x£�We{J{jJfHlt5l O J 0 fil , ��*����trr����•,m•��05llft J �w•mw�tt•*�•m (�•�••• m�,�n¾&ffifi�x£�W¥m0 -��·•&ma*�·�&*•§JJJM� �ff�■ Rfi!i�r:i Ijfi'jJH·IJ 1999 1f 2 J'3 29 LEGAL Focus on GITIC affair Firstly, the raising of international currencies outside China. The State By Zhao Xiaolu and Xu Chunlei, commercial loans (including trade loans at Administration of Foreign Exchange and its call, short-term circulating fund loans, sub-level administrations are the Chinese Lawyers, China Law Office. bilateral loans and syndicated loans); authorities responsible for managing the secondly, the issue of bonds in foreign overseas issue of bonds in foreign currencies overseas; thirdly, the provision currencies by institutions within China. A View of the Regulations on of foreign exchange guarantees for third They are responsible for approving, Foreign Debts and Foreign parties; fourthly, the trading of various forms coordinating and supervising the overseas of derivative means (mainly the trading of issue of bonds in foreign currencies and the Exchange Guarantees Raised various for.ms of financial futures and use of the Kinds raised through the issue of by Chinese Financial options); and fifthly, the borrowing of such bonds, and managing the repayment foreign debts by subsidiaries registered in of debts in this respect. Institutions and Risk Control Hong Kong. for Rights of Overseas 111. Commercial Loans II. System of Management and The State stipulates that a system shall Creditors through the GITIC Registration of Foreign Debts and be applied to strictly review and approve Affair Foreign Exchange Guarantees plans for borrowing international Foreign Debts commercial loans and that a separate plan In line with the principle of centralised shall also be applied to regulate the quota n October, 1998, the Central management by corresponding authorities, of short-term international commercial Government of China ordered the Chinese institutions managing foreign debts Loans. That 1 s to say, all institutions within shutdown of Guangdong International vary according to the different types of China, except for foreign-funded enterprises, TrustI Investment Corporation (G ITIC), foreign debts. The People 1 s Bank of China shal I gain prior approval by the State sending shock waves through the banking is the Chinese authority in charge of the Administration of Foreign Exchange of their sector of Hong Kong. Newspapers and w o r k of review i n g an d a p p.ro v i n g plans for borrowing loans overseas. All magazines in Hong Kong widely reported applications for international commercial borrowings of medium- and long-term the affair. Now, guaranteeing the legal loans, authorising the State Administration international commercial loans with terms rights of creditors became the main focus of Foreign Exchange and its sublevel exceeding one year shall be included into of the public. administrations to specifically review and the national plan for the utilisation of foreign approve applications for international capital, and shall be required to gain prior I. Major Forms of Foreign Loans commercial loans and to supervise and approval by the State Administration of Raised by Chinese Trust Investment manage the use of such loans. The head Foreign Exchange. Without such approval, Institutions office of the People 1 s Bank of China is the any contracts signed for borrowing loans At present, relatively large Chinese Chinese authority responsible for reviewing overseas shal I not be effective, relevant fiduciary investment companies raise and approving applications of institutions foreign exchange administration authorities foreign loans mainly in the following forms: within China for issuing bonds in foreign shall not register the loans concerned as tt; � fflH#tlHHi11 � a'9 � 1 - , � � m fi¾��ffij����•m•a,�•-* m J\:i, , 1iiHI ( li5tffffBrfi$�� ��:it >1rlmff J11[%iJJJz5J \.%b �RftW �� r$j��)}"" PJrffBrfi) § 1ru , q:iil �:xAfHJ � f� fE:19: W0 � �-m-�•ffiffW 0 q:i•A�@fiSfi IUJ ±���W�h��*$M:ffl-- � ±i rg f!H1f(£W�Hrfl ±i \. � WM ttt M 1'- 1' �i r$j iH""� OP [P] � !Jf JJJc , ?;11WHUiJ W 1m -*>'r 1r1 ff Jll[ %b JJz,; 51 %b�u ft • ff w fft ft � 14- :k IN 1z- j!k #1; ft# ��ff"", ���ff"", �lll�t""�l ; ffl ��-Nftft•�----�--� 0 -ff fltJi 1-t , flt lli JJI1¥- tl; ii- It ±JUH1Hr>'r m:1• � ; m-=:: , � m-=:: ¥fiWJJz�-����ffiffiSmffW h m 1;!!;>'r 1r1 11 f% ;m � , % 1rnr � I� t}l;t-2{� >'r1-J;f!iA {,!; fel &t-M" x£ (±�¾%ffi��U,��tPWHix = . � � iffHiUUx £ l ; ffl 1i , :f£-lffi 1ilE s 30 The Bulletin February 1999 foreign debts, Chinese banks shall not open bonds issued shall be included into the plan borrowed by other government authorities foreignexchange accounts for the loans, and of the local governments for the spending of and enterprises (including foreign-funded the principal and interest of the loans foreign currencies and will be bearable by enterprises) in China other than those concerned may not be remitted out of China. the local governments concerned. .., registered regularly, they will be subject to For short-term international commercial case-by-case registration. loans with terms of less than one year V. Registration of Foreign Debts (including one year), foreign exchange China applies a system of registration VI. Management Institutions and administration authorities shall manage them and management of foreign debts. For their Major Functions by the balance, and the State Administration institutions within China (including foreign The State Administration of Foreign of Foreign Exchange shal I approve the quota funded enterprises) borrowing loans Exchange and its sub-level administrations of such loans. overseas or issuing bonds in foreign are the Chinese government institutions in currencies, should contact the State charge of managing activities of foreign IV. Overseas Issue of Bonds in Administration of Foreign Exchange and its exchange guarantee. They are responsible Foreign Currencies sub-level administrations for registration. for reviewing and approving plans for For institutions within China needing to In line with relevant regulations of the foreign exchange guarantees and managing issue bonds overseas, they shall file Chinese Government, the funds in foreign and registering activities of foreign applications to the local foreign exchange currencies obtained by borrowers from exchange guarantees. administration authorities. The applications foreign-funded banks and Si no-foreign The total of the value of foreign filed must be submitted to the State joint-venture banks registered in China shall exchange guarantees provided by a Administration of Foreign Exchange for be treated as foreign debts, which shall be financial institution and the value of its review and verification and must be subject to the registration of foreign debts. foreign debts may not exceed 20 times the transferred to the head office of the People's However, the funds in foreign currencies total of exchange capital in its possession. Bank of China for approval. Institutions borrowed by foreign-funded banks and The value of foreign exchange issuing bonds overseas for the first time, Sino-foreign joint-venture banks registered guarantees provided by a non-financial must apply for the rating of credibility. Only in China from overseas sources wi II not be bus_iness corporation may not exceed the those satisfying the required conditions in treated as foreign debts, which shall not be amount of exchange capital in its the rating of credibility can issue bonds subject to the registration of foreign debts. possession. Chinese guarantors may not overseas. The registration of foreign debts provide foreign exchange guarantees for the For the issue of bonds needed by the comprises case-by-case registration and registered capital of their foreign partner in business operation of the issuing institution, regular registration. For the foreign. loans foreign-funded enterprises. the funds raised must be used in line with borrowed by banks and non-banking Institutions within China may provide the approved use, and the issuing institution financial institutions in China as well as the foreign exchange guarantees with the letter will be liable to repay the principal of the loans extended by foreign governments and of guarantee, the stand-by letter of credit, bonds issued and pay the corresponding international financial organisations which the cashier's check, the bill of exchange interest. For the issue of bonds by are separately under the management of the and so on, or through the mortgage of commission from local governments, the Ministry of Finance, the Ministry of Foreign property or the pledge of movables and funds raised shall be used for projects Trade and Economic Cooperation, the rights in line with the Guarantee Law of the designated by the local governments People's Bank of China, the Ministry of People's Republic of China. concerned, and the repayment of the Agriculture and the Bank of China, they will Wholly foreign-owned enterprises may principal and payment of the interest o� the subject to regular registration. For the loans provide foreign exchange guarantees for ,J fl1Hei, il.H-'rJl!::f 1�� ;tJ;:tl5HHMtU � 5 *�m�,ffi�¥&rtJ���mpgtt �pg■Mml2,(�ffl��·•fflmmm• ffi�*A�::f�lliili�* 0 JL-�AA (� fRt13{] !Jr iUR fi fQ If'5r � • fflfi 11A 13{]!Jr Ill *�--��%�iliA�m,�**•<'f' -1¥ l 12,(� 13{J�iAA � � 00�:ltiJz , :MJ 5rEEi -� m fRJ5Hl , �l MHHHl 1Hei; W Jl� � •Ali�ffi�-�$:)mk,12,(M���¥1l lllff:E1.