SAR Chief Executive Tung Chee-hwa says he is confident Hong Kong can still hit its 5.5 per cent economic growth target for this year, despite the financial crisis gripping many parts of the region. He conceded that interbank rates had risen in Hong Kong when the local dollar came under pressure, but said the fear of higher interest rates was not an issue of big concern. 'The fundamentals in Hong Kong are very, very good,' said Mr Tung, after addressing the Singapore Chinese Chamber of Commerce. Mr Tung said the recent turmoil in financial and stock markets had come as a blow to many hopes in the region. 'We can burn the currency speculator, but the investor in need of cash to cover positions elsewhere has turned to our highly liquid market to find it,' he said. 'And all of our markets have suffered as overseas fund managers precipitately change their weightings in this region without taking time to weigh up the fundamentals. I trust the right lessons will be learned.' Mr Tung said Hong Kong had learnt a great deal the hard way from its stock market collapse in October 1987, when about 50 per cent of its market capitalisation disappeared almost overnight. 'We learned . . . that the proper response to these pressures is to regulate properly,' Mr Tung said. 'Our experience is that the risks of the open market can be managed by making the market operate as transparently and efficiently as possible, by maintaining financial discipline in the public sector, and by ensuring that financial institutions manage their investments and risks properly. 'The fundamentals of the Asian economies are good. We should not lose heart.'