Last month the world watched as Beijing hosted the very successful 2008 Olympic Games. There are very few better examples of how important time-keeping is than the Olympics. A fraction of a second can make the difference between success and being the second best. Just ask Serbia's Milorad Cavic who lost to Michael Phelps in the 100-metre butterfly by one 100th of a second.

The timepiece market is particularly dynamic and competitive. Consumers worldwide pay more attention to the evolving fashion, design and innovative elements. Product lifecycles are getting shorter and the challenges for manufacturers, designers and distributors are getting tougher.

I'm pleased to note that the industry in Hong Kong is rising to this challenge. In the first half of this year, the industry's total export value was more than $25 billion, equivalent to about US$3.2 billion. That's an increase of 17.3% compared to the same period last year.

Our focus is on developing original designs and brand names. We have partnered with the industries and introduced measures to facilitate our manufacturers, many of whom are based in the Pearl River Delta.

We are helping them to meet global challenges by promoting wider use of design and innovation. We are also grooming creative talent and investing in our tertiary and continuing education programmes.

Another initiative is our unique free trade pact with the Mainland called the Closer Economic Partnership Arrangement, or CEPA for short. CEPA provides opportunities for companies incorporated in Hong Kong, regardless of the nationality of their owners and shareholders, to have World Trade Organisation-plus access to the Mainland market.

Last month a new CEPA supplement was signed which increases the number of service sectors covered by the arrangement to 40. There are also several pilot measures specifically related to co-operation between Hong Kong and our neighbouring province of Guangdong. These include key areas such as protection of intellectual property and branding development.

I really don't need to preach to you the importance of IP protection and branding to the timepiece industry. You know it very very well. I just want to reassure you that we and our partner in Guangdong know very well that a robust IP protection programme and branding support are crucial to making Hong Kong and the PRD region a centre of timepiece design, manufacturing and branding that stands the test of time. And we mean business.

So I encourage you to explore the numerous possibilities of CEPA through our Trade Development Council's matchmaking service. The council has a fine record in finding local partners for overseas small and medium-sized companies to take full advantage of our cross-boundary co-operation in manufacturing, distributing, retailing and branding.

Chief Secretary Henry Tang gave this address at the opening ceremony of the Hong Kong Watch & Clock Fair 2008 at the Hong Kong Convention & Exhibition Centre.