Way forward: Chief Executive Donald Tsang delivers his 2008-09 Policy Address in the Legislative Council.

Hong Kong people's resilience will help the city emerge stronger from the current global financial tsunami, Chief Executive Donald Tsang says.

Delivering his Policy Address to the Legislative Council today, Mr Tsang said Hong Kong would turn the current crises into opportunities by pursuing economic development in financial services, cross-boundary integration, infrastructure projects, creative industries and scientific research.

He will set up and chair a task force to assess the impact of the financial crisis on Hong Kong's economy, and propose specific options for the Government and business community to address the challenges.

"This will help us overcome the crisis, turn it into new business opportunities and enhance our competitiveness," he said.

Mr Tsang said the Government would continue to help people ride out the current difficulties, protect public interests and help everyone move forward.

There will also be steps to improve the living environment, to engage the public, and to boost co-operation with the new Legislative Council.

Mr Tsang said good progress had been made implementing the major infrastructure projects and initiatives outlined in the 2007-2008 Policy Address.

These would increase job opportunities and economic benefits, which would give fresh impetus to economic growth at a time when the external economic environment was deteriorating.

"In times of uncertainties, there is a greater need to keep calm and to accomplish our tasks pragmatically," Mr Tsang said, adding: "Hong Kong is on the right track with its development."

Hong Kong people are known for resilience in the face of adversity, he stressed. "All these years, we have worked miracles in times of difficulty, making continuous improvements and progress. I have full confidence in Hong Kong people. Our people should have confidence in themselves, too. Sharing a common vision, we can rise above all challenges and emerge stronger."

Turning crisis into opportunity

Mr Tsang said the Government would use the current economic crisis as an opportunity to reinforce Hong Kong's position as a global financial centre.

This would include enhanced banking supervision, tightened regulation of fund managers, the establishment of an independent Insurance Authority, greater employee say over Mandatory Provident Fund investments, and increased efforts to broaden the scope of stock exchange listings.

Hong Kong must broaden its horizons and intensify economic integration with the Pearl River Delta if it wanted to stand out in the face of severe global competition, he said. That is why the Government would take the lead in building a Hong Kong-Shenzhen metropolis and strengthening co-operation with Guangdong.

Measures would include:

* promoting co-operation in service industries;

* working with Guangdong to optimise and upgrade industrial infrastructure while helping Hong Kong enterprises to respond to Mainland policy adjustments;

* facilitating cross-boundary environmental protection to create a green and quality living area in the PRD Region; and

* strengthening co-ordination and planning of cross-boundary infrastructure projects.

The Government will work with Shenzhen authorities, and consult the public, on the development of the Lok Ma Chau loop - with a focus on exploring uses for higher education, high-tech research and development of cultural and creative industries.

Mr Tsang said that to complement enhanced cross-strait relations, the Government would strengthen exchanges and co-operation with Taiwan.

Local and Taiwanese business leaders will be encouraged to establish a Hong Kong-Taiwan Business Co-operation Committee to foster closer links in areas such as trade, investment and tourism. The Hong Kong Trade Development Council will also set up an office in Taipei.

New immigration procedures to come into effect in January 2009 will make it easier for frequent business visitors and tourists from Taiwan to come to Hong Kong. 

To help commerce and business development, the Government would also discuss with the Trade Development Council a phase-three expansion of the Hong Kong Convention & Exhibition Centre at a nearby site.

To promote the development of creative industries, a new Creative Industry Office would be set up under the Commerce & Economic Development Bureau to integrate, realign and co-ordinate the work of different departments and work closely with the trades.