Government facilitates development of e-commerce in Hong Kong
03 - 05 - 2000

The Government is fully committed to encouraging the development of e-commerce to maintain Hong Kong's competitive edge and to drive our overall economic growth, said the Director of Information Technology Services, Mr Lau Kam-hung, today (May 3).

Speaking at the annual general meeting of the Hong Kong Institution of Engineers (Information Technology Division) this evening, Mr Lau noted that encouraging the development of e-commerce was one of the key initiatives of the Digital 21 Information Technology Strategy to make Hong Kong a leading digital city in the 21st century.

"Electronic commerce is developing most remarkably around the world," said Mr Lau, "It brings us new business opportunities, opens up new markets and helps us reduce costs."

"Industry estimates suggest that the total value of products and services transacted over the Internet in Hong Kong will increase from US$60 million in 1998 to US$2.4 billion by 2003.

"These statistics and forecast indicate that Hong Kong is poised to ride on the wave of e-commerce," he added.

To ensure that electronic transactions can be performed effectively and efficiently over the Internet, it is necessary to have a high quality and high capacity telecommunications infrastructure to provide bandwidth and services at affordable prices.

"Hong Kong already has a world-class telecommunications infrastructure. Our broadband network covers practically all business buildings and we expect the residential coverage to reach 85 per cent this year," said Mr Lau.

To further enhance the telecommunications systems for the development of e-commerce in Hong Kong, the Government will introduce more competitions and encourage innovations in the telecommunications market.

A major barrier for a wider adoption of e-commerce in Hong Kong is the security concern about making transactions over the Internet, and can be addressed by the Public Key Infrastructure (PKI) which covers the use of public key cryptography and digital certificates.

Mr Lau said,"PKI enables us to authenticate the identities of the parties involved, to ensure the integrity and confidentiality of the messages exchanged, and to make sure the transactions cannot be repudiated."

The establishment and operation of certification authorities (CAs) which are responsible for the issuance and renewal of digital certificates enable the large-scale deployment of the PKI technology that in turn facilitates the development of e-commerce.

Having been a public CA since January 31 this year, Hongkong Post implements the PKI to meet both the security and operation requirements to support various e-commerce applications.

"The private sector is free to set up more CAs on a voluntary basis to meet the demand of e-commerce in Hong Kong," Mr Lau said.

"To protect consumer interests and to enhance users' confidence in electronic transactions, the Government has established a voluntary system of recognition whereby CAs are free to apply for recognition from the Government," he said.

Under the Electronic Transactions Ordinance (the Ordinance), the Director of Information Technology Services is empowered to be the authority of granting recognition to those CAs which have achieved a trust standard acceptable to the Government and have adopted a common and open interface in their operations.

This Ordinance, enacted by the Legislative Council on January 5 this year, also provides a clear and supportive legal framework for the conduct of e-commerce in Hong Kong, thus enhancing the certainty and security in the conduct of electronic transactions.

"Under the Ordinance, electronic records and digital signatures are given the same legal status as that of their paper-based counterparts," said Mr Lau.

To address the current problem of using Chinese in electronic communications and transactions that hampers the adoption of e-commerce by the local community, the Government published the Hong Kong Supplementary Character Set in September 1999.

The Government is also taking an active role in discussions with the International Organisation for Standardisation (ISO) on the development of the ISO 10646 standard which is intended to encompass all written scripts, including the Chinese characters commonly used in Hong Kong.

In the long run, the Government is going to adopt the ISO 10646 standard as the open and common Chinese language interface in Hong Kong.

To lead by example, the Government will introduce the first phase of the Electronic Service Delivery (ESD) scheme in October this year to help members of the public familiarise themselves with the electronic mode of service delivery, and to build up their confidence in electronic transactions.

"Under this scheme, public services will be provided over the Internet and through other electronic means via an open and common information infrastructure 24 hours a day and seven days a week," said Mr Lau.

"The open and common information infrastructure that we are going to develop for the ESD scheme will serve as a platform for the private sector to make use of in conducting e-commerce at a later stage," he noted.

The Government, together with other organisations, will continue to hold seminars and exhibitions to promote the wider adoption of e-commerce in the community.

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