SECRETARY FOR COMMERCE AND ECONOMIC DEVELOPMENT (in Cantonese):

President, Members, first of all, my thanks go to Mr YIU Si-wing for proposing the motion and also to Mr Frankie YICK for proposing an amendment.

 

Due to the Coronavirus Disease 2019 outbreak, the Hong Kong economy as a whole and various trades and industries have been affected considerably but to a varying degree. The Government very much understands, appreciates and sympathizes with this situation. Over the past year or so, we have continuously proposed many different solutions and discussed them with Members through this Council. In order to provide support for a myriad of industries (including some of the hard-hit industries mentioned by the two Members) to overcome the current difficulties, the Government has launched several rounds of support measures through the Anti-epidemic Fund and repeatedly discussed them in this Council and the Finance Committee to incorporate Members' views. These measures, for which we have obtained Members' support, involved no less than 128 projects, with a total commitment of over $160 billion. This year's Budget has also put forward a number of measures to continuously support economic recovery, including counter-cyclical measures at more than $120 billion to facilitate the gradual recovery of domestic demand in the period ahead, such as the disbursement of $5,000-worth electronic consumption vouchers as announced recently, in the hope of stimulating consumer sentiments across the board and restoring economic momentum.

 

As the epidemic is brought under control, the overall economy of Hong Kong is gradually bottoming out with trends of positive business outlook. The real economic growth of Hong Kong in the first quarter of this year showed a robust year-on-year growth of 7.9%. The total trade volume in the first quarter also reached a record high in recent years, and the latest unemployment rate has gradually dropped from a high of 7.2% some time ago to the latest level of 6% from March to May. Although the economy is showing signs of bottoming out, we certainly cannot ignore the fact that individual industries and the economy at large are still being affected by the changes in the pandemic and so, from an overall perspective, we still have to be very cautious.

 

In the areas under the purview of the Commerce and Economic Development Bureau, we have been paying special attention to several industries mentioned by the two Members earlier, including the travel trade and the Meetings, Incentives, Conventions and Exhibitions ("MICE") industry, and also to the economic impact on small and medium enterprises ("SMEs"). I will first brief Members on the key points of our work in these several areas, and the representatives of the relevant bureaux will listen and respond to Members' views pertaining to their respective areas of responsibility in tomorrow's meeting.

 

Affected by the anti-epidemic measures worldwide, the tourism industry is certainly the first to bear the brunt and has almost come to a standstill. With regard to the MICE industry, many events have been forced to be postponed or cancelled due to the restrictions imposed by the anti-epidemic measures. Both the number of participants and the scale of the events have been substantially reduced comparing to the time before the outbreak. In the meantime, SMEs have faced challenges in terms of capital, wages and market shrinkage during the epidemic, which have taken a toll on their business.

 

To assist the travel trade and the related industries, the Government has disbursed four rounds of subsidies through the Anti-epidemic Fund and increased the funding commitments for the Travel Agents Incentive Scheme and the Green Lifestyle Local Tour Incentive Scheme to the benefit of over 1 700 travel agents, around 21 000 practitioners, including travel agent staff, tourist guides, tour escorts and drivers of tour service coaches. Subsidies are also provided to 2 100 guesthouses and hotels as well as the cruise industry. The cumulative commitment for the relevant supporting measures accounts for about $2.6 billion in total, most of which has already been allocated for the assistance of the industries. In addition, the Government has also provided over 1 700 short-term jobs for practitioners in the travel trade to assist in the vaccination centres. Travel trade practitioners can also enrol courses provided by the Employees Retraining Board to upgrade their skills and receive a special short-term allowance.

 

With the stabilization of the epidemic, the Government is striving to strike a balance between fighting the epidemic and resuming economic activities, while making an effort to open up more room for the tourism trade to operate. We have adopted measures such as allowing resumption of the organization of local group tours with conditions in April and relaxing recently (with effect from 24 June) the maximum number of participants for tours with two thirds of the participants having received the first dose of the vaccine, as well as resuming "cruise-to-nowhere" itineraries hopefully at end July the earliest. In respect of the Air Travel Bubble between Hong Kong and Singapore, it is also hoped that the exact date of inaugural flights can be determined shortly.

 

As for the MICE industry, the Government has introduced the Convention and Exhibition Industry Subsidy Scheme through the Anti-epidemic Fund and announced recently that the Subsidy Scheme will be extended for six months until 30 June next year, with a view to attracting the return of major MICE events to Hong Kong for the benefit of the MICE industry and the related sectors. The Hong Kong Tourism Board will also provide support on various fronts, in order to strive for the return of past successful events to Hong Kong and continuously create business opportunities by inviting various professional sectors to organize more activities by all means when the epidemic subsides, with a view to laying the foundation for the future recovery of the tourism industry.

 

Many of the affected industries are SMEs. With regard to the SMEs, the Government is fully committed to helping them resolve their biggest financial problems and opening up business opportunities. In particular, we launched the special 100% guarantee product under the SME Financing Guarantee Scheme last April to provide low-interest loans to enterprises. So far, over 37 000 applications have been approved, involving close to $60 billion of loans. We have also enhanced these schemes by, among others, expanding the funding scope of the SME Export Marketing Fund to provide funding support for more enterprises to participate in promotional activities targeting the local and overseas markets, and also expanding the funding ceiling and coverage of the Dedicated Fund on Branding, Upgrading and Domestic Sales.

 

All these are examples of our responsive actions targeting the overall economy and individual industries in distress, but I agree with the two Members that we must properly prevent and control the epidemic, in order to overcome the current financial difficulties.

 

As the epidemic is becoming stable, the Chief Executive announced just this Monday that in accordance with the new direction in fighting the pandemic, we hope to adjust and relax the social distancing measures and quarantine arrangements in a more precise and focused manner. Our objective is to enable the people's lives and economic activities to resume gradually under the premise of effective prevention and control of the epidemic. Of course, it is most important that the rate of vaccination should be increased, in order to protect ourselves. This can also provide a better economic environment for us to gradually move towards a safer situation where the risks can be more properly controlled and also for the economic activities to achieve a full recovery.

 

President, the Secretary for Home Affairs, Under Secretary for Transport and Housing, and Under Secretary for Food and Health are also in the Chamber today. We will continue to listen to the views of Members tomorrow morning. The Under Secretary for Commerce and Economic Development and other colleagues concerned will subsequently respond to the issues raised by Members in their concluding remarks. Thank you, President.