=s:�r�•1-=r�t1ffi1., filiocEE��!Jr • fi rt1 m !Jr11 A � >'r• • � ffe-lJ ::f �i !Jr� � 12,( i/J �· tlUIJ� 13'.¥11 ° Ill JUuff ttU'1E 0 • , ::f�JJJt fr 1ttei 0 � !Jr lffi" � • 1t � m §!Jr fitJH� • • 3Jrfl¾tc7J"'� �•1tteifQ5EAA ¾tei �, W • M 1l ¥1JJr Ill�;£_I ttU'1HrfiD , ?M!Jr [9. lt9��fi9��11� }L � pgi& fi fQ ?F i& 1'r � ;� • tl fl A � !Jr tt��i'#l!Jr•�J-'$ rrnut , � f!Utt� m pg�Hli' M tE.IJOr JI fi {l 13{]� , {ij rtJ M,12,(R��EEIM�$·••$·��A •t� 1t !if!,!Jr Ill Jj_ff $ r� $ � ' ¥U�l * '.>'rIll Jj_ff li@1'r • •�$ • ��t&fi�:Ws{JH�� tt�Am:1�?M5'Hi�1i , �1t¥1JmtE �•tt , WEE�%5r lli ff J1.�¥KIf'� A Ii Mit�ffi���MMffl:1t�,:MJffi5EAA¾ �*••�*�•m-�¾��- 0 ?Mm fflfiSfilliM 0 ��VM�ffi-�$�ff wei O �»tz!Jr, �pg;tJ;fm$r� • ¾� (-e2 5ktiHr�Mwi�1twc�*•* , 5riHE�mfou f.&, fff.& r.f � J:Ji � � 7t ��fl V 0 ti !Jroo � •1t � l 11 ffl !Jr1• a� �l � * 1t ::ftfttt li;tJ;�T �!JrRIMI w � lliRlliili m 0 VfiMffl�*��B•ffWM¥¥fiM wei !Jr 0 ��,M--��ffi*&lliM�ffl��ffl, � !JHUlA� M J'E ::f fUtfRJ � .=tRR -�*gEEl¥MMffl�fi--;��n�m 7" . �l!IHl&���,rn� e1ln�Meffl�::ffRJ$:. 0 1lffl.=tR* ��¥fiM��,M--���ffl��n� Ii* !JrIll ff i_1fQ %D !Jr• � JJ.� %D �!Jr � pg !i!?.it fRt P10 , W- ffe,lj_t � � � 1! W � Jff3(tj�13{jrj'i § , {tm1•�*'�JlU#�A:M1!n!Jr •-��ff�MH·ft••m•ff�ffi¾ $;flffl.=tR���mttW0Pl,ffil�_t 0 0 IH!L�ili�lllJ) EE±filn�Jff�:W1tm O weiNlllm� �-wmt�_g1Jfi�l@J!WilR�t � �tM;tttfl:1�� !Jrllffitt��tJiRJt!Jr tJ!!Jr M tl A 1r M J'E1l ft 13{J% � R 1i � E. 9HiBH2 fl�tJl,%UQ � , ::f1���MM=� !Jr Ill-� %fRJ��-�� o *����-,��� o ��-1'r>1Hl1Heiff�tti& 0 m pg8 13"1 20 fir O 1F�WiU't13'.�it�$:AtRd�l3{J !Jr fRJffi.�%[RJ�$;-�*�::f-- �* tt ( '§:/%3lr00�•1t�) t-HHli!rfl�Jifi!Jr Ill ��$Jim , ::f 1� � m� M= �BHr Ill • � 1! tei s"J !Jr1• ».!Jr • • � � � :x�1% $ � 0 �fl�, ±:g�JltE� %3lrlliff��RJt>B- fou � •�A::f1��3Jrlffi� �1t�sHrnt1 [RJ,*��li$fi��$;-�*-�;}L 1Hei 0 $ �*m:f�-� 0 �i7Ff*�¾l'lEB{J37Hl · >'rlliti�RJtfili!Jr I ifi'f J:!flJ 1999 � 2 J:! 31 LEGAL themselves, which is not necessarily subject contracts, and shall be handled in transferred to the third party under a special to the approval of the State Administration of accordance with the legal consequence of arrangement with the agreement between Foreign Exchange. However, the provision of valid civil acts. For all the contracts for the creditor, the debtor and the third party. foreign exchange guarantees by other forms foreign debts, foreign exchange guarantees And, under Chinese law, where a local of businesses shall be subject to the approval and other forms of foreign debts (such··as government or the State commissions a party of competent foreign exchange administration deals of options) which have not been to issue bonds in foreign currencies, the local authorities. Otherwise, the foreign exchange registered in line with the law, they shall be government or the State shall be liable to guarantees provided will be invalid. invalid civil contracts, and shall be handled repay the principal and the interest on the After providing foreign exchange in accordance with the legal consequence bonds issued. guarantees externally, guarantors shall of invalid civil acts. Overseas creditors should conduct contact the relevant sub-level foreign Overseas creditors should conduct studies about the possibilities of the exchange administrations at their place of studies about whether other subjects of debts conversion of their creditor's rights into business to go through the formalities for legally assume joint liabilities in the capacity stock rights to restructure liabilities. The registering the foreign exchange guarantees. of debtors. For example, under Chinese law, restructuring of liabilities is conducted Where guarantors have not contacted local where the ·registered capital of a company mainly through merger and acquisitions. foreign exchange administration authorities is insufficient, the shareholders of the For overseas creditors, they should have for registering the foreign exchange company shall assume joint liabilities for strict legal risk control measures for their guarantees provided, the foreign exchange compensation. Where a debtor concurrently future extension of loans, in order to establish . administration authorities concerned shall not holds the right to claim the repayment of a benign circle of debtor-creditor relationships permit them to purchase foreign currencies debts from a third party, his debts may be on the basis of reliable legal guarantee. ■ or remit funds in foreign currencies out of China in honouring contracts concerned. Overseas creditors should conduct studies about the application of different THE HONG KONG GENERAL CHAMBER OF COMMERCE laws in different subjects of debts and ANNUAL GENERAL MEETING different ways of raising loans. Where subjects of debts are institutions within 27 APRIL 1999 China, Chinese law shall apply. Where subjects of debts are registered companies The Annual General Meeti11g of the Chamber will be held at 6:00 pm on in Hong Kong, relevant laws of the Hong Kong Special Administrative Region shall Tuesday, 27 April 1999 in the Ballroom of the Island Shangri-la Hotel. apply. Registration of members and a cocktail reception will start at 5:00pm. Overseas creditors should conduct studies about forms of debts and the legal SIX members of the General Committee are required to retire this year and binding force of contracts for loans. Under may stand for re-election. They are Mr Peter D A Sutch (John Swire & Sons Chinese law, the legal consequence of valid contracts is different from that of invalid (HK) Ltd), Mr Peter Barrett (Organisation Development Ltd), Mr Linus contracts. All the contracts for foreign debts Cheung (Hong Kong Telecommunications Ltd), Mr Walter Kwok (Sun and foreign exchange guarantees registered Hung Kai Properties Ltd), Mr Victor Li (Cheung Kong Holdings Ltd), Mr J in line with the law shall be valid civil B M Litmaath (Scarfell Enterprises Ltd). M%�(��mM�MM�£�l ,--� • Any Chamber members intending to nominate for election to the Genera} -��-��·*•��-fi���-� Committee should contact the Chamber Director, Dr Eden Y Woon, on *�1:10 telephone 2823-1211 or facsimile 2527-7886, BEFORE APRIL 1. J:UHJHi JdlHJHi:tJo A !�H J� -]t , L:.J,1it �tih¾���ffl��-�ffeWWfflWff ���-B�a 0 e�&·�*��WmJN:* -�--- � , �o *0 RJ tt fffi��::f � , !'!U0RJ fflffeWWfflMMWff;�*MBAfiffi� -�--7':- -1L1L1L._lm.ij B ��--•�MMJ\,MffiJ\,ffi�Am =+-c �.�-��•�m�r�m�mMB; �o * tlHI 1!.m � ' till ifJ1:h m � � * � � • 7t1¥M1¥931!11¥•�*•��m--nnn1¥1L9F.I=+-t s(�Jt�=rf �fijrm:fl� , fU't*,@,El3 f4t!7JifJ1:m'� il 0 *�lfflm 0 :S17'�1iB�i;��A��ffl-ffimm�mm*M�$fi 0 WJ���&��n•� !IU!r ' :It!JHJHi A 1r1iJf Ji M¥f il tut � ttML:.J,�fflBmffl��OO tt 0 M&mffl� 0 • �� , /\iirit��JgifPff , :M(i:u���Wm31 ° 1m1r�:SB1J�Ji*� ■�L:.J,•m�Mh��fi ��•Mffiffl� r�-s$*��r0RJ���0�, (ffiffl*�•��m0m) ,.�(••um•��m0m))f§ ( ,� ••A��•re•m�••"��•m• 7)( � ffi ( )i � m � �N 0 m ) , �M� fir)1,� �±tE, £ B m � �N 0 rr0RJ���0RJttM,�m�••� »! 0 m) '*•�(�rr•••��m0m)&*�(����fi) �{f , :ll!JrMtiAitt�a��¥Jr61&WB� 1!--���ffl�,L:.J,AA��-��-� • �••�w���-•�1¥9•�•�m-��-aMw••���2823-1211 ; 2527-7886 ¥•�·���tt�ffl�ffiRNffl0■ tt±t�** ' �� : 15� : ° 32 The Bulletin February 1999 TAX Mainland export VAT Vincent Lo and Caesar Wong of other words, the corresponding input VAT was laid down by the SAT in mid-1996. could be refundable to the exporters. These Circulars stipulated that for the New Arthur Andersen However, there have been numerous Enterprises, the ECR Method and the Pay subsequent changes to the VAT policies on Fi rst-Ref u nd-Late r Method should be export sales announced by the responsible adopted for export sales. An examination of the changes PRC authorities since 1994. The major • The PRC government has also in PRC Value-Added Tax changes which affect the FIEs are adjusted the VAT refund rates on export policies on Foreign Investment summarized as follows: sales several times. For goods which are • Ministry of Finance (11MOF11) and subject to VAT at 17%, the Enterprises' export sales State Administration of Taxation ("SAT") corresponding VAT refund rate for export issued Circular No. (94) 058 in August 1994 sales of these goods has generally been ver the past few years, the Value which stipulated that for FIEs established reduced to 9%. As such, the exporters Added Tax (11VAT11 ) policies on before January 1, 1994 ("the Old wi 11 not receive a fu11 refund of the export sales in China have been Enterprises11), export sales are exempted related input VAT. constantlyO changing, making them difficult from VAT whereas there is no refund of the • To tackle the problems arising in the to follow and confusing to foreign investors. corresponding input VAT. This is known as implementation of the VAT policies, the In this article, we will firstly outline the major 11No-Tax-No-Refund11 policy (11the NTNR State Council announced in February 1997 changes over the years and the current Policy11). that for al I export sales of production policies. We will then analyze the impacts • The SAT issued Circular No. (95) enterprises which export their products of the current policies on the export sales of 012 in February 1995 which stipulated that themselves or through import/exportagents, foreign investment enterprises (11FIE11) in China. for FIEs established after December 31, the ECR Method should be adopted with We hope the following discussions help 1993 ("the New Enterprises11), the Exempt effect from January 1, 1997; the Old readers understand the subject matter better. Credit-Refund Method (11the ECR Method"; Enterprises should still follow the NTNR please see Part B for details) should be Policy until December 31, 1998. A. Major changes in the policies adopted for export sales. This means that Subsequently, Circular No. (98) 184 was Pursuant to the Provisional Regulation for the New Enterprises, export sales are issued by the responsible authority in late of Value Added Tax of China which took no longer subject to VAT at zero rate. 1998, which stipulated that the NTNR effect from January 1, 1994, export sales • Circular No. (95) 92 was issued by Policy for the Old Enterprises is extended were subject to VAT at zero rate (0%). In MOF in late-1995 and Circular (96) 123 to December 31, 2000 while the ECR � � � 9% , ft fJ' �0'-J � rJ fR $: ��� �$:fil@Jo * � it fl m fi r:p tll09 ™ r.,,Ji!! , iiti � "!Jt 1997 4 2 )=J 5JJi fij � i¥ 1£ * § 1f E'X � t-Ett:£1 ill P �� � - � § 1997 4 1 t5t i:it * 0'-J I¼: * $ti: � �1% �Q T fa11BMl'.lfi,�, tff· filJM�;@ m*�5t�, �1��7'c� * !'