Author Archives: hksar gov

     Following is a question by the Hon Kenneth Leung and a written reply by the Secretary for Security, Mr John Lee, in the Legislative Council today (November 28):

Question:

     In March this year, the Government set up a high-level inter-bureau and inter-departmental steering committee led by the Chief Secretary for Administration, and promulgated an Action Plan to Tackle Trafficking in Persons and to Enhance Protection of Foreign Domestic Helpers in Hong Kong (Action Plan) so as to tackle trafficking in persons (TIP) and enhance protection of foreign domestic helpers (FDHs). In this connection, will the Government inform this Council:

(1) in respect of the efforts made by various policy bureaux and government departments to implement the various measures under the Action Plan, of (i) the progress and effectiveness of such efforts and (ii) the additional manpower and other resources deployed, so far;

(2) of the number of persons, among those foreigners arrested in each of the past five years for suspected engagement in sex work, that were identified as TIP victims after going through the existing TIP victim screening mechanism (screening mechanism), and the follow-up actions taken by the authorities in respect of such victims;

(3) in respect of those persons mentioned in (2) who were not identified as TIP victims, of the measures put in place to ensure that such persons are not TIP victims as defined in the Palermo Protocol; whether it has reviewed if the screening mechanism can accurately identify this type of victims; if so, of the outcome; if not, the reasons for that;

(4) of the current number of foreign workers who have come to work in Hong Kong under the Supplementary Labour Scheme (the Scheme), together with a breakdown by trade; whether the Labour Department (LD) took the initiative, in the past five years, to investigate if the remuneration, working environment and assigned accommodation for such workers met the requirements of the Scheme and the labour legislation, so as to examine if they were subject to exploitation related to TIP or forced labour; if LD did, of the respective numbers of cases in which investigations were conducted and non-compliance/ contravention of the law was uncovered, as well as the respective numbers of the persons concerned who were given warning, prosecuted and convicted; if LD did not investigate, the reasons for that; and

(5) of the current number of FDHs working in Hong Kong; whether LD took the initiative, in the past five years, to investigate if the work arrangements and accommodation conditions of FDHs met the requirements of the employment contracts and the relevant legislation, so as to examine if they were subject to exploitation related to TIP or forced labour; if LD did, of the respective numbers of cases in which investigations were conducted and non-compliance/contravention of the law was uncovered, as well as the respective numbers of the persons concerned who were given warning, prosecuted and convicted; if LD did not investigate, the reasons for that?

Reply:

President,

     Trafficking in persons (TIP) is not prevalent in Hong Kong. However, the Hong Kong Special Administrative Region (HKSAR) Government never takes the matter lightly, and has been combating the crimes seriously through a multi-pronged approach.

     In order to provide high-level policy steer on the overall strategy and measures to tackle TIP and enhance protection of foreign domestic helpers (FDHs), the HKSAR Government established in March this year a high-level inter-bureau/departmental Steering Committee, which is chaired by the Chief Secretary for Administration, with the Secretary for Security and the Secretary for Labour and Welfare as vice chairmen. Membership of the Steering Committee includes heads of the Hong Kong Police Force (Police), Immigration Department (ImmD), Customs and Excise Department (C&ED), Labour Department (LD) and Social Welfare Department (SWD), as well as Director of Public Prosecutions of the Department of Justice (DoJ). At the same time, the Government promulgated the Action Plan to Tackle Trafficking in Persons and to Enhance Protection of Foreign Domestic Helpers in Hong Kong (Action Plan), which outlines a package of more than 30 multi-faceted measures (including more than 10 new measures and over 20 ongoing measures) that are comprehensive, strategic and targeted, covering multiple areas including victim identification, investigation, enforcement, prosecution, victim protection and support, prevention, and partnership with different stakeholders, etc.

     Our reply (prepared in consultation with the Labour and Welfare Bureau and LD) to Hon Leung’s question is as follows.

(1) Since the promulgation of the Action Plan, the Steering Committee has been taking forward the implementation of measures set out in the Action Plan.

     On victim identification, the Police extended the victim screening mechanism to cover all 24 police districts and relevant units in July this year. C&ED also fully implemented the screening mechanism within the department. To tie in with the extension of the mechanism, the Police had assigned one team from Organised Crime and Triad Bureau and one Regional Crime Unit from each of the six police regions as the dedicated teams to handle cases relating to TIP and exploitation of FDHs. Besides, ImmD, C&ED, LD and DoJ also appointed dedicated teams or officers to handle TIP and FDH exploitation cases so as to strengthen their co-ordination.

