As 2003 begins, I would like to wish all of you in the business sector a propitious and rewarding year. Recent discussions about Hong Kong's economic integration with the Mainland, especially the Pearl River Delta, have captured the attention of the whole community. Officials from the Central Government, Guangdong and the Hong Kong SAR have all voiced their opinions. I also mentioned this issue to the Chief Executive in a meeting with him last November to express the Liberty Party's expectations for this year's Policy Address.

Although the Policy Address had yet to be delivered at the time of writing, I expect that it will cover economic integration. In my opinion, further economic integration with the PRD will bring substantial benefits to Guangdong Province, Hong Kong, Macau and the Mainland as a whole.

During his visit to Hong Kong last month, Premier Zhu Rongji expressed his concerns over the flow of people and goods between Hong Kong and the Mainland. He also indicated his support for the Hong Kong/Macau/Zhuhai Bridge and for developing a closer economic partnership. His opinions reflect the fact that the Central Government recognizes the positive effects of economic integration.

Hong Kong has always been closely linked with Guangdong economically. The Chief Secretary for Administration, Donald Tsang, recently said that the PRD would become a manufacturing base for foreign enterprises, while Hong Kong would serve as the service centre for businesses and as a place for professionals to live. To achieve this goal, we really need to make improvements in a number of areas.

Firstly, I fully support the Hong Kong/Macau/Zhuhai Bridge and think it should be built as soon as possible. The construction of this new cross-border passage will help integrate Hong Kong's economy with Macau, Zhuhai and western Guangdong. Apart from easing congestion at existing bottlenecks and advancing the logistics industry here, I believe it will also help the PRD become a premier tourist destination.

Besides, as the logistics hub of the PRD and South China, Hong Kong's prospects for developing the industry are good. The government should speed up construction of a logistics park and implement various infrastructure works to boost the sector. It should also allocate more resources to train managerial professionals, especially with regard to strengthening support to SMEs in the industry. As such, Hong Kong can fully maximize its advantage as a regional logistics hub.

Both the Shenzhen and SAR governments said easing congestion at peak hours was more important than having the border open 24 hours a day. However, the SAR Government should continue discussions with the Mainland for 24-hour border crossing as its long-term goal. I was delighted to hear Mr Tung Chee-hwa announce during his duty visit to Beijing that the Huangguan crossing will be open for 24 hours a day starting from Chinese New Year. I hope that both governments can quickly extend the crossing hours at other checkpoints, improve facilities at checkpoints and consider implementing a co-location customs clearance system.

Furthermore, to optimize the benefits of economic integration, the Mainland/Hong Kong Closer Economic Partnership Arrangement (CEPA) should be concluded as soon as possible. Again, I was delighted when Mr Tung also announced that CEPA would be concluded in June 2003. If the Mainland and Hong Kong can come to an agreement on the CEPA before then, both parties and even the state will benefit from the closer integration that it will bring. I am keeping a close watch on the progress of the arrangement and will keep you up to date on its development.

Now that Guangdong, Hong Kong and Macau have reached a consensus on furthering development of the PRD into a more prosperous economic region, the next step is execution. I hope we can adhere to the goal of united development to accelerate the implementation of these measures. Because only by working in unison will all parties be able to achieve the maximum benefit.