!tI¼: t� 1k ii * fR � tm fE!1 "!Jt 1994 �it*{J!J PT MUIfi jf 1� 1l �filJ I¼: �1�1}� 4 8 faJ T � fR M * (94) 058 JffG x f4, * � 1998 4 I 2 )=J 31 B O Jt: 1f , fJ' � 'lr� £;t 1994 4 1 )=J l B CJ 1!1J r#f=Jll[ I rffi 1f !c r� Jit 1998 4 m'i T �i M f5l '=¥= (1998) 184 JffG 89 5il,rffi��iE:* (CJT$lP} 1�it Jc 14 , ��::tit*'.l fi ,� 1l �filJ I¼: rt IN j;f- � ;J� �if:f£- -Jt tl1 o 1t *J • nm: ,� 11� i!8.J I¼:*, en 1: i¥ � *� 2000 £J=: 12 faJ 31 B ; ffeJr 1£ * JlU 'mf • # Jf 11I. :f}l j[l_ Jtf- {/J iJiJ 11- �11:tiill P�1t±�11IfR, ffff:rJ'lffl89 iJU* ffl 1� , tlf, filJ r#f= 1!: 0 �JJifR$:�ri!8.@I £@:t!*fill, ¥U ElftJ�lt, 1¥!1�£-t W_iL -t: � 4 , r:p � - 11: � m illo� * 1995 4 2 faJ T Ji EB � m � (1995) 1r rffi � �* it 09 ill o �� • +r m rl �� EB±� ffi ;m I¼: * ,Wi Fdl 4- ¥U � :J_,, 012 JJ;r. X f4, ti 1993 4 12 faJ 31 B CJ� fR 45( I¼: * : -¾ fl � 1£ * tlj .P �� 1r rffi I®¥U � � fQ � CJ @ 1JE O * x 1r � 11 Jll[ I rffi 1f tc s9 1r rffi t9: � 1t * (CJ jffi 1� 1l �fil J � * � 2000 4 12 Jj 1� � ill P �±� � 11HR I¼: 0'-J* ± � w!J T $ f-m f=JT, it *J) 1: i¥ 89 tll P � � � 31 s ; .= :;lfHM f=Jrit* 1f fr�, , tlf, mfQ�+rI¼:*, Wrm'ftitjHJr�+ri¼: JI& r � ' t� ' i!8. J ¥,0¥ m (¥l1Hld$ Jl * )( m J m rt � :rll[ ill tR 1=1i!8. O m m rl I¼:* £-t ill o0'-J 5ir rffi tJt �1£* 0'-J � 21 , � -z, fffS 1;t) fhHJI[fR ill1=1i!8. , 2JJ' ep � 7K fJT 09 � � .:1: � & � tE � *'JJi m$: ill fQ * 0 0 0 � :tm � al �£-t � !� r.,,� 0'-J T m it* tll o ���W'.l1'r�f�$ tll t=1i!8.fRnffif * 1995 4 ffi'i fQ 1996 4 r:p Y. )t �lj --r El3-��89�� Ji M fR * (1995) 92 Jli. fQ ii fR�i (1996) z;. 1 � , :ttt, mJ � 51 -tlHf r:p iiff£1994 4 1 faJ 1 13 Ml 1: �t 123 5J1t ffi 1½'-x 14 , :I: f=Jr Afl JE tJrit �Uh$ _t � ?Jd� ,�, tlf, filJ it t! FI EE EB ±� rn m � +r f� 1� m JE , 1£ * ill 1=1 � :rll[ ill o m m • fi r � , m , mJ fQ 1�J , ,mJ ffi ,i!8.J .::: 1!00 � �� 0'-J tp- � tm0'-J ±� m tR • +r �fR $ , 2JJ\ ep � JK fJ' r � 1111 i!8.J m ti m r* 0 f.i§. Jt\t , Jffi :fll[ �Q T : I! 0'-J � JJifR $Ji PT � � � i!8. @I O f.§. 1994 * J'tJH�, r:p ii I¼: Jff%1f � iJC w!1 � ill 1 �J - ¾ t� � 1: it*i¥ El 1! tll 4 CJ * r:p ii fJ' � *� r, � {JC � m ill o o �� 0'-J i!8.m * , Jt: r:p 7% nc1 tR * 11 o E'X � t-E 1r � it * rt :r1 ±l o 09 ill �� 0'-J ±t ffi fR I¼: 0* Jt: r:p , Yt/1 lk 1r rffi 45e±�mm0"JJttm, ili 1=1ffifR$-m: tm , � 11 1: i¥ i� � ff01H9 ±t 11t 0m r/ffiFI f1J 1999 � 2 FI 3 3 According to relevant requirements, the formula for the ECR Method is as follows: Net VAT Output VAT on All NCR amount Unutilized input payable in the domestic sales in - ( input in the current ) .� credit from current period the current period credit period previous periods where, The NCR F.O.B. price of VAT Composite value of bonded VAT VAT VAT amount in the export sales in x - refund - materials in the current period x ( refund ( rate ) rate ) current period the current period rate as ascertained by the Custom rate The NCR amount (which can be up to 8% of the F.O.B. price of the export sales) becomes a cost to the exporters. The amount of VAT refund on export sales is calculated according to the following formulae: If: F.O.B. price of goods x refund rate Unutilized input VAT then: VAT refund= Unutilized input VAT On the other hand, if: F.O.B. price of goods x refund rate< Unutilized input VAT then: VAT refund= F.O.B. price of goods x refund rate Moreover, Input VAT brought forward to next period= Unutilized input VAT of the current period - VAT refund Method should continue to be used by the B. The ECR Method of the above enterprises, which should New Enterprises. The ECR Method consists of three inter be refundable, can be used to credit In summary, the two sets of prevailing related procedures - Exempt, Credit and against the VAT payable on domestic VAT policies on FIEs' export sales are as Refund - as described below: sales. follows: • For Old Enterprises, the NTNR Exempt Refund Policy should be applied until December For production enterprises which export If the export sales represent 50% or 31,2000;and 'their products themselves or through more of the total sales value, and in a • For New Enterprises, the ECR import/export agents, the export sales are quarter, the amount of credit is greater Method should be used. exempted from VAT. than the VAT payable and the excess The main differences between the two credit has not been utilized, the policies is in the amounts of input VAT that Credit unutilized amount can be refunded to the can be utilized and whether the VAT refund The input VAT of the raw materials exporter upon the approval of the is available on export sales. used in the production of export products competent tax authority. rm:J - ¾ t� m 1=t 11 i£ � 13ft 1illJ- ¾1�1=tiii£�§f!;tl:\P 3:: � tl:lm Pfil B"J m l1HI II tttl1b £;t tl:l P � �1E �r � i£ � 1-t Jlf!. tl:lB"l P � � 1E �r � i£ �1i: W tl:l P 1ti1t � !� * tfi :t□ Jc B"J m tl tHJ'- r � filfJl 0 it� J!l -f-B"J illii §dt ffl *-H4 Yr� i£ �'it M � t� 1t �i§ � tJi 50% � _t It B':Jii JJ m ii tfi f□ pq !§ 1t �B':J J!l B':J, {E-1mJ*JJt pq, IE!JlfiliiB"JfJl pey . It 8:1 i:1iE:�U1'9 � W � m t}io n:xntffl�mmnm*m1□5cffi¥, }� tl:l Cl i£ � �TII 1 L' tl:l Cl 1t tmii& tui ��it JE, r�, tll, �J i¥ 51dt � 0 � �□ r: 1t M Jl 1tMpqi§1t _ 1tMii _ 'itMtl:l Pit��-f-�W:- iut :t□5c ( ) * m �mn � s':Ji§ r1 m n JJif}?, • m f□ f□ mm s':Jm • B"JiiJJimmt ;It � 'itMiliP��� " 34 The Bulletin February 1999 TAX C. Impacts on export enterprises credit11 (please refer to the formula in Part B increases the cost to the exporters in respect Apart from the changes in policies, above), the amount of VAT payable should of the export sales. exporters are actually more concerned be increased accordingly. Moreover, the As illustrated by Example 1, since the about the impacts on them of the prevailing balance can neither be carried forward on negative amount resulting from deducting VAT policies on their export sales. Here are the accounts nor reduced to zero (i.e. the NCR amount from the input VAT cannot some of the issues which are frequently zerorized). Therefore, although the New be reduced to zero, the exporter has to bear discussed by the FIEs: Enterprises only utilize bonded raw 8% of the added-value of the export goods • If the New Enterprises utilize materials and export all their products, in (which is equal to the F.0.B. price of export bonded raw materials for the principles, the exporters have to absorb that sales less the CIF value of the bonded raw production and alI the products are VAT cost (which can be as high as 8% of materials used), which increases the costs exported, is it true that the adoption the added-value of the export goods). This to the exporter. of the ECR Method has no impact on them? Example 1 - Impacts of the ECR Method The NTNR Policy better than the ECR • Are the Old Enterprises following Method? on export sales using the NTNR Policy better off than the As the VAT refund rates are lower than bonded raw materials New Enterprises using the ECR the VAT tax rates and the base amounts for Assumed: Method? calculating VAT payable and VAT • If commercially feasible, should the (1) All products are exported at F.O.B. refundable are different, the VAT borne by New Enterprises utilize bonded raw price of $300. the exporters using the ECR Method is materials sourced from overseas in (2) All raw materials are imported into generally higher than those following the place of raw materials purchased in China under bonded treatment and NTNR Policy. Nevertheless, for exporters China? their CIF value assessed by the utilizing mainly domestic raw materials, • Purely from a VAT perspective and customs is $200. they could be better off if they use the ECR subje ct to the export ratio (3) VAT rate is 1 7% and VAT refund Method than if they follow the NTNR requirements, should enterprises try rate is 9%. Policy. This can be illustrated by the to reduce their exports and use the VAT on domestic sales $_0 Example 2. same for domestic sales? Less: Input VAT $0 In the above Example, for the New We are going to discuss the above Less: NCR amount ($8)* Enterprise using the ECR Method, the VAT burden is $24 (i.e. 8% of the F.O.B. price questions briefly: ($8) of the export goods). With the same VAT payable Impacts of the NCR Method on export _$1L assumptions, for the Old Enterprise * NCR amount sales using bonded raw materials following the NTNR Policy, the full amount = ($300 X (17-9)%) - ($200 X (17-9)%) Pursuant to Circular No. (98)432 issued of the input VAT (i.e. $34 paid on purchase = $8 (8% of added-value ($300 - $200 by the SAT, it is stipulated that if the 11NCR of domestic raw materials) incurred in the 11 1 = $1 00) of the export goods) amount is larger than the 1all input VAT production of the export goods is not m s{J � � 7r , 't: fr� � • 1! 