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SCMA speaks at Commonwealth Law Conference luncheon (English only)

Following are the main points of the speech on “Basic Law of Hong Kong and Foundation of‘One Country, Two Systems’” delivered by the Secretary for Constitutional and Mainland Affairs, Mr Stephen Lam, at a luncheon gathering of the 16th Commonwealth Law Conference at the Hong Kong Convention and Exhibition Centre today (April 8):

     I am delighted to have the opportunity to address such a distinguished audience. This is probably the most prestigious gathering of Chief Justices and Attorneys General in global terms. Your collective weight of judicial and legal experience should be unsurpassed by any other gatherings. It is, therefore, very fitting that I should introduce to you the Hong Kong Basic Law - our constitutional document.

     The Basic Law is unique. Most constitutions deal with :

* firstly, the key institutions of the Executive, Legislature and Judiciary; and

* secondly, human rights to be enjoyed by citizens of the respective jurisdictions.

     Our mini-constitution covers these fundamental aspects. In addition, it contains many elements of the basic policies which underpin Hong Kong’s stability, prosperity and our continued development as a civic society in the long term.

     The basic tenets of “One Country, Two Systems” were spelt out in the Joint Declaration on the future of Hong Kong entered into between Britain and China in 1984. The provisions of the Joint Declaration were incorporated into our Basic Law which Beijing enacted in 1990 following extensive consultations in Hong Kong.

     The essence of the policies incorporated into the Basic Law covers many aspects, for example, Hong Kong shall remain a free and capitalist society; Hong Kong can continue to participate in international organisations such as the WTO; Hong Kong shall have an independent judiciary to administer the common law.

External Autonomies

     You see aspects of Hong Kong’s autonomies all around you. Whether you have arrived from the UK, Canada, Australia or other parts of the Commonwealth in Asia or Africa, your national carriers would have conveyed you here. 

     You will also see Hong Kong airlines transporting our tourists to your home countries. 

     Such arrangements are made possible, because the Hong Kong Government can conclude bilateral air service agreements with foreign governments under the authority delegated to us by the Basic Law. Even Canadian Provinces and Australian States do not have such autonomies.

Economic & Monetary Autonomies

     When you arrived in Hong Kong, you use the Hong Kong dollar. Indeed, the Basic Law allows Hong Kong to have our own currency, fiscal independence and monetary policies. No tax is paid to Beijing. Even the People’s Liberation Army is stationed here free of charge to Hong Kong. Prior to 1997, we had with Britain what was known as the Defence Cost Agreement.

     The HKSAR Government has fiscal reserves amounting to HK$536 billion. In addition, the Hong Kong Monetary Authority has foreign currency reserves exceeding HK$1,400 billion. These sizeable reserves make us relatively more well equipped to deal with the financial tsunami. Up to now, no banks in Hong Kong have failed; none requires capital injection by the Hong Kong Government.

     Talking about the current international financial position, the G20 Conference held recently in London attracted worldwide attention. There is widespread support for resisting protectionist inclinations. For many decades, Hong Kong, as a Member of the WTO, has espoused multilateral free trade. We hosted the Sixth Ministerial Conference for the WTO in 2005. In coping with the stresses and strains brought about by the current financial crisis, we will not waiver from this fundamental position.

Free Trade with Mainland China

     Membership of the WTO brings quite a few benefits - one of which is a free trade agreement with Mainland China. This has been made possible, because China and Hong Kong respectively have distinct membership of the WTO.

     After SARS in 2003, at our request, Beijing agreed to enter into what we call the Closer Economic Partnership Arrangements (CEPA). Under CEPA, goods manufactured in Hong Kong can enter the Mainland Chinese market duty free. Subject to certain conditions, our professionals and various service providers can operate in the Mainland markets. This was not foreseen as a possibility when the Basic Law was enacted in 1990. 

     Hong Kong’s position under CEPA is much valued by multinational corporations. The number of regional headquarters and offices of foreign companies have increased since 2003 by more than 20% to about 3,900.

Constitutional Institutions & Human Rights

     So much for the economy. A word about constitutional arrangements. The Chief Justice and the Secretary for Justice would already have introduced to you the unique institution of Hong Kong’s Court of Final Appeal. 

     We are very fortunate to be able to benefit from international judicial talents sitting on our top bench. Law Lords from the UK and former Chief Justices from Australia and New Zealand are non-permanent judges of our Court of Final Appeal. This arrangement guarantees that Hong Kong can keep pace with international common law jurisprudence.

Human Rights

     As a free society, Hong Kong subscribes to a number of international covenants on human rights.  Article 39 of the Basic Law provides that the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights as applied to Hong Kong shall remain in force. The Hong Kong Bill of Rights Ordinance was enacted in 1991 to enable the courts to protect the rights enshrined in the ICCPR. Since that time, there have been many landmark cases, the latest of which is a High Court Ruling in December last year affirming prisoners’ voting right. Within a few months, we are already preparing legislative proposals to implement the court’s decision.

     On the Executive arm, I should like to mention that since 2002, we have introduced cabinet-style government. The Secretaries of the Government are now politically appointed. We all serve five-year terms coterminous with the Chief Executive who nominates us. We are all Members of his Executive Council and are all committed to implementing his election manifesto. 

     Members of political parties can serve as Secretaries. Members of the Legislature can also serve as Members of the Executive Council, but such Members cannot carry ministerial portfolios. 

     In time, the above arrangements will enable stronger linkages to be built between the Executive and the Legislature. This is important, because in Hong Kong we do not have Westminster-style parliamentary government. The Executive and the Legislature are elected through two different routes. 

     Currently, the Chief Executive is returned through an electoral college. Half of the seats in the Legislative Council are geographically elected; the other half are returned through functional constituencies, such as chambers of commerce, trade unions and professional sectors like lawyers and doctors.

     Articles 45 and 68 of the Basic Law provide that the ultimate aim of democratic development in Hong Kong is for the Chief Executive and all Members of the Legislative Council to be returned through universal suffrage. 

     In 2007, following public consultation in Hong Kong, the Chief Executive put a report to Beijing. In December, the National People’s Congress Standing Committee made a decision on the timetable for introducing universal suffrage in Hong Kong. The Chief Executive may be elected by universal suffrage in 2017. All Members of the Legislative Council may be elected by universal suffrage in 2020.


     Thus, to conclude, the Hong Kong Basic Law has both a historic and current role. In the run-up to 1997, our mini-constitution guaranteed Hong Kong a smooth transition to the resumption of Chinese sovereignty. Beyond 1997, the Basic Law provides Hong Kong with new room for growth in our external relations with foreign governments, free trade with Mainland China and a clear timetable for attaining universal suffrage.

     If members of this distinguished audience visit Hong Kong in eight years’ time :

* firstly, you may be received by a Chief Executive elected through a one person one vote’system;

* secondly, you will probably see that the Chief Executive has formed a political alliance among different political parties;

* finally, one hopes that eight years from now the Hong Kong economy will have recovered fully from the financial tsunami and that we will have developed much broader markets both in the Mainland of China and in your home countries.

Ends/Wednesday, April 8, 2009