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Following is the transcript of remarks by the Financial Secretary, Mr John C Tsang, at a media session in Beijing today (June 24):
Financial Secretary: The UK has just decided by a narrow margin to leave the EU, which I think came as a surprise to the market. I'm also a bit surprised myself with the strength of the sentiment. Brexit has triggered off substantial volatility in global financial markets, with stock markets across Asia fell to a significant extent. Hang Seng Index at closing fell by some 600 points, about 3 per cent. In the last few weeks, our financial regulators have been preparing for the possibility of Brexit, and have conducted stringent stress tests. They have also reminded our financial institutions the importance of prudent risk management. The market today operated in a smooth and orderly manner. Hong Kong dollar exchange rates and interest rates remain stable. We shall continue to monitor the situation closely.
UK is a key player in global financial market and also one of the biggest economies in the world. Brexit will no doubt cause disruptions to international trade and financial markets, and that will further weaken the global economy, which is already facing strong headwinds. These volatilities and uncertainties will have an impact on Hong Kong's trade, as well as on financial markets. But that said, with our sound economic fundamentals, our robust regulatory regime, strong banking sector and healthy fiscal position, I am confident that we have the experience, we have the determination and we have the will, as well as capability, to tackle the challenges ahead.
Reporter: Mr Tsang, we see that after the Brexit there is a fluctuation in the currency market. How do you see such a fluctuation will do on the Hong Kong tourism or the trades? We could see that when the currencies of the foreign exchange are quite high, there will be a drop in the numbers of tourists coming to Hong Kong. How do you see that?
Financial Secretary: I don't know if you are referring to visitors from the UK. Obviously, with the change in the exchange rate in Sterling, it would be more expensive coming to Hong Kong. So I think maybe for those tourists, they would have to think twice, but we've been looking to tourists in the East Asia area, in our neighbourhood, and in the last few months I think we have seen an increase in terms of tourists coming from our neighbouring countries. These are good quality tourists. A lot of them stay overnight and, as you know, in Hong Kong the overnight tourists, their spending is about three times of those tourists who don't stay overnight. So these are the quality tourists that that we look forward to having more of.
Reporter: How about the trades between Hong Kong and the UK?
Financial Secretary: The trade between Hong Kong and UK, it all depends on how people take advantage of their position. If Sterling were to weaken, it may be a good opportunity for the UK to export further because they will be a lot more competitive. So that is the situation to see how the market operates.
(Please also refer to the Chinese portion of the transcript.)
Ends/Friday, June 24, 2016
Issued at HKT 19:44
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