1UJ 11 :m fi � ill Cl , ill mi Cl11::� J!IJ _t �]: � it � � ffi � 't: fr, s{J � • , fffl t&: :x Mu � ili o � � ±i m $ 15t s{J8% s{J ±1/: m m (t� -) r it, m, filJ m 1t ��tit� * � 0 s{J ';lit Jl r.,�HJ! 'fil 15T jU � I� fj , 4- ill Cl 11::�s{J nit 7-Js: ±i :/J□ tll 11:: * s{J � � *iL�dJrif:�BRffl *mtit Cl# � fJtl - JiJr Jl , EE � � � 7G 1l t1= 11!:Ui 14 , w £ � � tt tr i� , BR m r it, 1 � J it • , _t � ili Cl miiE: � &U _t w (1) � $ � !Im tll Cl, M T=? 1J t� 'hi :fi£ , illJ 1¥ 1! ¾ � � B fr, ti � � JI? � � it :f§ � JiS: ill Cl �!Im ±fili 00: $ {5t $300 *¾ � � iE: � ¥A fr 17G� 7G illJ � ( �p ill Cl {jf£ � *fJl tit Cl f4 14 s{J t� � $ mi )¥4* tit Cl , #tJ: 1UJ i� t¾ it BR :t� , ill J ?! s{JfJT 11:: � i� s{J 8% , 4- � ill Cl nit 7-js:�:/JO 0 (2) � m m m r it, m {jf) fl � $200 ���fl�? 9% 0 *�¾PJ���, MiE:�¾�,l!j [?G IL:Fill J tt 1� , � filJ Af:? (3) � oo:m * 17% ; m m * �� � :I:BR ffl � Cl f-H4ft � � tE � pg 1zs1 illm * tt � m * 1� :fll it • � BRM *4 14? illf5ts{J¥lt7G[A], -�rm�, tlm pgi� � !Im s{J t� JJi m n $0 *¥1fU�OO:m�Jtrffl�, if:�� tit;¥4 :/Ja I 1 � iim � s{] ili o 11:: � , • � : m rJ m M $0 � ft ft ifF s{] �I it pg � Y ili Cl � !Im rm lr I it' ta: ' filJ m $ fr tt, jf fi I 7G �: 7Grit�- ±i:iJO pgi� l:t{Jtl? �7G illJ ?! s{J 11:: � � 1! $ ±t m 111 s{J m tL£ to :tP filfJl lJi tE , fr� � lf.i:-t ffJt �IUl r.,i J1! tit fr fJl 0 {§.¾, �JiS:±�BRffl Ii pgmif4 M s{J fJl '.ffj ($8) * • t1 � 0 s{J ill Cl�, 11:: f! ffl 1it' ta:' filJ '1¥ ?!& ffijfr tt 17G�7GfilJ '1¥1!ff(�� O 0 .ilL:__� illJ i¥ f! ft Mt� � l±H't Y s{J ±� oo:m � it � � 1� = � a1J ,,qep f:E fJtl = 9'1 , BR fflit, I :tl , filJ ffi t� f1l II f5t � (1998) 432 � x 14 s{J ?ti:, ill Cl 11:: * s{J � 00: ;fil � �it'hi$24 * �r��- titofoillms{Jmtfi 0 tJi JE , Ii ili Cl � !Im 7G (&P M T=? 1J s{J 8%) � � :t; 11:: �o I WI r it� , t� * � = ($300 X (17 - 9) %) - ($200 X (17 - illfJl s{JfJl �J M� r1t JJi s{J 7G fil J 1* ITT • , • ili ta:to to * WI� m r � � m rt 9%) 7-Js: Z, fffH5t 0�) , � fJl tri o��it�±�ffim, 1.§.tEtl�mi# m tJ!J (Jl x = $8 'if :f§� ±i :/Jo , � tri 7G li t#� #i ,t , � 11 � s{J $34 JJifJl � tl � ¥I :t�to m (&P tll Cl 1li !Im ±t 00: $ {5} ($300 - !l 7G 1l � 1� J ITT• 0 lzsJli . t , � f! fJT 1zs1 ffij � i£: * s{J ±t ffi fJl � � ft � $34 11::�,R tlffl *fJl� Cl*4f4fffl £ �� (±� m m titrJ m M) 0 ljJ' &P ¾ tJltE _t � $200 = $100) s{J 8%) I�JHIJ 1999 �2 fa.I 35 Furthermore, it was recently reported borne by the Old Enterprise is still $34. As a Example 2 - Impacts of the ECR Method that the PRC government had decided to result, theVAT borne by the New Enterprise on exporters using further increase the VAT refund rates for will be $34 less than that borne by the Old domestic raw materials certain goods in order to reduce or even Enterprise (compared to $10 when theVAT Assumed: remove the VAT to be borne by the refund rate was 9%). As such, Old (1) All products are exported at F.0.8. exporters. For instance, theVAT refund rate Enterprises will not necessarily be better off price of $300. of the four main categories of electrical and as a result of the extension of the 11grace (2) All raw materials are purchased electronics goods will be restored to 17% period11 of the NTNR Policy to the end of locally at cost of $200 (excluding (i.e. as same as the VAT tax rate on such the year 2000. VAT). goods). Undoubtedly, this will be good news (3) VAT rate is 17% and VAT refund for the New Enterprises which export these Using more bonded raw materials and rate is 9%. kinds of goods. For the export of such goods, reduce locahpurchases? (4) VAT paid on purchase of the raw since theVAT refund rate equals to theVAT Under the ECR Method and for goods materials is $34 (i.e. $200 x 17%). tax rate, the NCR amount calculated in whichVAT refund rates are lower than the accordance with the ECR Method (please VAT tax rate, if the required raw materials VAT on domestic sales $0 refer to the formula in Part B above) becomes are available at the same cost in both the Less:lnputVAT $34 zero. In other words, the full amount of the local and overseas markets, one way to Less:NCR amount ($24)* input VAT paid on these export goods can reduce the VAT burden to the New _1_lQ_ now be refunded to the exporters. Enterprises is to utilize more bonded raw VAT refundable ($10) However, the Old Enterprises, especially materials sourcing from overseas. * NCNR amount for those with most raw materials purchased As shown in Example 1, the exporter = ($300 X (17-9)%) in China, cannot benefit from the increases ·will in principle payVAT of $8 (i.e. 8% of = $24 inVAT refund rates because they abide by the added-value· of the export goods) TotalVAT borne by the exporter the NTNR Policy. In fact, as theVAT refund although all the raw materials are imported =$34 -$10 rates increase, the difference in the amounts under bonded treatments and all the = $24 (8% of the F.O.8. price of export ofVAT borne by the Old Enterprises and the products are exported. As the enterprise has sales (i.e. $300)) New Enterprises operating in ·similar not purchased any raw materials locally, situation is widening and the Old Eriterprises 1 there is no input VAT paid and the total creditable because the export sales are export products will be comparatively less VAT borne by the exporter (i.e. $8 in exempted from VAT. The $34 will be competitive. In Example 2, if theVAT refund Example 1) is lower by $1 6 than that borne charged to the Old Enterprise as its cost of rate is restored from 9% to 17%, i.e. theVAT by the exporter only using domestic raw sales. Therefore, if raw materials are rate equals to theVAT refund rate, theVAT materials (i.e. $24 in Example 2). sourced locally, the amount ofVAT borne to be borne by the New Enterprise which With regard to how much of raw materials by the New Enterprise is $10 less than that uses the ECR Method will be reduced from should be sourced locally and how much to by the Old Enterprise. $24 to zero. However, the amount ofVAT be imported, it varies from case to case and 1Jtl q:i , tE ii � �J JJl3: f4 ITT ii 1t fl 1¥¥-! B"J tJrit � l±l i=i ±�� ITT ffi fJt � r 1* (fftl =l r � , , filJ rt: it � �1l rt; r · lJrit �s{:J ±1\H11 fJl � tt it 1:tt§ m m ± ttit m mi: 13{] $24 � � $0 ° -ar¾ - m -- tl:lit�B"J�W * IP] m 11 s{:J� it � :J, $1 o 0 fr 1 � 1.!/&illJ � iliUl 13{]� it�139 ±� 111 ;9j &r , lli AA fJ" i��m q:i ii j[j:m � fen�: tJt � tt* rt¾ $34 ° m � , fJrit * 13{] JE1f.?Xt��if�{5l£ 8bs{J t:l:l ill;fil$Ll i=i (1) ±��� l±l i=i , �l*fU�� $300 tt it m � tt 1g- 1:�� it � :1> $34 (JJl3: � �9Uf tt �z� � fJ" rm t:l:l i=i it �ITT tt 0 (2) ± if�JJl3: f4 tE ii m� BR , 1ft ,;t � 9% illfJt $ l1ft • � $1� O) 0 Yr Ll · tE A q:i ' s{:J fJ" £ 1=1"'b (.:E. J�>eL!'r!i �I i'Jl!t 1,U.ft $200 (� § :J% ±t ffi fJt) m iw m T , � it * 11 1� fil � • fi 1:l fm· �=H.&�r£1=1J:1, mM-IJ"t., 11 (3) ±t {11 fJt$ I 7% ; fil fJt$ 9% 0 r � 11 �fil J � � � 2000 1f ® , � - '.iE IHI � ff 1!UiH� Q9 * £ 8b) s{Jill fJt $ (4) JJl3: t4 s{:Jtit .ri tJt fili $ 34 (ElP $ 200 x fw"��-100�it��*fJ-Jf&o O J! m � � 11 m * 7J<. f it t* m r � - 17%) 0 1! � � m m � fJt tit i=i11 t4 m1 l1u1 m • illJ It 11 t:l:l i=i��m iff if11=1 s{:J � it* Yil�BRm? :tct ,@, 0 t:l:l i=is{:J �!Im fil • fr JG , Jtt , filJ 11 , tE � � JrHrm m rnm � i� � !Im ITT i� Jl fili $0 r m m a� fJt$ � JJl3: 1!/&fJt $ , � 1�, tlt, filJ m f fet 1PJ »� �: tit.ri fili $34 � m * * r - * � �" w �r m IHi YdJHft • s{:J t:l:l i=i � !Im �-f' JG 1!/&, m �JJl3::Mt4:z:.ftt�t§ IP] tJrit*��y :ta:totPfilifils{:JmtJ�Ji�� (J!,;txz. �: �-f'�1J, tt ffi fJt � 111 · ;tt q:i - 100 n 1-! ¾ BR ffl if�{5l 0 5:\) , ZJJ' ElP¾ m l±l i=i m � � 1'ttto fP illfJt ���fJttit Q JJl3:;j,4o s"Jt§ �m tlPJHJt tJt PJ 11 ± il fil @l s{JfJt fili �* ftp fPLl- Yr ff, , 1ruUt ± if�JJl3: � � f.§.Jj-1flif, m�tl:l i=i��s{:Jill .JUQ_ 1ifJttiti=i, ±$���JGfJtl±l i=i, fJt$ , Jl!J * §t ;!; ».tA fi r� 1!/& � filJ PJ ill ii.fJt fil[ ($10) @ it* @: J'!U J: ZJJ' �Ji �J *� $8 13{]±� fi m �JfLft;1=l;¾LslHt4.:l:.�¾ �MB{:)� (ElP tl:l i=i � tm±t ffi $ 15l B"J 8%) 0 m � it�, m��it�l±l i=i �!Jo/JB{J±�ffi * � -f' JG1.!/& , 11 to fPfil fJts{:J fJl 11 it*[zs]�ti�BRffii!�@:;¥4, ii1� fJt � t:t tEt§ IP] ffi rt; �fl= 13{] iJr it fffl � ti tit:I]: tt ffi f,£ 0 Jifi Ll , ±�ffi fJl tt * = ($300 X (17 - 9) °lo) t§ it tE :t� rWi ill tJl iw � Ji!e J! ,t� Jrl. ti ($8) � {Ptl = Jifi ffl ii � @: * � * = $24 ff, t* r�Ht�1�Tm��it�s{Jtl:l i=i ;¥4s{:J ·� bL ($24) $16 (ElP $24 - $8) 0 *· tl:l i=i s{J 111 fJt r y O it *� tl §� fJ t:t :tm tE 1jtl s{:J ·� t5L q:i , * *-� � tt � Ji� lJTit � $ JJl3: t-ts{J � BR * = = $34 - $10 m &r � ¾ fil fJt $ ffE 9% 17% (ElP W m � � = J1' 1:t fPtl f!U � tJtf fJ" rmit s{:J � a ti * 0 1!