And with the recent introduction of the Mandatory Provident Fund schemes, the demand for bonds has been building up quickly. In 1991, the bond market has a size of only about 4 per cent of GDP. This has grown to 35 per cent last year, and the share of private sector debt is now at around 77 per cent. We have come a long way but there is still a lot of room for expansion, as evidenced by comparisons with bond markets in the G-3 economies. But our bond market has grown big enough and has been robust enough for it to provide some meaningful back-up in times of financial stress. In 1998-99 when, as property prices fell sharply and the financial turmoil led to deteriorating asset quality, the banks adopted a conservative stance in their lending, corporate bond issuance increased significantly. Positioning for the future Our present pre-occupation in the development of the Hong Kong bond market is to bring in the international dimension. As an international financial centre, we of course aspire to play a role in international financial intermediation. To achieve this, our efforts have been concentrating on two fronts. First is the establishment of bilateral linkages of the appropriate elements of our financial infrastructure with those of other jurisdictions wherever it is compatible to do so, and whenever the counterparts are willing. This basically is for the purpose of facilitating the cross border investments in debt securities.
Many senior managers and specialists view their student days as a pivotal time in their lives, so the quality of teaching has a major impact on both economy and administration. Universities make a direct contribution to a country's prosperity by maintaining the necessary capabilities and developing and imparting knowledge that is useful for the economy and society. But their indirect contribution is just as important: Universities must enable their graduates to understand and appreciate the significance of the Swiss model for success. This model is based on the pillars of direct democracy, the rule of law, federalism and an awareness of the value of stable institutions. The terms 'markets' and 'competition' are key to understanding basic economic relationships, and are fundamental to ensuring prosperity, as well as to acquiring and applying new scientific knowledge. One of the tasks of a university is to provide its graduates and the general public with a realistic picture of the functioning and importance of markets and competition. Only in this way can the Swiss model for success endure in a world of constant change. 1/1  BIS central bankers' speeches