HK Trade Secretary's comments anger Singapore

Mr Chau claimed the Singapore government had "advantages" over Hong Kong's in implementing strong medicine to tackle the economic downturn because of its allegedly authoritarian regime.

He claimed the People's Action Party, which has governed Singapore since independence, was better able to implement unpopular policies like wage cuts because it had complete control over parliament, the media, trade unions and the people.

Now Chan Heng Wing, Singapore's consul general in Hong Kong, has hit back, saying Mr Chau's comments were "inaccurate and misinformed" and showed a "lack of understanding of how Singapore works".

The consul general's comments were carried extensively in Singapore's press yesterday, lambasting Mr Chau for his remarks.

Mr Chau is the second senior Hong Kong official to raise the Singapore authorities' wrath.

Late last year, Financial Secretary Donald Tsang made similar comments about Singapore after a Washington-based think-tank, the Heritage Foundation, said it had effectively overtaken Hong Kong as the freest economy in the world following the SAR's stock market intervention.

In what was widely seen as a veiled attack on Singapore, Mr Tsang suggested the foundation consider whether "other economies" dictated wages and held undisclosed stocks, along with other criteria such as political and press freedom.

Mr Chau made his comments while responding to a query from legislator Hui Cheung-ching who wanted to know whether the first meeting of SAR Chief Executive Tung Chee-hwa's Council of International Advisers in January had resulted in any proposals to enable Hong Kong to better compete with Singapore.

Mr Chau told the Legco panel: "Of course we are different from Singapore. The opposition parties in Singapore do not raise opposition. If they do raise opposition, they might be arrested . . . our legislative council has 60 opposition members."

Mr Chau is believed to have been referring to the recent jailing of two leading opposition figures for staging a political street speech without a police permit.

Responding, Mr Chan said: "Secretary Chau's statements about Singapore are inaccurate and misinformed. His assertions of compulsion and control show a lack of understanding of how Singapore works."

No government could force workers to accept its will on a "sensitive personal matter like a pay cut", he said.

Mr Chan, Prime Minister Goh Chok Tong's former press secretary, said: "In a totally open society like Singapore, either the government would lose support, or Singaporeans would vote with their feet and emigrate.

"The Singapore government has to face the ballot box every five years. If it cannot muster support for its policies, it will be thrown out."

Mr Chan said the government had managed to implement salary package cuts on January 1 only because it had "painstakingly" explained the situation and the necessity to unions and workers for more than six months beforehand.

In a bid to smooth relations between Singapore and Hong Kong, Senior Minister Lee Kuan Yew, met with Hong Kong's Chief Executive Mr Tung on the sidelines of January's World Economic Forum in Switzerland.

The two leaders apparently agreed that competition between Singapore and Hong Kong was positive for both sides and should not be viewed as negative or destructive.

Relations have become tense since Singapore launched a rival Hong Kong stock futures contract last November, which was viewed in some quarters as predatory.

At the peak of the row, Hong Kong's Financial Services Secretary Rafael Hui described Singapore as an "offshore betting centre".