/& fJt$ t§ �) , Jl!J BR ffi 1�, tlf, illJ $24(ElP t:l:l i=i � 1¥ fl ($300) s"J 8%) t£fP;1=/;lffi*75Jl����JE 36 The Bulletin February 1999 r= TAX very much depends on the particular From the above examples, generally circumstances as well as the business Example 3 - With only local sales and speaking, the New Enterprises may prefer to considerations in each individual case. local purchases utilize more bonded raw materials and Assumed: maximize the local sales in order to reduce Is it better to lower the export ratio? (1) All products are sold locally at their VAT burden in view of the fact that VAT In general, if the goods can be sold at price of $300 (excluding VAT). refund rates are still lower than the VAT tax the same price in both the local market and (2) All raw materials are purchased rates for most goods. In spite of this, the overseas market, the enterprise may try locally at cost of $200 (excluding enterprises should take other factors, such as to maximum its local sales, subject to the VAT). import duty on imported raw materials, prescribed export ratio, in order to pass on (3) VAT tax rate is 17% and VAT consumption tax, quality of raw materials, the VAT burden to the customers in China. refund rate is 9%. export ratio requirements, etc., into In Example 3, as all products are sold (4) Input VAT paid on the raw consideration before jumping into a decision. locally, the VAT will ultimately be passed material's purchased is $34 (i.e. on to the end users and the VAT burden to $200 X 17%). D. Conclusion the seller becomes zero. As the VAT refund rates are lower than VAT on domestic sales $51 For the New Enterprises, as mentioned the VAT tax rates, and the base amounts for (received from buyers on top of the previously, if the VAT refund rate on the calculating VAT payable and VAT refundable selling price) export goods can be restored to the same are different, the related input VAT may not Less: Import VAT $34 level as the VAT tax rate, the VAT burden be fully refunded to the exporters, which in to the exporters can be reduced to zero. Less: NCR amount N/A most cases would increase the costs to the From this aspect, the New Enterprises will ($34) exporters. In the long run, this may slow down be indifferent as to whether the goods VAT payable $17 the pace of foreign investment in China, and should be exported or sold locally because Total VAT burden to the enterprise thus adversely affects the fiscal income and the VAT burden will be the same (i.e. zero) =$34+$17-$51 the economic development of China. In order in both cases. However, in respect of the (VAT received from buyers) to encourage foreign investments to China, goods which are subject to a VAT refund = $0 to reduce the cost to the exporters and to rate which is lower than the VAT tax rate, strengthen the competitiveness of export if the goods can be sold at the same price exporter is $24. In Example 3, as all the goods from China, it was reported in January in both the local and overseas markets, the goods are locally sold, the VAT burden has 1999 that China had decided to further raise New Enterprises may wish to maximize the been passed on to buyers and the VAT the VAT refund rates on certain categories of local sales, subject to the prescribed export burden to the enterprise becomes zero. This export goods (VAT refund rates on some goods ratio, in order to reduce its VAT burden on effect encourages FI Es to maximize their have been restored to as same as the original export sales. This has been explained in local sales, which is inconsistent with VAT tax rates). It is hoped that the China Examples 2 and 3. In Example 2, as all the China's long-established policy on government will further increase the VAT goods are exported, the VAT burden to the encouraging export sales. refund rates for more and more goods. ■ it '1% � Y >1b &i'J Jm t� to r3g& i'J fik � � iUJI :1c rg i� tt fJtl � � t�• ffi W E � 1i i'J? ( fJtl -=) [7g P-1' [7g i� rti ,� � , � � w r:r � n JVJ >1r ffilm � fit1t • - !ffx w 1§" , � ¾ �af.J � >1r&� [7g&/1j 1E¾ �Jt *�Jitl:l w�tmsf.J-��ffi::ft��o f�HI tlH�1 , it * PJ il :i: t1JJ: 1Llt iff PJ (1) � if�� � rg i�, ii§ ff fl ;t� � :fit � _t � 1ml fftl r Jiff Jt , - � * af.J�rg&i§ffttffu, m���rg /1jaf.J ifi 1t *1£ ,fR,, :tff, llJ ffi & $300 (� 'EL t! f1t{ {1[fJt) 0 m z � fi & , t� t� ffi tJt ji_ bid$ � � � rg� �- rn�•m*•�mm$, lzsl�• (2) � $ ®: 14 1:E � rg t3R R'1 ,ftx:7-Js: *, � � y 1t * § af.J 5t t� 11r rJt t@ ·� tE�JitB Q��ITTrftffl�$�miil=l ;%$200 (:;f 'EL tis t� m m) tt O � :i" tu -= 0 :¥414�ti:k��rg &�, � �yt�ffifJl 0 ft fJtl -= r:p ' EEi]J('� if�� t?JJ lg � [7g (3) i'IWf>t ffi $ 17% ; ill_fJt $ 9% rti.t@�� 0 m1t*%�75J'.1Jtfmlzsl i�, t�ffitJtM;Jrn��J'f*�W, !Yr (4) ®: *4 rti iifJl JJi n $34 o�P $200 x * , fftl �P ii l=l ®: J¥4af.J �HJt , r� JUJt , 0 0 � ii§ff ::0 f1t{ffi fJt � tJi � � O 17%) ®: J¥4af.J 1( � • [7g >1r&� t� fJu �1uM � IHUl ffl I fR, , :tfl>illJ 1¥ � af.Jifi 11:: * , � ¾ ;rt tl:l l=lill �rt! f>t $ 51 q� [7g&� � � ftJ ii§ JJif>t fill $ 51 T.�i* m� 1�U$t $ Jt -1fZ-, J:lU a�tl:l Q1t* t� (loJ Ji 1i >1r 4� I!R) lE a:i EfillfJt$fr£EtarJl$�&tt It lzsltlt, :;f��� * a, illmrti£•:;f� .��iiJJim&::f mm�w����; � : ii J]lf>t fill $34 t?JJ ¾ >1r i� ¾ rg i�, tl:l Q 1t a� t� m tr � •ill. @l tl:l l=lit* · Tm lH!�)Uo T tl:l * �: �-f,fR,{l, m jJ_ ttm wt¾ - -rt (fAJ � �) , ife 1t* 11 Q 1t � af.J b:X:* . ffeJ!* fill-ar !� � �ui >1r � w � � 1a: Jtt1t1 11rrJt � w w� m ;rt [7g t!f fO -fp ill.fJt �rit•r:r�rtiii�,:f!Ew�•r:r-�m >1r&/1j tt fJtl O 11L� , !1itt 1iU1H$tfr£ $ Jif 1l af.J fJt n :;f � m rt!M��A�&�VM 0 ;%T::f-�r:p rJt * af.J� �, 1E¾� >1r i� »..[7g i� (:;f 'EL ($34) - � m a� $ rJ i; JHr ,�Hx • a� m MrL , � 1% t1t1 m m) af.Jff 11 t§ fA1 , #JUtn1E, M;J* $17 � �ff£ r:r � tl:ltm l=l� af.J px; 7-Js: , t�fftE 310T )Pr l/§a�� tm ,i ;% rg&� , M� PJ � 19991¥-1 Jla��l§Uli� , r:r��mlk:5E y {t * rt} f� {1[f>t � tJi O � PJ :fittt � {ftl 1t a� t� 11r m t.!Yw � W�tJ1�$filJi�rtltl:ll=lillm$(�rtl O * = »..ffu -= t�rti m m -� � w ;i- tl:l ftffu = $34 + $1 7 - $51 r:r ,Et rn � tm � i� >1r ii§, t1t1 m fJt 1� �!i�m•It•m**�, mm tl:l Qaf.J 1t * � :fit��•wtm�to w si Jt tl:l Q = (loJ Ji * 1& ltla� i� JJ[ f� ffifJt) w , � tJi F,li $24 , {g ft fJtl -= , E8 fit� � � ff�rtlft¥�h 0 ��r:p��m��� 0 = $0 0 ■ if�rg ii§ , f1tlffi tJt 1� �W .J:lU � � >1r ffiJ @m•mm$rti!i��-�--:k I lffiflJ ,El 1999- if 2 fa.I 37 CRIME RATE 1998 �, � !-tJt. Economic crime up slightly, but overall rate still low ong Kong's crime rate remained at the recent economic downturn, certain kidnapping and counterfeiting cases a relatively low level in the 1998 crimes could. "Property crimes such as conducted during the year. calendar year, despite the adverse pickpocketing and snatching, as well as "Despite a fal I in the quantity of drugs impactH of the East Asian financial crisis on criminal intimidation with i I legal debt seized in Hong Kong, substantial quantities the local economy. collection overtones, are undoubtedly of drugs were recovered in other parts of In a letter to the Chamber last month, attributable to the economic situation," he the world.·as a result of our joint the Commissioner of Police, Mr Eddie Hui said. investigatio'ns with overseas counterparts,11 Ki-on, said the Asian crisis and the sharp The Commissioner's figures showed he said. downturn in economic growth had made that the overall number of crimes "M oney laundering legislation 1998 an eventful year for the SAR. committed last year increased 6.8 per cent continued to be used effectively during the "Hong Kong nevertheless fared much to 71,962 from 67,367 in 1997. The crime year to maintain pressure on triads, drug better from a policing perspective, with rate (the number of crimes per 100,000 of syndicates and organised crime groups. As 1 crime remaining at a low level, 1 he said. population) increased 3.9 per cent to a result, $379 million in criminal assets Mr Hui added that the decreasing trend, 1,076.1 from 1,036.1 in 1997. were successfully confiscated and a further which saw crime fall to its lowest level in The biggest percentage increases were $187 million frozen pending confiscation," 24 years in 1997, levelled out during 1998. in firearms seized (up 63.6 per cent), he said. "Although the overall crime rate and criminal intimidation (up 51.2 per cent), "Just as I pledged before, we have violent crime rate rose slightly by 3.9 per pickpocketing (up 39.5 per cent) and bank continued to police Hong Kong throughout cent and 3.8 per cent respectively in 1998, robbery (up 62 .5 per cent), although al I 1998 in exactly the same way as we have violent crimes such as robbery with robberies rose only 7.7 per cent. The biggest always done; fairly, impartially and firearms, homicide and serious narcotics declines were in kidnapping, homicide and professionally," Mr Hui said. 1 offences continued to decrease," he said. serious narcotics offences. 1 As far as I am concerned, the only way 1 1 1 At the end of 1998, Hong Kong s crime Mr Hui said that throughout 1998 Hong in which the policing of Hong Kong will rate was considerably lower than in many Kong continued to enjoy excellent co change is for the better, as we strive to 1 other metropolitan cities. 1 operation with the Mainland and overseas provide an even more reliable and He said that whilst the general increase law enforcement agencies, a fact illustrated transparent service for the people of Hong in crime could not be directly related to by a series of successful drug trafficking, Kong.11 ■ • r.� I2 �·N � � tlflt j;iJJ , ;;ttU� � � 413'-J l,036.l *:t��1,076.1 *, ��j� � fill : 1 JI �o � i #,fil ifdt , W�ft f ,t , {§. 1 9 9 8 !if 13'-J !UU�$-OJ� � »t 3.9% 0 1998 !if.fHl�1-i-J{B"Jnit , �0f · 0 tHbJcijZ- 0 ��-XB"J#�*�:•**�13'-J�# JEfoJJ�s"JiJ&HIU!r!r � w r� � Jk'&m: -R m � .1. J=J �tEJ* 1W tl@ (63.6%) · *Ll$��- (51.2%) · tJl� (39.5%) 1���Jt,7Jftl9�9.1Wffl�ffl�* l±l , I:i:t3+li!t�t�afo 1998!if#Jll.�±i-&1Ut iotH=rtttJJ (62.s¾) 0 , matt��9. C rtw ffl�n���,ah�wmm�•�£PJ 1 F ) �tll@JIA$$z.tk13{J-4 ° i'IW1WT 7. 