For discussionEC(95-96) EC(96-97)10
on 8 May 1996


Subhead 001 Salaries

Members are invited to recommend to Finance Committee -

  1. the creation of three permanent posts of Administrative Officer Staff Grade A (D6) ($141,300), to be offset by the deletion of two posts of Secretary, Government Secretariat (D8) ($157,250), and one post of Administrative Officer Staff Grade B1 (D4) ($126,100-$129,950) in the Overseas Offices of the Trade and Industry Branch; and
  2. the extension of the approved flexible ranking system in the Hong Kong Economic and Trade Offices to all Directorate Head and Deputy Head posts.


The present ranking of three Heads of Overseas Offices (HOO) posts, namely Commissioner, London, Commissioner, USA, and Principal Representative (Tokyo), needs adjustment to reflect their current and future role and responsibilities in the light of changing circumstances.


2. The Secretary for Trade and Industry (STI) proposes to -

  1. create one permanent post of Administrative Officer Staff Grade A (AOSGA)(D6), offset by the deletion of one permanent post of Secretary, Government Secretariat (Secy, GS) (D8), as Commissioner, London, with effect from 1 January 1997;
  2. create one permanent post of AOSGA (D6), offset by the deletion of one permanent post of Secy, GS (D8), as Commissioner, USA, with effect from 1 August 1996;
  3. create one permanent post of AOSGA (D6), offset by the deletion of one permanent post of Administrative Officer Staff Grade B1 (AOSGB1) (D4), as Principal Representative (Tokyo), with immediate effect; and
  4. extend the flexible ranking system and delegate to the Secretary for the Civil Service (SCS) the authority to create supernumerary posts of Secy., GS (D8), held against permanent posts of AOSGA (D6), as HOO where the situation so justifies.

3. The total effect of these proposals is to create three AOSGA (D6) posts, offset by the deletion of two posts of Secy, GS (D8) and one AOSGB1 (D4) posts.


4. Hong Kong’s future success relies heavily on the continued growth in our trade and economy. We have a global network of ten Hong Kong Economic and Trade Offices (ETOs) which represents and promotes Hong Kong’s interests overseas. The heads of these offices are important appointments and they are ranked at different levels to reflect their role and responsibilities in relation to the host countries concerned. Members have expressed concern that the ranking of the Commissioner, London and Commissioner, USA posts needs to be reviewed in the light of changing circumstances in respect of the former and operating experience in respect of the latter.

5. STI has reviewed the ranking of the heads of all our ETOs concluded that they are all appropriately ranked except for three, namely, Commissioner, London; Commissioner, USA; and Principal Representative (Tokyo).

London Office

6. The Government is progressively restructuring the London Office into a standard ETO by 1997. As we have advised Members before,been advised that we see no justification to retain the post of Commissioner, London, at the current D8 rank on completion of the restructuring in end-1996.

7. In considering the new ranking of the head of the London Office, we have taken into account the fact that the UK is a major source of commercial presence and investment in Hong Kong. There are now about 1,000 companies in Hong Kong with British involvement through direct control, investment or management. The UK is the largest investing country in Hong Kong. In 1994, total British investment amounted to $206 billion, according to surveys of the Census and Statistics Department and Industry Department. London is also the most important financial centre in Europe. The British headquarters or European headquarters of many multi-national companies are located there.

8. There is a further dimension. During the transitional period through 1997 there will be a critical need for a very senior presence in London to monitor the progress and anchor bilateral discussions on a host of sensitive issues between Hong Kong and London, e.g. nationality, visas, air services agreements etc. The Commissioner will have to continue to intervene on Hong Kong’s behalf with senior contacts in Whitehall and Westminister. A drastic drop in rank would be negatively received by the UK media and among official and commercial circles. This would undermine the level of access and influence of the Commissioner and his colleagues in London, and ultimately the interests of Hong Kong.

9. The above considerations argue that although the current ranking of the Commissioner will not be appropriate on completion of the restructuring of the London Office, we still need a senior directorate officer in London. We consider that the responsibilities falling on the post of Commissioner, London up to 1998 will require an experienced AOSGA(D6) officer. We also propose to review this ranking after 1998 when bilateral issues between Hong Kong and London are expected to diminish. Accordingly, we recommend that the post be regraded from Secretary, GS (D8) to AOSGA(D6) with effect from 1 January 1997 when the current incumbent (who is a substantive D8 level officer) leaves the post.


