Saturday, February 16, 2019
Hong Kong must move with the times by making itself an efficient :: Economics
Hong Kong must move with the time by making itself an efficientplatform for Mainland financial intermediation.A number of journalists with work interests in financialdevelopments in Hong Kong asked for my interpretation of the movewith the times public lecture delivered by the Governor of the Peoples Bankof China, Zhou Xiaochuan at the Annual dinner party of the Hong KongAssociation of Banks on 30 September 2005. The move with the times mention was made by Governor Zhou in relation to maintaining the billet of Hong Kong as an worldwide financial centre.We should of course all move with the times and be alert to changestaking place around us if we do not wish to be left behind. Thiscomment has a oecumenical application and is particularly of import whentimes atomic number 18 changing rapidly. Those with the exponent to anticipatechanges and prepare for them stand a much higher circumstances of success.Those that carry on doing the same things in the same old expression wills imply be left behind. This is the reality.I obviously do not wish to quote others out of context or to stick wordsin others mouths, just as I do not wish anybody to do the same to me.But Governor Zhou delivered an important speech on a matter of greatimportance to Hong Kong - so important that it merited specialreference in Article 109 of the prefatorial Law - the maintenance of thestatus of Hong Kong as an international financial centre. And the HKMAdoes consider certain indirect responsibilities for this subject, derivedfrom the Financial Secretarys authority in the Exchange livestockOrdinance to use the Exchange Fund, with a view to maintaining HongKong as an international financial centre, to maintain the stabilityand the integrity of the monetary and financial systems of Hong Kong.So, for what it is worth, I will make an exception to my usualpractice and offer my (undoubtedly congenital and possibly biased)interpretation. Since I dont speak from a position of authority, my comments will bring down more on how times are changing and less onhow we in Hong Kong should move with them.Governor Zhou made it abundantly go that, in terms of the financialenvironment in which Hong Kong operates, times are changing andchanging fast. He made six important points. First, the nest egg rateon the Mainland is high by international standards and increasing, in tell to a zero savings rate in the United States. I take this tomean that there is an exceedingly large amount (relative to GDP) of national savings on the Mainland to be mobilised and channelled into
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