7% 0 jj\��M-::k13'-JW�:¾Hn�. •A � · ��Bt£�13UH! 0 J ■ �HJt: ,rtrm,wmftt15�nOOW* foW•rflr�Hs"JM:m:#fi m�#,W�-'¥fil ■-� 0 J�X* �*m, �ft 1993 !if, 120 ¥:1r-�o!2,tf1WtkJti!!lJt.iHJ:IJrttl, m, 1997 !if13'-JW�$r�� 24!if*B"J• 2250 0 rtt1H-&t1t•r�,, 100 1US; 1998 !if,W�-'¥fil-OrHtti5E 1!E!iftklmtw 7 1m : r-ttr& 1 998 !if13'-l i • 1!/i�$%UR=lit.n�fo{{��� · i tm m ,u� � o 2000 jJW�$5HIJ1tHt- 3.9% fo 3.8% , {!'H�� {lf -:!}I 0 PJ Jt tl, fi��-h#fi·•A�W-��NB"JM 1m f.ffi. : 1 filtf't ft ;;t±ii!if.ft 1750 * r- Cl £#fi�HHJU1@;:9 ° 1998411 'wms"JW J!U"J=ll rflr @ ■ I I •:a�y , ES»i I "' I -r\ Q- 38 The Bulletin February 1999 GOOD CITIZEN � rp � � Good citizen stops burglary n the afternoon of July 26, 1998, 0 four premises in an industrial building were burgled. At about 1455hrs, a security guard saw two men li ttMjf � 1P R emerge from the first floor car park carrying plastic bags and a knapsack. 99847 fj 26 Srlf, �I�:.k/t 1 O Looking suspicious, the security guard rm11ID � {fijJJttA.A§HlHI * Mr(f attempted to stop them. As they dashed out rlf=atn+n5t, -��frjt'i=:� of the building, the security guard chased m � � r:(f * Jt-tts� 1, ll::rw � fi J§= and managed to catch one. 0 mn��fQ 'W� • Mr Yu Tat-leung, aged 46, happened to l�ffi��r*lb¾-PJM '�frjtii\: be driving his taxi past the building and saw lil:i'B1m1r��1f O ffiAJl&P�ft��JE the pursuit and realised what had happened. Mr Yu saw one man run across � ii jt&Mi JE � m , snz TIJtl B!Ut: q:i- the road so he drove his taxi up to him, A 0 intending to intercept him. Before Mr Yu s�±RJtJHz�� (46�) �i�__t could alight, the man boarded the taxi and ±Jr , § Htfillti'IB�;f1[ , snz;g JL� -A� told him to drive to the KCR. Mr Yu initially 1i�ffi-�Ri , J1t¾l;s � ±iil:lilffi!l� , complied with the instruction, but later With the support of the Hong Kong 1_E3_� ?i ff T lL , !J� � r:JBt __ta� drove the man back to the scene. Realising General Chamber of Commerce, tfie Good Jl;}Pft�iill:1i:kll:Y:tt O �JHJJ{N Mr Yu 1 s intention, the man fled once the ± , Citizen Award Ceremony was held on ilHilHBll:-�@ 5t §IT fill;g � taxi had stopped. Mr Yu alighted � � � , * December 2, 1998. Dr Eden Woon, O immediately, and with the assistance of a �•mn���:11M1rS tJ��r�#x , Chamber Director, presented an award to 0 Mr Yu Tat-leung, taxi driver. passer-by, subdued the man and later 1ttftJErm� �:s'z:.atrll:, w-�� handed him over to the police. Some A�g� -=fifftl H� 1m , Ed&:#% Jt x-f-Wn � t:!WrlH�.1!UH.t��J S:1-ff5tHt�•tfll)J , ht1998 1¥ burglary tools and property valued at m O WJJtf�-@riJHJI� , snz,ey:@l 12�2B.fi 0 �•*•�--�--±•��ff$ HK$240,000 were recovered. ■ f.t�rn24 �m:5r;Ji:Hm O ■ ��3!N_o Theatre / Exhibition and Conference Cent e AT 22/F United Centre, 95 Queensway, Hong Kong (above Admiralty MTR Station) Suitable for : Exhibitions Meetings In-House Trainings Sales Presentations Press Conference Workshops For details please call 2823 1205 / 2823 1246 Room Rates :- Chamber Members get 20% discount �onday - Friday Theatre/Exhibition Conference Room 1 Conference Room 2 Committee Room- Seating capacity 110 seats (1,300 sq ft) 40-60 seats (830 sq ft) 15-30 seats (470 sq ft) 5-8 seats ( 135 sq ft) $840 --09:00 - 17:30 $8,100 $5,200 $2,950 --- 09:00 - 13:00 or $5,600 $3,600 $2,000 $580 13:00 � 17:00 -- Extra Time Per Hour $1,540 $990 $550 I $160 Includes - Overhead Projector, Whiteboard, Reception Area, Slide Projector, TVNideo recorder and Self-service Cate Bar Itffif-lJ � 1999 1¥2 � 39 CHAMBER STAFF PARTY Staff Delight in Modest Christmas Gathering n line with the harsh economic environment, the Chamber refrained from its usual gala Christmas dinner this year and decided on a far more low key approach by holding its annual staff party in the new °Theatre facility at its head office in the United Centre.I A delicious buffet was enjoyed by staff and participants took time out to enjoy relaxed chat and informal banter with colleagues. Chamber Director, Dr Eden Woon, congratulated staff on their hard work and announced promotions to star performers: Emma Ho - Senior Manager for Human Resources Joseph Wong - Senior Manager for Information Technology Poon Yuk-chun - Customer Services Manager Cynthia Chung - Assistant Customer Services Manager Poon Ka-kin - Assistant Customer Services Manager Ellen Liu - Assistant Manager for China Wendy Chan - Information Technology Assistant Amy Tse - Administrative Assistant. Certificates were also presented to retiring employees in appreciation for their long years of dedicated service. The finale of the night was the Lucky Draw, thanks to the generous donations of our Ms Trevina Suen, PA to the Chamber members. The Grand Prize - two business class roundtrip tickets to Australia - contributed Director, is presented with a gift by our Chairman Mr Peter Sutch, went to Eva Tong, CO Division; Once again, many from Santa at the annual Chamber thanks to the members who made it happen. ■ staff Christmas party. Many thanks to those members who kindly contributed gifts for the Lucky Draw: The First Ten Prizes: Two Business Class Roundtrip Tickets within Cathay Pacific Australasia Network - John Swire & Sons (HK) Ltd $3,000 Seibu Gift Coupon - Manhattan Garments (lnt'I) Ltd $3,000 Cheque - Dr Eden Woon Two HK$2,000 Royal Park Chinese Restaurant Coupons - Sun Hung Kai Properties Ltd 3 Sets of Philips Haloplate - China Light & Power Co., Ltd. Steam Jet Oven - Chen Hsong Holdings Ltd $1,000 Cash Coupon - Bank of China, Hong Kong Branch $1,000 Cheque - Eralda Industries Ltd $1,000 Cheque - Sun Hing Shipping Co Ltd HK$1,000 Pizza Hut Coupon- Jardine Pacific Group Ltd (c/o Pizza Hut) Other Prizes: Alice and Law Co Ltd Nisha Electronic Industries Ltd AXA Investment Managers Hong Kong Ltd On Kun Hong Ltd Che Wah & Company Orient Overseas (International) Ltd China Everbright Ltd Peninsula Knitters Ltd CKI Materials Ltd Robert W H Wang & Co Credit Lyonnais Securities (Asia) Ltd Scarfell Enterprises Ltd Ernst & Young Shui Hing (HK) Ltd Fanny P Lai & Co Certified Public Accountant Shui On Group Ltd GML Consulting Ltd Standard Chartered Bank Economics Dept Harilela's Time/system (Hong Kong) Ltd HK and Shanghai Banking Coproration Ltd Tradelink EDS Ltd Hong Kong Telecommunications Ltd Wharf (Holdings) Ltd Jardine Matheson Ltd Wing Han Trading Co Ltd Lippo Group Wing Tai Exporters Ltd Mr D W M Fergusson World-Wide Shipping Agency Ltd N M Rothschild & Sons (Hong Kong) Ltd Yangtzekiang Garment Mfg Co Ltd 40 The Bulletin February 1999 , &-*v � H � $ :@] ID# 1•• &!fr �-��-�-----��SS�* � �����M��vwvw�= )mn Q Q Q Q � '-Jl Q Q Q '-._ IJXl' ·= � ����-�V ·····4iti·���V � � lx � )l]Ilf � � � � TT Mi �, -Bm H -100 �'§HI ooooli��ooor >-r �!Ilm•�--���-m[�illE!?dE � I -\El� illE!?ffi-���� I I I I I I I I ��wet� � mif • *lllf tll!* h- )IIIlfill$- �� fM 2% � � Jfrt � � � � � � ** � I I �\ I I I l �l * ; Ht- ! � ��=!'1 =!'1� � � � )nn% >=- · · m:&- �* � � ';<-; ar- � � � *t� � li =$'. � (-Wr )Illl%� II >+ � ·· &��� ;W����:@] 1 � H :iht � :ihtill$- � Jfrt � � IJ1J) �� '-N � t'> t'> -= v� ����m)l\m)l\-��*����*�Ht- � �mmm������ �� - m1> �=*�mm������ ��I �=$'.-�$�EllfffaEll t!�>�>�>�'-'�t�>�� ,:::.. Bs:: i5jj � c::!- c::!-1jlllf � � � + ,WJ� xu.r r- Eat �MM� ��MII11� .. V -111: "--'- � * �� IDA\ "--'- = fuli'-'i"i "--" ntt --ri>l TTf-lJ I � film $ fffa fffa � � � ill ill ::s£'.. v;,- xi:u v;.,- -a( v;,,- -=illj r .LifP � �lli! �IHI � I � �IHI )an�;! . = \mr-..� --� --� --� Lu -� --� � Ell ::{, Ell ::(, � EU � � i;;§ � � f-fr � F�liEltl* CD � CD � CD lilt -ffi h N Il�� :m � llffl ....,::. � CHAMBER IN ACTION Chamber gears up for New Year .., espite the onset of the Christmas-New preparations for the annual meeting in INTERNATIONAL BUSINESS Year holiday break the Chamber was April, ensuring a busy first half of the year DIVISION kept busy during the month under for Members. Dreview planning for the year ahead and Trade Committees answering queries on the current state of the ECONOMIC AND LEGISLATIVE economy and the business outlook for 1999. AFFAIRS DIVISION China The year ahead is certainly going to be a Like the Chamber as a whole, activities On December 18, more than 70 challenging one in all divisions of the within the Division were affected by the members attended a Roundtable luncheon Chamber, with the economic and business Christmas-New Year holiday break during the on 11The enfo.rt::ement of the 'exempt, set uncertainties far from over, both locally and month unde·r review. The Division was off, refund' method for the calculation of in regional and global markets. nevertheless kept busy answering media and value added tax (VAT) applicable to exports 11 The tone for the year may have been analysts questions on the economic and by foreign investment enterprises • Mr already set with some concerns emerging business outlook, meeting with overseas Vincent Lo, Partner of Arthur Andersen, about business conditions on the Mainland visitors, preparing The Bulletin and other explained in detail different calculation and Brazil's economic problems further pubI ications, and preparing for the challenges methods and their implications for foreign unsettling the global financial markets. of the year ahead. investors. Locally, the SAR economy continues to During the month, the Chief Economist A 10 -member delegation from show signs of weakness and although lower met with delegations from the US and Europe Guangdong General Chamber of Commerce nominal interest rates will help things to discuss local economic conditions, visited the Chamber on December 30. The somewhat, it is clearly going to be a difficult conducted media interviews and attended the delegation, led by Mr Lin Senquan, Deputy year. Executive