10. The post of Commissioner, USA at D8 level was created in May 1993 to strengthen our representation in Washington, to ensure that congressional and business leaders were fully aware of Hong Kong’s interests and concerns, to promote Hong Kong more widely through the USA, and to oversee and co-ordinate the work of the three ETOs in the USA. The USA is our second most important trading partner as well as a major foreign investor in Hong Kong. It is essential that the Hong Kong case is well presented in the right quarters in the US.

11. The Commissioner, USA post has now been in operation for three years, we have reviewed its effectiveness in the light of experience. We consider that the presence of a Commissioner in the USA has served the intended purpose. Experience has shown that the Commissioner is very useful in reinforcing our access to important political contacts in Washington and this is vital in handling issues which are very sensitive to the US but which also have serious consequences for Hong Kong. The seniority of the Commissioner is also useful in gaining access to the decision-making level people in big corporations in our efforts to promote more American business and investment in Hong Kong. This is important as Hong Kong will be launching its new initiatives to encourage foreign investment in our services sector. The senior status of the Commissioner also facilitates access to senior editors and editorial boards of major media organisations.

12. The Commissioner has also improved the coordination and the effectiveness of the three ETOs in Washington DC, New York and San Francisco. Washington is the focus of all government contacts and, in particular, of consultation and lobbying activities. New York and San Francisco have stronger links with business, banking, investment promotion and various academic and cultural associations. The Commissioner, USA plays an important role in the overall direction of the work of these three ETOs, in ensuring that they achieve the goals and objectives laid down, and in promoting and safeguarding Hong Kong’s overall trade and economic interests in the US.

13. We have concluded that a senior post is required in Washington. In the light of working experience, we consider that the Commissioner post should be ranked at AOSGA (D6). Accordingly, we recommend to regrade the post from Secy, GS (D8) to AOSGA (D6) with effect from 1 August 1996 when the incumbent (who is a substantive D8 level officer) leaves the post.

Tokyo Office

14. We established the Tokyo ETO in September 1988 to promote Hong Kong’s commercial, economic and public relations in Japan. The head of the office, known as Principal Representative (Tokyo), is ranked at AOSGB1 (D4). Our review has shown that the present ranking is no longer commensurate with the responsibilities undertaken by the Permanent Representative. Furthermore, the level of responsibilities exceeds that of other AOSGB1 posts in the civil service.

15. The Japanese market and its foreign investment are of significant importance to Hong Kong’s trade and economy. Japan is Hong Kong’s third largest trading partner, and total trade in goods between the two places amounted to $303 billion in 1995. Japan is overall the second largest foreign investor in Hong Kong. In 1994, total direct investment in Hong Kong from Japan amounted to over $151 billion, a level which is higher than direct investment from the US. Japan is the largest foreign investor in our manufacturing sector, and being the second largest investor in our non-manufacturing sectors, its investment in other areas such as finance, construction, retail and other services sector practices, it remains an affluent market to which access by foreign economies has proven to be difficult.

16. In addition to being a world economic superpower, Japan’s close relationship, understanding and support are of the utmost importance to maintaining international business confidence in Hong Kong. As a close neighbour with strong influence in the region, and with interest in maintaining Hong Kong’s long term prosperity and stability, the case of Japan’s importance to the future stability and prosperity of Hong Kong is obvious.

17. In order to achieve our objectives, a very senior officer at the head of the Tokyo Office is of vital importance. Moreover, the Japan culture demands that only people with sufficient ranking, seniority, maturity and experience can gain access to high-ranking Japanese officials and corporate decision-makers, and receive invitations to attend important events and ceremonial functions. We have been fortunate in the past few years to have a substantive officer at D6 level serving as the Permanent Representative. The incumbent has made remarkable inroads into influential political, government and business circles. However, from an establishment point of view, the present situation is unsatisfactory. [that] We need to pitch the ranking of the post at the right level. We consider that the responsibilities of this post are on par with those at the AOSGA level in the civil service.

18. Accordingly, we propose to upgrade the Principal Representative (Tokyo) from AOSGB1 (D4) to AOSGA (D6).

Flexible Ranking

19. In July, 1991, Finance Committee approved the introduction of a flexible ranking system for directorate head and deputy head posts in the HKETOs [EC (1991-92) Item 18]. The system recognises that the substantive rank of directorate head and deputy head posts will continue to be the specific rank approved by Members having regard to functional considerations. However, to enable the Administration to have greater flexibility and choice of candidates when posting officers to fill directorate head and deputy head posts of overseas offices, the system allows for the creation of a supernumerary post at a pre-determined higher rank, held against the permanent post at the substantive rank. The application of the flexible ranking system is strictly prescribed by Members, as detailed in Enclosure 1.

