TRADE POLICY REVIEW: HONG KONG, CHINA
16 and 18 December 2002

Concluding remarks by the Chairperson

See also:
> Press release: Open trade regime has helped withstand recent external shocks

This Review has provided an excellent opportunity for Members to better understand the trade and economic policies of Hong Kong, China. Our meeting has involved a very informative exchange of views, stimulated by the full and open engagement of the delegation of Hong Kong, China, broad-ranged and insightful comments by the discussant, and Members' active involvement in the discussion. Members' evaluation of the trade and trade-related policies of Hong Kong, China has, by and large, been positive; Members commended Hong Kong, China for maintaining one of the most open economies in the world, one which many Members should seek to emulate. The outcome, I believe, has been a highly successful fourth Review of Hong Kong, China's trade policies, practices and measures.

Since its reversion to China, Hong Kong, China's institutional and policy framework has remained largely unchanged, in accordance with the principle of “One Country, Two Systems”. Despite the difficulties it has faced as a result of the Asian financial crisis, current global economic downturn, and increasing integration with the rest of the country, Hong Kong, China has maintained its traditional openness to both trade and investment; indeed, it has taken further liberalization measures during the period under review.

Members congratulated Hong Kong, China on its active role in the WTO, including its strong support for the Doha Development Agenda. Members noted Hong Kong, China's increasing involvement with regional and bilateral trade agreements. Hong Kong, China provided information regarding the development of regional trade agreements between it and other Members, and noted that these agreements would be fully consistent with the principles underlying the WTO.

Members commended Hong Kong, China for its continued trade-liberalization efforts and for the transparency and openness of its trade and investment regime. While the authorities of Hong Kong, China did indicate that they were now following a more “proactive” approach to industrial policy in an effort to promote high value-added activities, this policy involved support for general infrastructure to facilitate development. The authorities re-affirmed that the policy does not involve picking winners or rescuing losers at taxpayers' expense; nor does it involve protecting or subsidising particular industries.

In the interests of predictability and stability, Members encouraged Hong Kong, China to bind more of its tariffs. Some Members also encouraged it to reduce excise tax rates on wine. Some Members urged Hong Kong, China to continue to strengthen its regime to protect intellectual property rights, particularly enforcement. Members generally appreciated Hong Kong, China's efforts to maintain a competitive market.

On sectoral issues, Members noted the predominance of services in Hong Kong's economy. Members commended Hong Kong, China on a wide range of commitments under the GATS together with the lack of MFN exemptions, as well as on its liberalization measures, particularly in telecommunications and financial services, undertaken since its previous Trade Policy Review in 1998.

Members also sought clarification on several specific issues including:

• macroeconomic policy and the broad economic environment;
• WTO accession of China and its benefits to Hong Kong, China;
• rules of origin under the proposed FTA with China;
• import licensing;
• contingency measures;
• standards, sanitary and phytosanitary measures;
• government procurement;
• assistance to certain activities and small and medium-sized enterprises;
• rice stocks;
• rules of origin concerning textiles and clothing;
• division of regulatory responsibilities concerning securities;
• air and maritime transport;
• recognition of diplomas and qualifications;
• postal service liberalization, broadcasting licences, legal services, licensing requirements for inbound travel agents; and
• movement of natural persons (visas);

Members expressed their appreciation of the oral and written responses and explanations provided by the delegation of Hong Kong, China.

This brings us to the conclusion of our fourth Trade Policy Review of Hong Kong, China. The large number of advance questions, numerous interventions and the high level of attendance indicate the importance Members attach to Hong Kong's leadership at the WTO. In this context, I would encourage Hong Kong, China to continue its traditionally strong support for the multilateral trading system.