Committee meeting of the Hong Director-General, United Front Department To keep members ahead of the game, the Kong Retirement Scheme Association, of of Guangdong Province, met with the Chamber has begun already organising events which he is a member. He also delivered a Chamber Director, Dr Eden Woon. aimed at shedding some I ight on present speech to the Hong Kong Society of conditions and the immediate outlook. Accountants on the regional financial Europe The Tripartite Forum on the services situation and the outlook for the HorigKong A Moscow mission led by Dr Eugeny sector was held and the United States economy. Egorov, Minister of the Moscow City Consul-General, Mr Richard Boucher spoke Government and Head of the Department of to members on the US and regional Committee Meetings Support and Development of Small Business, cond ltions. There were no committee meetings within visited the Chamber on December 17. The The Government's Budget is just around the Economic and Legislative Affairs Division delegates were briefed by Mr Manohar the corner, being scheduled for March 3, just during the month. Meetings of all Committees Chugh, Chairman of the Europe Committee, two weeks after the Lunar New Year break were, however, scheduled for late January - and Mr Sidney Fung, Assistant Director for (February 16-to-18) celebrating the beginning Economic Policy on January 27, Taxation International Business. of the Year of the Rabbit. Committee for January 28 and Legal Mr Fung met the following guests during Other Chamber events are also well Committee for January 29. All will the month: Mr D Voveris, Ambassador of i n to t h e p I a n n i n-g stages, i n c I u d i n g concentrate on tasks for the year ahead. Lithuania, Embassy of the Republic of J:J=J :tJJ�».n11 � f�AA rdJ • * wr-tt n(' fffLl n Jlj�ffl:-�ePM¥fl±\1JJ,AABU� 01iJB 3 Wf-fi��···o)=J�,��wmwr1rr�0 *41TTfLl, _Mz@lffUH'l!-tHifil�Wtr5UP1ffi J=J 3 B (epJfUUfr!ij::f�AA (2J=J 16� 18 B) ft it¥*•�,%fiE�ITT�-ffiN&WmITT� �M'�l¥J�ITTIT 0 flffi�Ml 0 �M�o *�-a�.��½�1¥1•�����, tff , *wrifl&'it�n, �fm_t*!ij::�JJ lffi�M�_Mz*��A , lz§lltfl::z!s:wr�=g:mfffi , ::k�mj}J(filftgQJ=J {5HWAi1¥J@!ij::it�:xwr) , ����� � , ::z!s:!ij::M�¾!ttlt�'tis-(J-if 0 �m◊wrffif! oc�-f�fcl'® $*$�1¥J�4 J=J�•�$N��M�ffif!it.& 0 ��ffif! �i]�:t-fus"Jlffi�iHJ?5L_Mz*�fl' fmBWs"J •n�-�®•0wra,wrasAA�:•�� •��-���½��•m•&•��,�• m�ffif!wr ( 1J=J 27 s) • t�Jf�ffif!wr ( 1J=J 2s ${1:f:B51®6'rW�J:I,EBlltHH�, ::z!s:ifs"J*ifil� B) f0?!1t�ffilwr (1 � 29 B) 0 it&��� 1-i��P{iiJ, ;j;§fg!w-AB,C,,��lt0 MUu*!ij::s"J�JlI{1= 0 1:E*m, aritf{Mt��� , !iilrti;iUIJ$� -�i:r*it�ffm ) !jff�_t)=Js-(Jfr§l,bsHU� -��ffm,@M��iffil¾Mffm� 0 �R.5Ll11�M�W ; PJ ¾ , AAr�ifJJ@l�Tft� � T'l�wr�*J&Jttl, 1-Js:wriElf-=F-�t¥ ».a�%fi�flaritfffi-*OO•ITT�ITT!J,_Mzwr $JJl::k�mJJJ, •wrffif! T�ft;�s-(Jffej��fr:R. �¥Uwr6'r•• �fl= {I•J=JtiJ} &:lt1mt1J!lm �JIAAs"J�� �R.iJl1J�O{iiJ/Ji{1*4S"Jt:Jt� WmB��HITTf��-�JiE¾-� 0 J=J�, t'ffrt*ifil�**wrJe.*§�ilffi�f)H JJt6'r, �iJ,11miJMJ$§ir���ffi�ili/$lf1t s"Jf�*III, tf!J}z!!::zis:ms"J*l�'ttr£, _Mz${J(�� �Ii��� wr,mUz!!�ii».E�s"Jttt£ 0 ���wr,���ffif!�ffil±\/$Wmill�ITT�� 12J=J 18 B, Mi�7oi;itffif!l±l/$�fl±l 42 The Bulletin February 1999 Lithuania in Beijing, HE V Kuznyatsou, Ambassador Extraordinary and Plenipotentiary of the Republic of Belarus in Beijing, Mr Giorgio. Pellicelli and Mr lnnocenzo Orlando of the Salerno Chamber of Commerce, Italy, and a delegation from Dr Eden Woon, Chamber Director, the Undersecretariat of Foreign Trade and presented his views on policy Exporters Unions of Turkey. issues relating to e-commerce at The Division organised a Roundtable the Sing Tao Electronic Business luncheon on January 12 at which Ms Nancy Seminar. Kontou, Member of Sir Leon Brittan's Cabinet, European Commission, gave a ■--�•M±ttr�k�-������ briefing on 11 EU's Pol icy on Anti-dumping k�a��Jmtt•k•����-•�• and Other Trade Measures". Members were a'g•Jt 0 briefed on changes to the EU's anti-dumping legislation. Hong Kong International Mr Kumiharu Shigehara, Deputy Secretary-General of the Organisation for Economic Cooperation and Development Mr Manohar Chugh (right), (O ECD), met Mr Peter Sutch, Chamber Chairman of the Europe Chairman, and Dr Eden Woon, Chamber Committee, meets Dr Eugeny Director, on January 6. Mr Shigehara was Egorov, leader of a delegation from briefed on the global financial crisis and Hong Moscow on December 17, 1998. Kong's approach to dealing with the economic turmoil. 1998 1¥12 � 17 E3 , il.:2Jtl��-:i:Jt)tiffi-tR On January 7, Ambassador Stanislaw (�)•Jta�M���ff••�n�Mt 0 Patek, Head of the Swedish Delegation to the 113 Textiles Committee, Ministry of Foreign Affairs of Sweden, met with Dr Eden Woon and other interested members to booklet contains detailed information about BUSINESS POLICY DIVISION discuss textiles and clothing issues in Hong the conference agenda, social events, a post Kong. conference tour to China and the two post Chamber Business Policy conference symposia on intellectual property Pacific Basin Economic Council rights and financial services respectively. A wide range of business policy issues were The PBEC ICM 1999 Organising Registrations received before March 31 will considered by the Division during the month Committee met on December 23 and January enjoy the early bird rate of US$1,500 for PBEC including: Government SME policy, 7 to review organisational progress. members, US$1 ,700 for non-members. Visit Government housing policy, competition in The official ICM registration booklet has the ICM web site at www.pbecigm99.orgfor the exhibition contracting industry, been printed and is ready for distribution. The up-to-date information. liberalisation of trade in services under the □�ffi&W�W�·�·filJffi�J�M� Air�£fflfi±�■ �IIIMAMff•� 0 ir ���«• 0 -�,�mffi0�%�AB� �l�•ma21&���m}E�-n��o � � :i'i � 1HUt�� • n � , sl1z ?Hfr 100>1HJJ �o �)iii!���· �' iffi � iffi �ifk� 12 A 30 s , Jl*�-t�iffi•-rr-tA , ES 1A 6 B , #��il-ft&:giJIUEl..iLlf.:.i�.J:ir )=J�,�$��T$�ffi�iffi*�ffi.� Jl:wJey>1r�9Plli'Wf'mrtiLl.-fHrtJl]Jf.[�f.:.�iffiirlLl _5'?.*ir±�ff*mfP�-�lJ-1Hi±, Ji!UfX�3:* M�mq:i1J\�'.i£*�• • �mm��•• �1: •�*�••effi�•W*•••a��m± ��ttE;��-�R& wm�11t���ms{]ffi� 11 0 0 1� 0 IA7S�if,�M-ffflI��m� •1-r�&��;[•$� •�•�•fflmtt� ��l1¥ifs{J�tfc1MltrB&Gpfffl) PJ1:ttil q:i ,t:,, )Jj}J/&3:� ti-¥ - 11:EE! f.\iPdi. ft. s{J lilf. I iffi,�ffi���M$jc��--·�ffiBM�J=J�,m�••�•••wT�*•• �i O 1J\$r!/1tffflit�Mf1UPtsj}J '.iit4 , slfzt'tif �o ��M¥7C�$Ha��·•*�•��iffiir ir���q:i���ffl��BffiM�Mir&�R 1i:*1'-liJta%1JfP�]I$· ±:i=i:JtW�ff�;:fPte □ B���Jfit-t-s{JfJffr- 0 tE3J=J 31 s rwl�1'5 , PJ@l iffi�gpit#Jlnlts{J1i:%zlll 0 ¥tJJIH\U! 0 J�.J:irifA1:fflh$1,500�7G ' JF O 1 A 12 B , t_Mf�:$:fHR.'&Htt & f@ii�&� ifA�$1 ,700�5'c fiX�PjUk�m., !iifrJW:� I�&�tt��� J 0 JH�iMs{Jlf&Jt 11\��•· , EBilX21�13'H� �f4if#$J& ( www.pbecigm99.org) 12 ,R 16 s , �Air�fi1Mt!Lf«•, � IifffWflJ 1999' 1¥ 2 � 43 CHAMBER IN ACTION wro,regulation of unsolicited email, strategy applications by speakers from Hongkong Promotion Unit and the Trade Development on promotion of franchising, and regulation Telecom. Council to discuss Hong Kong 1 s possible of Mainland China's tax system and retail trade Preparations were underway forthe launch participation in the World Services Congress of a homepage on the Internet in cd'hjunction scheduled for November 1999. The three Environment Committee with a pl'anned SME Week from February 5- organisations agreed to further explore the The third meeting of the Steering 12. The homepage was to feature video-clips merits of putting up a strong Hong Kong Committe·e on an Eco-Product's Award was of speakers, a resources page, a forum for the presence at the Congress. held on December 21. Members discussed exchange of views and an online competition. setting up a working group to oversee Housing administrative and logistical matters. It was Hong Kong Coalition of Service The Real Estate Services Committee decided that the Centre of Environmental Industries met with Acting Secretary for Planning Technology should take over the secretariat Environment and Lands, Mr Patrick Lau, from the Chamber. Tripartite Forum on Decemb�r 22 to exchange views on the About HO senior officials, business housing asp'ects of the Chief Executive1 s Industry and SME people and academics attended the second October 1998 policy address. A similar Tripartite Forum on the policy agenda.for meeting was held on January 7 with Industry and Technology Committee promotion of services on the morning of Deputy Secretary for Housing, Mr Andrew A Roundtable was organised on January 14. The Forum was opened by the Wells. December 16 at which Dr Orna Berry, Chief Financial Secretary, HKCSI Chairman Stanley Scientist with the Israeli Ministry for Trade, Ko and Hong Kong University Vice Brainstorming spoke on the experiences of her country in Chancellor Professor Y C Cheng. The s.econd brainstorming dinner of the moving up the technology ladder. The The subjects of discussion included HKCSI Executive Committee was held on 11 11 1 luncheon, chaired by Dr Lily Chiang, was competition policy 1 1 the quality of life January 8, hosted by KCKwok, HKCSI Vice 11 11 1 attended by 1 3 members. sectors , innovation and technology 1 and Chairman. 