Introduction: A great honour
It is a great privilege to be invited to speak on behalf of those you have honoured this evening. We have taken different paths, studied different disciplines and pursued different interests in the course of our lives and careers. But we will always have in common this proud moment at the University of Hong Kong.
By accepting these honours each of us knows we are, in fact, accepting a challenge: we must be prepared to serve the community even more in the future. Such is the time-honoured spirit of this congregation.
This is a time when all of us in Hong Kong must give of our best. With 1997, we have reached a defining moment in the life of our community. We are also preparing to welcome a new century, one of greater opportunity for Hong Kong.
I believe we will only realize these opportunities if we understand our strengths, nurture them and recognize the existence of challenges to which we must respond. These will have profound implications not only for ourselves but for the education system which helps to underpin our progress and success as a community.
I will focus my remarks this evening on the business world. This is not to minimize the importance and contributions of other aspects of our community in promoting the overall good of Hong Kong. It is simply because this is what I know best.
Business Opportunities
In the business world, I believe we have our biggest chance yet to make Hong Kong the international business and financial hub of Asia.
The momentum towards trade liberalization, especially among members of the Asia-Pacific Economic Co-operation forum (APEC), is unstoppable. This applies to services as well as goods.
Opportunities are also expanding for Hong Kong companies to add value to global trade flows. We have established manufacturing and trading operations throughout the region. This enables us to bridge the widening gap between Asia's dispersed sources of supply and customers in Europe and North America.
Our single biggest business opportunity continues to be mainland China, with its ongoing commitment to market opening. In particular, its determination to achieve more balanced development between coastal and interior provinces is creating new demand for manufacturing investment, expertise and consumer products.
We face these opportunities with a wide range of competitive strengths. Among them, Hong Kong's very advanced physical infrastructure and our strong services sector. The dominant role of Small and Medium- sized Enterprises (SME) in our economy is another asset, along with the entrepreneurial spirit, outward focus and legendary business acumen of our people.
Challenges to Competitiveness
However, there is no room for complacence. In addition to the external challenge of other business centres in the region, we face a number of internal challenges to our competitiveness.
Most obvious, is the cost of doing business here. Hong Kong rents and salary levels are high by any comparison. Of course, our argument is always that if you take Hong Kong as a total package, which includes low taxes, relatively high profit margins and strategic location vis a vis the mainland, we come out ahead. But we are known in the international business community as an expensive place to operate. That is hard to deny and harder to change.
A bigger cause for concern, in my view, is human resources. We have achieved a remarkably frictionless transition to a services-oriented economy at what many consider a breathtaking pace. This has created tremendous demand for skilled, bilingual office workers and professionals to serve the needs of our maturing economy. It is being met in part by graduates from our expanded tertiary sector joining the workforce and by an inflow of professionals returning to Hong Kong from emigration countries. But most of us in business are experiencing difficulty in satisfying our human resource needs, especially in knowledge-intensive areas such as financial services and information technology.
For example, if we ask ourselves can we justify expanding our business involvement in the region by 20 or 30 per cent across several sectors immediately, I'm sure the answer is 'yes'. We can all see the opportunity. But if the follow-up question is whether we can find enough qualified professionals: lawyers, accountants, architects, engineers and others to do so, I think we all know the answer. Insufficient supply of human resources with the right skills places real constraints on economic growth.
Challenges for Education
The implications for our education system are profound. We are dealing with a new set of realities. The needs of the economy have moved so fast that it has been very difficult to keep up.
Hong Kong's move from a labour-intensive to a knowledge-intensive economy is throwing up particular challenges for our educationists. There is no doubt that our education system is moving in the right direction. We are graduating more people and the quality at the top is still there. But, as inevitably happens during periods of rapid growth, it is difficult to uphold average quality. Moreover, the demands we place on graduates from our schools and universities are rising.