20. When Members approved this system, there was no directorate head or deputy head post ranked at D6 level. If Members approve the proposals in this paper, we propose that Members also approve to extend the existing flexible ranking system to allow the creation of supernumerary posts at the next higher rank of Secy, GS (D8) to be held against the permanent posts of AOSGA (D6). We also propose that as with the existing flexible ranking system, SCS should be delegated the authority to create a higher rank post held against the permanent substantive post in strict accordance with the situations described in Enclosure 1.


21. The savings of the proposals in the foregoing paragraphs in notional annual salary cost at MID-POINT and full annual average staff cost are $246,600 and $311,844 respectively, calculated as follows -

Notional Annual Salary Cost at Mid-point
Full Annual Average Staff Cost
No. of Posts

Permanent posts




Less New permanent








22. The proposals will have no change on the existing establishment for non-directorate staff.


23. Hong Kong Government operates ten overseas ETOs. They are located in Washington DC, New York, San Francisco, Toronto, London, Geneva, Brussels, Tokyo, Singapore and Sydney.

24. The ETOs are responsible for safeguarding, representing and promoting Hong Kong’s economic and trade interests in their respective host countries. Staff at these offices identify, develop, and cultivate contacts with host governments and business and other relevant organisations in order to further Hong Kong’s trade and economic interests. They monitor and report on developments which are likely to affect such interests. They lobby and negotiate with their host governments on specific economic and trade issues and assist in the negotiation of trade and economic-related agreements. They also organise Hong Kong Government’s overseas publicity and public relations efforts to project Hong Kong as a reliable trading partner and a premier location for doing business.

25. Seven of the ETOs contain industrial promotion units which promote foreign direct investments in the manufacturing and services sectors in Hong Kong by publicising the attractions of Hong Kong.

26. If Members approve proposals in this paper, the substantive ranking of the heads of overseas offices will be as shown in Enclosure 2.


27. The Civil Service Branch (CSB) agrees that it is appropriate now to review the substantive ranking of Heads of Overseas Offices. The USA, Japan and UK are currently our most important overseas offices. It is necessary to ensure that the Heads of these offices are of sufficient experience and seniority to fulfil the roles demanded of them. The CSB agrees it is appropriate that their substantive rank thus be D6. Given the longish length of overseas postings, the need for flexibility and the limited pool of suitable officers, the CSB also agrees that flexible ranking system should be applied to these D6 posts.


28. The Standing Committee on Directorate Salaries and Conditions of Service has advised that the grading proposed for the permanent posts would be appropriate if the posts were to be created.

Trade and Industry Branch
April 1996

Enclosure 1 to EC(96-97)10

Flexible Ranking System for HKETOs

On 7 June 1991 and after considering EC (1991-92) Item 18, Members approved a flexible ranking system to facilitate the posting and retention of directorate heads and directorate deputy heads of overseas offices. Under this system, the substantive rank of each directorate head and deputy head post will continue to be the present rank which has been set with regard to functional considerations. However, the system will allow for the creation of supernumerary posts at the next higher rank, held against the permanent posts of the substantive ranks.

2. This system expanded the pool of potential candidates for overseas posts and removed a major disincentive for potential candidates by ensuring that officers in overseas posts receive the same opportunities for acting appointments and promotion as their counterparts in Hong Kong.

3. The system is applied in the following situations -

  1. the promotion of an officer during his overseas tour to a rank higher than the rank of the post he currently occupies;
  2. the posting overseas of an officer whose substantive rank, at the time of posting, is already higher than the rank of the post in the overseas office to which he is posted;
  3. the appointment of an officer to act in a rank higher than the rank of the post he occupies on being posted overseas, if it is considered that he would have been offered an acting appointment at that higher rank had he remained in Hong Kong; and
  4. the appointment of an officer already serving overseas in his own substantive rank to act in the higher rank if, in all likelihood, he would have been offered an acting appointment at the higher rank had he remained in Hong Kong.

4. The authority for selecting officers for acting appointments or for promoting them rests with the Posting Board or the Promotion Board, chaired either by the Chief Secretary or by the Secretary for the Civil Service.

Enclosure 2 to EC(96-97)10

Ranking of the Heads of Overseas Offices, upon approval of the proposals in this paper

Commissioner, USA


Minister, Washington AOSGB1 (D4)

New York


San Francisco
















* proposed ranking

Last Updated on 3 December 1998