11 11 maki ng the non-traded sectors tradeable • SME Committee The Forum was re-convened in the evening Hong Kong Franchise Association 1 A training workshop on 1 Market and Sales at Government House, with the Financial Psychology11 was held on December 18 and Secretary as Chairman. Mr John Strickland, Forum on Franchising Opportunities 19 and 11 members attended. immediate past Chairman of HongkongBank, The HKFA organised a Forum on A special meeting was held on December delivered the keynote speech. Franchising Opportunities on Tuesday, 21 to discuss the drafting of a paper on SME February 9 during which eight franchise Policy which will be circulated to the General Services 2000 Study operators were to introduce their franchise Committee for endorsement before being An introductory leaflet about the study has systems and investment packages to submitted to Government. been published and is being distributed. The interested parties. They were: Agfa Express, The SME Award Organising Committee met consultant team from City University has Futurekids, Hong Kong Convenience Stores, on January 6 to select companies to proceed to begun work on compiling the "Handbook of Japan Home Centre, Paperus, Pet Kingdom, 11 the final round of judging on January 22. Business Opportunities in Services • Saint's Alp and Worldsites Greater China. A seminar on 11 Using Technology to This forum provided local franchisors or Manage Remote Businesses11 was organised World Services Congress master franchisees with a golden opportunity on January 7. lt was attended by 20 members A meeting was held on December 17 to promote their system to potential who were introduced to the various between the HKCSI, Business and Services investors. �u��-�$��w•*���±•�t� W��gW£1-t**'®'Wr1J�� 0 �*flt#fPJ-� ��f4ttaf.Jf.:,fil!tO ¾v.:�1t-®-m�JUJtw±tt ��M���tB�*ITTtt*�ili�it� 0 ff _ijf ';#,:13 !g'®' � t:B frt0 = JJ�ii 1J=J 1413 , #."J11O1.fziWi�'§f � · lffi�A± qvJ,�����if &¥�t:B�ffi=�,��-�J ,��*�� m�12 J=J 22 13 , :f:-iftjlJUt�� � Wr.J!ILlmm �� '®'M- 12 J=J 18 lit19 13 �1¥ 1 lffi�,t,JJ. g�ITT*� 0 M����·�������,& ��fib��fib�■•s•oo,x��fi��1r 0 0 ¥J If'F�, ;#,:11 !g'®'��:/J0 wm*•���•*tt���M-M ��•*���;��1J=J713,wm�fib� � � itJJ�12 J=J 21 13!f,Hftf ]jijif�, lffiit '®'_t it.sf.J � R1i>e1 :ti! : +-:lilt-¥� 10 fib�$'if1±.fi[PJ��� 9"11J\ ID! �W1J1�Jtit IOi sf.J• 1JiI1-t ; i� yt� *J • mi:.rijt:�uw]j1J J • ,jJUiJTlH-HxJ • O rttJM��£�Jj,rnm1tJ ��, Mo�EHtr ,'!'Afif •�%x���i1"��,w���mx�0 0 wJ m•mw���,�M����-ff�� it 1J=J3l3,�fi�-·-fiffi=v.:�•· 0 0 9"1JJ\it��Ulffi��itfi�1J=J613�t:BA _t,-9mfiMff�$•fflnV*M� �, EEMLl3::frtj�il�3::tf �1g•,•�-•ff•If'l=:��1J=J2213m fr 0 mHt�� 2000 � 1�Q1PJ��f�JJ.�1E��;f1fJ -�fj�1 J=J 7 B ftfilB iH!UtW£2OOO� J TiJfJ1'.Ifl=ITTiH1 O r *fr -®-_t , 201gt:Brrt�11ur:x.wm 1Jfl1-t� ji[sJHfBfP* ) �����JI O JJtj,� ) �m** ���;;:1)--fi3if 1riil11$r_w:�nrnrui 0 1iJfJt1MlliE:ii-=f�� u1g�� ��-=ffHD Sit�2J=J9B (£M=l$M��� ( 0 ��itif :if-=f.ffi ;(£ 9"1 ;j\ ru! it�� 2 (fu�l 0 ft1r�-®- it_t,A%���ftlffi*§ft J=Js�1213l ����� 0 ����A �§D����-*����tt� 0 �W �ITT-���· -�-�,U&m*�x tlt��&�Ji� 1-\: �*if ���M:��-��#�--�-fflB m•�ITTm_t•�,�•fim_t•��f'I= 12 J=J 17 13 , �§µ!MU�IlffiM!Ut�tiJl�;f� •� 9"1 'L' •wm-t • +-1t%1Jr.s • s* t�W 0 -�Jl�Fb�'®', lffititwm�W*�11 J=J tit � · ��m · !UnffWP�J;s · 1LlJ[t,JF* • tit 44 The Bulletin February 1999 OPERATIONS DIVISION Acknowled2ment of donations to the Trailwalker 1998 Membership Some 19 members and guests took part in -- 1998 fflfj�J ffll«**�• an outing at Clearwater Bay Golf Club on December 22 ..Chamber members were invited Mr Anthony Nightingale Jardine Pacific Ltd to subscribe to the Dinner Club for 1999. A �)E� 't�fo x 3¥� HIH�1 P.] new members' briefing, in Cantonese, was held Dr Lily Chiang Chen Hsong Holdings Ltd on December 15 and 32 members attended. �JUiJtt± Ai.lt:fJ�lH!i II 0 P.] Mr William Fung Li & Fung Group l�ll#.ifli ;flj��[I) Human Resources Mr Peter Sutch John Swire & Sons A one day training course on "Coaching r Ni*� wmx-s�1111 �Ji0P.] and Teambuilding Skills for Managers and Mr Liang Xiapting Bank of China Supervisors11 was held on December 1 6 with �VNl i:p�i!Hr¼1 l5H1· 10 participants. A one day training course on Mr Michael Dalton Robert W H Wang & Co 11 Developing Supervisory Skills for ��ffllx I 't1t�W ar!HI Tomorrow's Managers11 was held on January Mr Nicholas Brooke Brooke International 13 with seven participants. fflnHJt ili1:;tsll�!J&J�IDfr,,, Mr HY Hung Wing Han Trading Co Ltd Information Technology ?#1Uf 1i<.'t7JIJl JHH!i0 Rl A new section of Chamber News is now Mr James Tien Manhattan Garments (International) Ltd on the Chamber Web site. The section serves EB��f� 7-it��::& (il�) lH�0P.] as a bulletin board to give members brief news Mr Chan Wing Kee Yangtzekiang Garment Mfg Co Ltd items about the Chamber. l�Jukt!I; -!�JI�::&� Dr Hari N Harilela Harilela's Administration IlU*it± IlU*�lll There were 33 tenders announced by the Mr T B Stevenson Ernst & Young Government Supplies Department and 12 /ii[)({"/§ 1b:kit!Hilf$NNr Mr Johnson Hung Air Eagle International Freight HK) Ltd tenders for other Departments on the ( 1Lllit, �Jlfll�it� (w1ll MI.H�P.] Chamber Web site. The January issue of the Mr Linus Cheung Hong Kong Telecom Discount Club Newsletter, announcing 12 sfb:k# ¼1lffi:l!HH!i0Rl offers, was delivered to all Chamber members Mr Ross Sayers China Light & Power Co Ltd and listed on the Chamber Web site. There ��� i:/=1¥�.1Jlf�Ji0R] were seven Race Meetings during the month Mr David J Rimmer Rimmer & Co with a total of 389 participants. 7-it*m 7.it*wrWai!I$riYr Dr Eden Woon Chamber Director Events �i'�!ttf± wmt.tp;ljwrt�� A subscription Luncheon with Dr Tien Mr David Eldon The Hongkong & Shanghai Banking Corp Ltd Chang-I in, Chairman of Commission on >tfilU.X ¼1lJ:�IHBUiifi1HJi0P.] Innovation and Technology, was held on Mr Simon Lee Sun Hing Shipping Co Ltd December 17 with 120 participants. ■ :$:w]]Jf Jf"JTJ!!.fi�H·Jilf �&0 P.] Mr David Ruan AXA Investment Managers Hong Kong Ltd ��Jljl; ��:J5t�'g'J.lw�lf�&0Rl Wffl�*�• 0 •��-,*���*� DrY S Cheung Chamber Assistant Director -���-�M$����•***�B sfHlnttt± wmM!lp;ijwrmJ.1,t�� a"J�UJE Chamber Staff ,�@p;iji;tij�� . --...... , Total: HK$289,359 *t«!itfi 2s9,359= miff 5c I· ti,,. ,-; � t. -�$� The Taipan team proudly ., �'ifNJJt 12 R 22 B tE1l7Jc��R�H{J'U�Hf� receives their awards for l 0 $fiJEMi%!lil , n1.flfNffiilUfd$;1J□ :t!if Trailwalker 1998. a"J3288 l!ifJifNJJliEtl�fNffelffl1'5 ° fNJUHJ I • l*M�J tt�,j;: 1iHr�J �$ ·1 t'i1l if� � � (Ji*iiJ 1ft 12R 15 B�fi, :,tt:321'5-fNffi! epjljtf:l{l� I ,t,,�gi� 0 1±lll 0 .A.i1�5� �iRf-Ht 1fz Jdl!ttit lffi fN 1'J � 0 4--M tiJ a"Jtit {I• A 1 2 R rkl .:EJ1¥a"J JVII �JR� ff :tm "f *fN•���•lffi•Mm-■,�■lf& JJi O A rkJAlf-tlX1lJU�fN , $;1Jo�A389 * 1:ftD1ciJ!lwffe!IZlllfllfff$±i:f.mI1Hf fN�TM.rkJa"JiliJriJJ� 0 Ao .$J : 1998 !if 12 R 16 B $:fi , �M-:x, + 1'5�ffe!$JJD 0 fi� *�5!JJJ * 1:ftDfi:iJ:l{Hllf5r:�z��tn1.1tr-5J : ti@� fNt� 1Hf tit T 3 3 11mIE.!Vff *41# !Im ffl 12 R 17 B , *fN$fiti=-1t•, ��jUiJT 1999 !if 1 JJ 13 B �fi , �M-:x, -t1'5�ffi! �2z121lal;it1mUP� a"J�tfrj § 0 IjtijJHIJ 1999 � 2 J=l 45 Diary COMING EVENTS Dates Feb 26, 99 Joint Subscription Luncheon: Development of Electronic Feb 26. 1999 (12:30 - 14:00) Commerce in Hong Kong (English) Mar 2, 99 Joint Subscription Luncheon Roundtable Luncheon: "Hong Kong Visas: The Door is MrK CKwong, Secretary forInformation Technology Closing?" (Cantonese) and Broadcasting Mar 9, 18 & 24, 99 ''Development of Electronic Training Course: Management Skills for Balancing the Life of Commerce in Hong Kong" (Cantonese) a Career Woman Conrad International Hotel Mar 9, 99 (Enquiries: Ms Joe Cheng, Roundtable Luncheon: Taking Control of Business Property Tel 2823 1225) Outlays and Uncover Hidden Value (English) Mar 12, 99 HKGCC Spring Dinner 1999 Mar 12. 1999 (20:00 - 22:00) Mar 15, 99 HK GCC Spring Dinner Training Course: Effective Performance Management (Cantonese) Metropol Restaurant, 4/F., Mar 15, 99 United Centre, Admiralty (Enquiries: Ms Karen Au, Hong Kong / Guangdong Environmental Partnership, Tel 2823 1200) Seminar on Environment & Energy (English) Mar 15, 18 & 22, 99 Training Course: Corporate Financial Management (Cantonese) Mar 15, 1999 (08:45 - 17:00) Mar 16, 99 Hong Kong I Guangdong Training Course: Management of Business Files and Environmental Partnership. Records (Cantonese) Seminar on Environment and Energy Conrad International Hotel (Enquiries: Ms Karen Au, COMMITTEE MEETING OUTBOUND MISSION Tel 2823 1200) Feb 23 General Committee Feb 23-25 Mar 17 Europe Committee Chamber Goodwill Mission May 14-19, 1999 Mar 26 Americas Committee to Okinawa, Japan PacificBasin Economic Council Meeting 32nd International General Meeting (Regular committee meetings Mar 4-5 open to respective committee Chamber Working Mission to HK Convention and Exhibition Centre members only, unless otherwise Beijing specified.) (Enquiries: Ms Polly Leung, Tel 2823 1202) Website: www.pbecigm99.org 46 The Bulletin February 1999 r tl J:. ff IIJ:.lllDllJ iii 5 MJct:1,J,�fllltl:llllllliliWJR-� f!ffl 11 =f lB fl: ep � ,5.t2I-'-)(_7:7 � ililtTl4..t3tA �I1�P tl.PB��� ail!!'ft, �,J,1tlt..ttlAiiBi■ , 1,600 IQJBfl$llliJlfftiilil•tta rt:NJ:n c:::A.m) x; � ■1999 � 2 � 2a MEl:ltl J e3 iffi1ttt11J , iiJ �""Ffl11: J!��---..tflilatlJ • ���it!?,�� (Local Domain Name)��- (fflffi)!�500 ft) • � � � r i�ffifIHrUt �0 � tili�� B'91-tWG• ffl ( mffl )! �500 ft) at-�la.l�iiltm B • �� in��i2Jt ( fflffi)!�so ft) ■ • ���JLJ:Hl (fflffi)!�198ft)* • 1i fu:$1i-l"ERJmll ,�a1HlffU11Jil-lfJ (ffUl:GM ** • *••�s•m��ff�¥■,�Am�-§����•·100 s6Kbps 438 ;f;) - R@fflM�(�AffllftMtt�• �-7·����····••·•••r��ffJ••��-� 0 •aff•·•-���$·••· ���m�IUR•m��ffmHf� r ffl ffJ: J iii J:• l! 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