Today and into the future, Hong Kong needs a workforce with advanced skills and high professional qualifications. But above all, we must nurture in our young executives an ability to think creatively and to take decisions independently.
We have always excelled at training doctors, lawyers, civil servants and scholars. Now we must step up the training of managers, teachers and other professionals needed to play an expanded role in our maturing economy.
We face a tremendous need with communications and marketing. Integral to Hong Kong's competitiveness is our ability to sell. This means an ability to project our products or services into another market, another culture and to work closely with partners there. We need young professionals with a superior breadth of understanding and exposure to the different tastes, styles and aspirations of other communities. All this demands superior skills in cross-cultural communication, languages and marketing. We look to our universities to provide our students with a strong conceptual framework and language training.
I am not suggesting we should leave everything just to the tertiary sector. In some cases perhaps its best role is to exert a positive influence over other parts of the education system. This is particularly true in the ongoing debate over standards of English and Chinese in Hong Kong. We all know the importance of these two languages to Hong Kong's international competitiveness. We are all aware of widespread concern that our system is producing young people truly competent in neither. Where our universities can help is in tightening and upholding higher entry requirements for English and Chinese. Stricter entry standards would compel school students and all involved at primary or secondary level to take a more rigorous approach to acquiring advanced language skills. The message must be driven home that this is essential to winning a good university place.
Another challenge for our education system is management training. Having formed a big part of my own studies and early career as an academic, this is close to my heart. All the evidence in Hong Kong's business community is that we need to professionalize management. The next stage of our development rests heavily on our ability to manage larger organizations. This does not spell the end of SMEs. Far from it. It marks the evolution of more successful SMEs into regional multinationals. We are developing businesses that require more sophisticated information and management systems. They involve large numbers of professionals working together with a common vision. Entrepreneurial flair, though important, is not enough. What we need is the ability to run these systems, motivate people and co-ordinate and support the work of cross-cultural, cross-disciplinary projects and teams.
Experience suggests it will not be enough to rely on in-house training and career development. Many of our companies are relatively small. They simply do not have the resources to undertake their own training schemes. So we look to our business schools to provide the lead. But we must also provide them with adequate support. I think it is very important for Hong Kong's MBA schools, management training programmes and the business community to work more closely together. This means achieving a much higher degree of interaction in developing relevant programmes and co-operation for case studies and project work.
Conclusion: A Business Opportunity for Education
The quality of Hong Kong's education system is on par or superior to that found anywhere in the region. Yet Hong Kong has not taken advantage of that as a potential source of invisible income for the territory.
Why, for example, should Australia be such a magnet for the English-language education of foreign students from all over the region? Malaysia is also coming up fast. Why is Hong Kong barely in the picture, when we have the capacity to attract the best students in Asia?
Students from other parts of the region are a useful source of revenue and create further employment opportunities in education. But much more than that, they are a source of good connections among Asia's next generation of leaders. The opportunity to rub shoulders with the region's best helps to develop our own future leaders. Through these contacts, we can further build personal friendships with our neighbours, along with future business ties. And we can project Hong Kong's own abilities into the wider region. What I am suggesting is that, as the business hub of Asia, Hong Kong should also become the region's hub for business education.
There is clearly enough demand. We can see it already in the dozens of satellite education programmes operated in Hong Kong by institutions in North America and Europe. We can see it in the fact that Hong Kong is already a magnet for institutes of higher learning around the world to establish a base where they can study the region and its economic development. This provides a natural opportunity for our universities to form strategic partnerships which include management training programmes.
We are justly proud of what Hong Kong has achieved in education. It has been an integral part of Hong Kong's competitiveness as a regional business centre. I believe the time has now come to take an even more vigorous approach to our strengths in this area. Education deserves a higher profile among our services exports. And Hong Kong's universities are ready to compete with the best in the region.
May I say once more what a great honour it is for myself and fellow recipients to be before you. With our gratitude go our warmest wishes for the University of Hong Kong to lead and excel far into the next century.
Thank you.
