FOREIGN exchange traders are facing the uphill task of re-establishing the industry's reputation after the recent clean-up by the securities watchdog, according to a leading dealer. Peter Wong Shiu-hoi, executive director of Tai Fook Securities, urged licensed forex traders to regain the confidence of retail investors since that was the only way to revive the sluggish industry. Even though the industry declined sharply because of continuous scandals and the mushrooming of cut-rate shops, Mr Wong was confident that retail forex trading had solid prospects after the massive clean-up by the Securities and Futures Commission (SFC) was finished. 'Forex trading is a necessity for this society, and people need to change money anyway. 'It is true that the number of customers has decreased sharply. But the number of competitors has also dropped.' The number of forex traders dropped from 300 in the early 1990s to about 30 traders after the Leverage Foreign Exchange Ordinance came into effect in September of last year. Unfair competition between licensed traders and unlicensed applicants was also scrapped when the SFC ordered the five unlicensed trader applicants to comply with the new rules earlier this month, he said. There had been complaints that unlicensed applicants were using lower margin requirements to lure away business from their licensed counterparts. Mr Wong said it was important for traders to co-operateand form a union. 'The number of forex traders is not large and we can deal with the authorities only when we have formed a union.' He believed the launch of rolling forex contracts by the Hong Kong Futures Exchange would not hamper the business of forex traders - which was already in the doldrums. 'Our company is also one of the market makers for the rolling forex contract. It is good for us to have a channel through which to hedge in the spot market.' He said that rolling forex was more likely to attract customers from banks because it was difficult for small investors to have a good spread while trading forex in banks.