     On investigation, the “Inter-departmental Joint Investigation Team” (JIT) comprising the Police, ImmD, C&ED and LD continued to meet regularly to discuss the latest TIP trends and enforcement measures against TIP, exchange information as well as conduct joint investigations. To further enhance the effectiveness of joint investigations, JIT plans to develop an inter-departmental joint investigation mechanism to deal with relevant cases.

     The HKSAR Government also continued to foster closer partnership with other stakeholders. This year, the HKSAR Government actively participated in TIP-related campaigns organised by civil society and other sectors of the community, including the Launch of the Handbook on Initial Victim Identification and Assistance for Trafficked Persons and the International Conference on Combatting Human Trafficking 2018, etc. Moreover, the Inter-departmental Working Group on Trafficking in Persons (TIP Working Group) had also met with over 10 non-governmental organisations to exchange views on anti-TIP works.

     In addition, the Government has all along been providing relevant training to officers of law enforcement agencies (LEAs), LD, SWD and prosecutors of DoJ. The number of officials receiving training has been increasing over the years. During the first nine months of 2018, about 1 800 officers from the Security Bureau and LEAs, DoJ, LD and SWD, the Hospital Authority and the CEASE Crisis Centre (Note) received local or overseas TIP-related training. Among them, the Hospital Authority and the CEASE Crisis Centre participated in such anti-TIP training for the first time. Meanwhile, LEAs continued to actively participate in international or regional conferences and workshops to identify the best practice against TIP.

     Other new measures under the Action Plan will be launched gradually. Taking into account the implementation situation of the Action Plan, relevant departments will seek resources under the existing mechanism where necessary.

(2) and (3) One of the key tasks in combating TIP is to keep strengthening and improving the mechanism for identifying victims. ImmD first launched a TIP victim screening mechanism in 2015. The mechanism was then gradually extended to some police districts of the Police and some formations of the C&ED in 2016 and 2017. 

     In July 2018, the Police extended the victim screening mechanism to cover all 24 police districts and relevant units, and C&ED also implemented the screening mechanism department-wide. Under the mechanism, Police, ImmD and C&ED officers will conduct screenings on vulnerable persons (for example, illegal immigrants, sex workers, illegal workers, FDHs, imported workers, etc., as well as other suspected victim cases) who are arrested or who report themselves as victims to the authorities.

     Although the Palermo Protocol has not been applied to Hong Kong, the screening conducted by LEA officers follows the definition of TIP set out in the Palermo Protocol, including whether threat and coercion are involved in the victim recruitment and whether they have been exploited. In 2016, 2017 and 2018 (January to September), respectively 2 515, 4 710 and 5 308 screenings were conducted on vulnerable persons (including sex workers) under the abovementioned victim screening mechanism. In the same period, a total of 29 persons were identified as victims, and three of them involved TIP for the purpose of sexual exploitation or prostitution as referred to in the Palermo Protocol.

     Identified TIP victims will be referred to relevant departments for follow-up actions and will be provided with necessary protection and support according to their individual situations, such as urgent intervention, medical services, counselling, shelter and other supporting services.

     The TIP Working Group and LEAs will review the victim screening mechanism and the checklist of screening questions from time to time in response to crime trends, departmental operational experience, and feedback from civil society organisations, etc. Improvement measures will be introduced as needed to ensure that the screening mechanism remains effective.

(4) According to available information, the number of imported workers working in Hong Kong under the Supplementary Labour Scheme (SLS) and the breakdown by job title as at end-October 2018 are set out in Annex 1.

     The Government attaches great importance to protecting the employment rights of imported workers. Both imported workers and local workers are comprehensively protected by the labour laws of Hong Kong. In addition, imported workers and their employers are required to enter into a Standard Employment Contract (SEC) prescribed by the Government for the purpose of SLS. Labour inspectors of the LD carry out inspections of the workplaces and accommodation of imported workers from time to time and conduct interviews with imported workers individually without interference of any third party (including employers). During interviews with imported workers, labour inspectors inquire of and explain to them their rights and benefits under the Employment Ordinance (Cap 57) (EO) and SEC. At the same time, labour inspectors check whether the employers have complied with relevant labour laws and terms of SEC by examining imported workers’ wage and attendance records, employment records and the employees’ compensation insurance policy, etc. Moreover, labour inspectors provide an information card with contact telephone numbers of LD and relevant law enforcement departments/organisations to imported workers to facilitate their enquiries or complaints with these parties in future.

