Lee said any system introduced would be convenient, and a public consultation might be held to hear views from related sectors before it was drawn up.

The move follows the third evaluation of Hong Kong by the Financial Action Task Force - the international body promoting policies to combat money laundering - in 2008, which pointed to the city's lack of a system to detect or seize cash or financial instruments that might be involved in money laundering.

The government must submit its first progress report to the task force by the second quarter of this year.

Speaking after a meeting of the Fight Crime Committee yesterday, Lee said many overseas places required declarations of cross-border currency movements and the government realised it needed to review whether Hong Kong should follow suit to fulfil international obligations.

The tourism sector expressed concerns on Monday that restrictions on cash could hit spending by visitors, particularly by mainlanders, who typically carry large amounts of cash in preference to credit cards.

But the legislator representing the retail and wholesale sectors, Vincent Fang Kang, said yesterday the impact of the proposed declaration system on tourists' shopping in the city should not be large.

'Mainland tourists have many ways to obtain cash for spending in Hong Kong, and more tourists are using credit cards for payment,' Fang said.

But he said some shops selling popular goods might not allow customers to use credit cards, such as dried-seafood shops.

'Shops selling dried abalone and shark's fin are accustomed to receiving cash payment only,' he said.