Our city is a dynamic metropolis. We have come through a difficult period of economic restructuring and are now enjoying a strong recovery, thanks to the resilience that Hong Kong people are famous for.

We are an industrious and entrepreneurial society, good at seizing opportunities, eager to take risks to get ahead, but we are also a caring and compassionate society, and ready and willing to help out the less fortunate in our community if they slip through the safety net.

Among our population of 6.8 million, a few hundred thousand are foreign nationals. Indeed, Hong Kong's congregation of expats highlights our international dimension and spices up our diversity.

Our history, culture and people, the best of the East meeting the West, have produced the sophisticated and cosmopolitan city you see today - Asia's world city.

Hong Kongers avid consumers of luxury goods

The people of this city are avid consumers of luxury goods, with sophisticated and discriminating tastes. Hong Kong people work hard, and they want to enjoy the fruits of their labour.

So they have a big appetite for the luxury lifestyle: homes, cars, clubs, holidays, clothing, accessories, gourmet food and wine. Take a walk around Victoria Peak - you could call that a "lap of luxury".

Hong Kong has the highest ownership rate of Rolls-Royce and Mercedes-Benz cars on Earth. We are a leading importer of cognac. And we buy and sell with equal enthusiasm. Hong Kong is the world's second-largest exporter of garments, travel goods, handbags, watches and fur clothing, and the third-largest exporter of fine jewellery.

We are also one of the world's great tourist destinations. The number of tourist arrivals has doubled since 1997 to some 20 million this year, and it's expected to keep growing by leaps and bounds and reach 35 million by 2010. Among our many attractions, the one that draws many tourists to Hong Kong is our well-deserved reputation as a shoppers' paradise.

Mainland visitors drawn to shopper's paradise

This distinction is certainly not lost on our compatriots to the north. As people on the Mainland acquire more disposable income and they are becoming increasingly prominent in the high-end boutiques of the Central and other parts of Hong Kong.

Many of the world's best-known fashion names have established their Asian headquarters or Asian flagship stores in Hong Kong. The International Herald Tribune this week described our Central district as "Fifth Avenue of the Far East" because it has the world's highest concentration of top international labels.

Increasingly, global retailers are using our city as their platform for developing brand recognition in this region, and especially for penetrating the biggest prize of all - that vast Mainland market of 1.3 billion people. With retail sales and tourist arrivals both growing robustly here, we expect more and more brands to choose Hong Kong as their Asian showcase.

CEPA adds to Hong Kong's attraction

Why else do international companies set up here? Among the many reasons: the rule of law, upheld by an independent judiciary; the free flow of information; the movement of people; free flow of capital; a low and simple tax system; a clean civil service; and a level playing field for all businesses.

There's also CEPA, our free-trade arrangement with the Mainland, which enables multi-national companies to use Hong Kong to gain faster and greater access to the Mainland market. In particular, CEPA can be very useful for the makers of brand-name goods or products to achieve this purpose if they are here in Hong Kong.

Besides being a leading international financial, trade and business services hub, Hong Kong is also a major conference centre. This Luxury 2004 event confirms that status. Over the next couple of years, Hong Kong will be welcoming a wide range of convention-goers, from Interpol officers to international meteorologists.

Next June, the Lions Clubs International Convention will bring 20,000 delegates from 110 countries. Hong Kong is the only place outside the US to host the Lions Conference twice.

Later next year, the Sixth World Trade Organisation Ministerial Conference will be held in Hong Kong, a privilege that underlines Hong Kong's status as a founding member of the WTO.

And two years from now, the International Telecommunication Union will hold ITU Telecom World 2006 here. It will be the first time the ITU has held the world's premier telecom event outside Geneva.

We're expecting 100,000 visitors for that one, which will be held in the new Asia World-Expo conference centre being built next to our award-winning airport.

Creative industries nurtured

Hong Kong has a rich cultural life, too, and we are nurturing our creative industries, be it in music, movies and digital entertainment. We will focus our efforts to develop fashion design, particularly to develop our full artistic potential when it comes to understanding Chinese tastes.

Hong Kong has also become the hub for Asian art transactions, with Sotheby's and Christie's both holding highly successful auctions here only last month.

As for intellectual property, we understand how valuable a brand is, in both creative and business terms. That's why we work hard to protect intellectual property, and we have the legal framework to do so, backed by vigorous enforcement and continuous public education.

And I know, speaking with Mr Bernard Arnault yesterday, I know that more work needs to be done here in Hong Kong. I just want to assure you we will spare no effort in protecting intellectual property.

We are not perfect. We are working very hard at it. After all, it is important to us. Hong Kong also has its own distinctive brand, "Asia's world city" and our Flying Dragon, which symbolise what we are and what we are trying to accomplish.

Half of global population within a five-hour flight

Hong Kong is strategically situated in the heart of Asia. We are within a five-hour flight of half of the world's population. The fact is that Hong Kong is at the centre of the fastest growing region in the world, a region with high savings rates and increasingly affluent populations.

And when it comes to China, which will become one of the largest economies in the world by 2020, nobody has done business there longer than Hong Kong, nobody knows that market better than Hong Kong, and nobody is better connected there than Hong Kong.

In the years to come, we will look forward to welcoming you to Hong Kong as a tourist, as a business executive, or as a new resident to see the progress we will be making as Asia takes off.

Chief Executive Tung Chee Hwa gave this address at the "Luxury 2004: The Lure of Asia" Conference at the Grand Hyatt.