HKCIEA’s Comment on 2020-21 Budget
In the 3rd Budget Speech of the term, the Financial Secretary commented the year of 2019 as an unsettling year fraught with obstacles, and in which the economic environment was thorny. Hence, the Budget of the year focuses on “supporting enterprises, safeguarding jobs, stimulating the economy and relieving people’s burden”. With challenges prevailing, the Government spends our ample fiscal reserve wisely by pumping big money to deal with the needs of the public and SMEs, while it also puts forward well-thought-out arrangements to support the community and enterprises and proposes comprehensive medium- long -term plans for the economy, making this Budget the most responsive one in recent years. We, the Hong Kong Chinese Imports’ & Exports’ Association welcome various relief and supportive measures proposed in the current Budget and in previous rounds.
With respect to alleviating business difficulties, we appreciate the Government for taking into account our suggestions, including the continuation of measures of the previous fiscal year; waiving business registration fees, rates for non-domestic properties and other government charges; introducing the new concessionary low-interest loan under the SME Financing Guarantee Scheme, under which 100% guarantee will be provided by the Government while a principal moratorium is available for the first six months which only interest payments have to be made. Such can guarantee the survival of businesses in the next half year and prevent a tide of closure from further burdening the people, and hence support enterprises and safeguard jobs.
We have been soliciting Government support for Re-industrialization in the previous years to address the excessive uniformity of Hong Kong’s industrial structure. We are glad for the Government’s injection of $2 billion into the ITF for launching the Reindustrialization- Funding Scheme to provide financial support for manufacturers to set up new smart production lines in Hong Kong, as well as the appropriation of $2 billion to the Hong Kong Technology Parks Corporation (HKTPC) for converting the old factory into one that provides modern manufacturing facilities. We encourage the Government to make more efforts in assisting the manufacturing industry and nurturing the prosperity of high value-added industries to realize economic transformation.
The Government shall also be complimented for deploying resources to plan for future developments of the port and logistics industry, the innovation and technology industry and the financial service sector etc. in addition to paying attention to current challenges. As to the proposal of using part of the Future Fund to set up the Hong Kong Growth Portfolio for direct investments in projects with a “Hong Kong nexus”, the Association looks forward to seeing its effect on enhancing Hong Kong’s competitiveness and stimulating long term development.
In terms of re-establishing the confidence of the international community in Hong Kong and rebuilding the place’s reputation, we welcome the Government’s response to suggestions and voices of the Association and the industries, as well as its corresponding allocation of $150 million to the Trade and Development Council for strengthening overseas support and promoting Hong Kong. However, although industries advise the Government on providing trade associations subsidies for organizing special activities during trade delegations to promote Hong Kong, it is regrettable that such advice was not taken.
Against the backdrop of the pandemic, Hong Kong is now experiencing an economic predicament while sluggish performance of the logistics, retail, and service industry can be expected. Being tied up with the catering and retail industry, the epidemic- stricken imports and exports industry, however, receives not much support from the Budget. We are hopefully expecting more timely measures to be introduced to mitigate the adverse impacts of the epidemic on the retail, import and export industry.
The Association believes that the $10000 cash payout to each eligible resident is going to be effective in stimulating local consumption. We hope that within 3 to 6 months, all applicants can register and receive money with the simplest and fastest process, such that the pressing needs of the public can be catered.
In all, this Budget is comprehensive and shows the Government’s ability in making innovative policies. As the society is going through unfavorable situations, the Government makes good use of our strong fiscal reserve to cater different needs of the society, notwithstanding a fiscal deficit. The Association certainly appreciates the Government’s devotion. It is also hoped that the Legislative Council will promptly review and pass the 2020/21 Budget, such that various measures can be implemented efficiently and benefit the public as well as the enterprises with the least delay possible.
The Hong Kong Chinese Importers’ & Exporters’ Association
February 26, 2020