The past two years have been busy ones for your Chamber, and highly rewarding ones for me personally as Chairman. It was an honour for me, as it will be for the next Chairman, to head a superb organisation which makes a difference in Hong Kong. Now as we move toward the Annual General Meeting on April 24, it is perhaps appropriate for me to draw together some thoughts on the work the Chamber has done while I have been Chairman, and what work, in my view, that still needs to be done.

One of the major issues facing Hong Kong is the budget deficit problem and the need to restructure our revenue base. The Chamber's position urging the government to "study the implementation of a Goods and Services Tax (GST) to get ready for the eventuality that it may have to be imposed" showed up in Financial Secretary's Budget Speech in March. While now is not the time for such a tax, the Chamber has always felt it is prudent to get it ready and put it "on the shelf" -- since experts tell us it takes three years or so just to get a GST implemented. We are happy to see that the Financial Secretary acknowledged that a GST is necessary to ensure a predictable and reliable source of government revenue.

Now is the time to get ready, to consult the community and prepare the groundwork, a task that may take two years. I certainly hope that the Chamber will be continually providing views from the business community to ensure Hong Kong has the best possible GST tax -- one that is fair, easily managed, and relies on a regulatory regime that presents the minimum possible burden to business.

Another issue which occupied me during my tenure is one which the Chamber has worked hard to raise within the government and the community at large. That is, the need to reform and restructure our civil service. Our community is changing, and so too must our government. The Chamber's pay comparison survey, released in January, went a long way toward building support for a thorough rethink of how Hong Kong's excellent civil servants are compensated. Yet, the solution cannot be continued pay cuts. Rather, it must include sensible reductions in head count. Civil service pay occupies 70 percent of our government's operating budget, so no discussion of balancing the budget can avoid reducing this amount. Restructuring will help.

We need to come to a consensus within the community that the terms and conditions of civil service employment need to evolve with the times. Departments should manage their own staff, compensating people for a job well done with performance-linked pay. There should be resolute action to corporatise and eventually outsource selected services. This will involve numerous challenges, and to bring our public services in line with community needs and financial reality will require the joint effort of business and government. I am sure the Chamber will be pushing this long range civil service restructure issue along for many years to come.

A third important issue is competition policy, and I believe it is time to start looking into whether Hong Kong needs a formal competition law. Hong Kong is a place that draws from a far wider pool of talent and knowledge than what we can grow here at home. We should look to what has happened abroad, study other jurisdictions' experiences and see what the cost of compliance would be in such a piece of legislation. I have not been able to take this issue further than that, and I hope that my successors will make progress down this road.

Fourthly, I am very pleased that the Chamber's multi-year push for greater integration between Hong Kong and the rest of the Pearl River Delta (PRD), the Closer Economic Partnership Arrangement (CEPA) and the recently proposed PRD Council have resulted in action. Both initiatives will bring major benefits to Hong Kong businesses, and I am glad the Chamber played a major role in getting the ball rolling. Now that the concepts are accepted, the real work begins. The Chamber plans to be in the thick of things. China is key to our economic development, and how to take advantage of its steady growth is the priority of the Chamber and of every businessperson in Hong Kong.

Finally, there are two other issues that I personally believe are important for the Chamber to continue to be on top of. One is whether there is a need for an anti-racial discrimination bill. The other is the importance of the role of arts and culture for Hong Kong's aspirations as a "World City." On the first, it appears the government is about to take a close look at whether we should have anti-racial discrimination legislation to keep pace with international practices. I think we should get on with that. On the latter, I hope the business community will support developments and reform in the arts and culture scene in Hong Kong. No city can claim to be world class without a world class arts and culture scene, in my view.

In my time with the Chamber, I have come to appreciate that I have a top-notch team working with me. In this, I have been extremely lucky to have the support and encouragement of an excellent General Committee and our strong committee chairs. Their time commitment and devotion to the interests of Hong Kong and the business community is an inspiration. Backing their efforts are the hard-working, dedicated members of the Chamber staff. These professionals make our ideas come to life and, because members offer their services voluntary, the staff is needed to help steer projects and provide detail support. I think you will agree with me that overall services to you continue to be of the highest quality from the Chamber.