Dr Fan, who was an executive manager for the Hospital Authority, began work as association head this week. The position has been vacant since March, when Dr Margaret Kwan Shuk-wa resigned.

Dr Kwan came under fire for saying that the artificial insemination programme should only be open to Chinese donors and recipients, in an interview with the Sunday Morning Post in September last year.

She said this was to reflect Chinese tradition and culture in a Chinese community in Hong Kong.

But Dr Fan said: 'We have proposed to the Government to expand the sperm bank to non-Chinese people. We applied to the Government for funding several months ago'.

'We need to provide counselling or body check-ups for couples involved and we need to arrange for donors to go through examinations. The expansion will definitely increase laboratory work and costs,' she said.

The association did not want to discriminate against expatriates.

Dr Fan said formerly only Chinese donors and clients were received, but the association had not received any non-Chinese donors or recipients yet, and she could not estimate the demand.

'We will continue our dialogue with the Government to discuss our priority services and how we should handle the situation in future.' She said the sperm would be labelled carefully. Characteristics of donors such as weight, height or skin and hair colour would be marked.

A lack of donors has been a problem for the sperm bank. Only 15 donors are available at the moment, but 220 couples are on the waiting list for artificial insemination.

A Department of Health spokesman said it had granted the association about $230,000 to subsidise its family planning, health, youth, medical and counselling services. She said the new funding application was being processed.

Derek Gould, acting Deputy Secretary for Health and Welfare, said it was too early to say whether additional funding would be granted.

'We do not believe we should restrict it if there is a demand,' he said.