     From 2013 to 2017, labour inspectors conducted a total of 3 368, 3 256, 3 236, 3 653 and 4 976 inspections in the respective years in handling cases of imported workers. If an employer is suspected of breaching the EO or SLS requirements, LD would conduct prompt investigation. Depending on the circumstances of the breaches, LD would issue written warnings to the employers concerned, and prosecutions would be taken out against the offending employers where there is sufficient evidence and the imported workers agree to act as prosecution witnesses. From 2013 to 2017, LD issued a total of 301 written warnings to employers of imported workers and successfully prosecuted three employers.

     Imported workers can call LD’s 24-hour hotline or the hotline of SLS to lodge complaints if their employers are suspected to have breached the labour laws or SLS requirements. LD will conduct in-depth investigation into complaints received.

(5) According to available information, as at end-October 2018, there were 385 141 FDHs in Hong Kong.

     The Government has all along been firmly committed to protecting FDHs’ employment rights and benefits and the support provided to them, and does not tolerate any abuse of FDHs. LD has been enhancing through different means FDHs’ awareness of their rights and benefits as well as of the channels through which they may seek assistance, for example through distributing information packs to FDHs arriving at the Hong Kong airport, staging information kiosks at popular gathering places of FDHs on their rest days, publishing promotional materials, and producing promotional videos, etc. LD also maintains close collaboration with the governments of FDHs’ home countries and their consulates-general in Hong Kong, and regularly participates in the welcoming programmes organised by the consulates, in order to enhance the awareness of newly-arrived FDHs about their statutory rights and benefits as well as channels to seek assistance. 

     LD has not entered the places of work and residence of FDHs for inspections as such places are the private residences of their employers. The Government encourages FDHs who suspect their rights and benefits being infringed to seek assistance as soon as possible so that relevant government departments can investigate and follow up. Apart from the branch offices of its Labour Relations Division, LD also provides a 24-hour hotline as well as online forms on the dedicated FDH and Employment Agency (EA) Portals so that FDHs can send in enquiries and lodge complaints about matters related to their employment rights and benefits and EAs more conveniently. 

     Figures related to LD’s enforcement against FDH employers and EAs from 2013 to 2017 are set out in Annex 2. In addition, since the promulgation of the Code of Practice for EAs in January 2017 and up to end-September 2018, LD issued a total of 47 written warnings to EAs.

Note: The CEASE Crisis Centre, operated by non-governmental organisation, provides crisis intervention and support services which aims to serve victims of sexual violence and individuals/families encountering domestic violence or other family crises. The support services include 24-hour hotline service, outreaching service and short-term accommodation service. The CEASE Crisis Centre is one of the designated crisis intervention and support services centre for handling TIP victim cases and such services are fully funded by the SWD. read more

     The Government will publish the Fire Safety (Industrial Buildings) Bill in the Gazette this Friday (November 30).

     A spokesperson for the Security Bureau today (November 28) said, “The objective of the Bill is to bring the fire safety of old industrial buildings (IBs) up to present-day standards for better protection of life and property of the public.” 

     The fire safety measures in existing buildings generally meet the standards prevailing at the time of their construction. Pursuant to the Buildings Ordinance, the planning, design and construction of a building is required to comply with the Ordinance and its subsidiary legislation. However, the fire safety standards of old buildings may fall short of the standards prescribed in the prevailing Codes of Practice published by the Fire Services Department (FSD) and the Buildings Department (BD). For example, pre-1987 industrial buildings may not be equipped with automatic sprinkler systems.

     “Fires at certain old IBs in recent years have heightened public concern over their fire risks,” the spokesperson added.

     The Director of Fire Services and the Director of Buildings are the enforcement authorities under the Bill. The Bill will empower them to inspect the target IBs and issue fire safety directions to require the owners or occupiers to upgrade the fire service installations or equipment, or fire safety construction of such buildings to the required standards. Depending on the actual circumstances, improvement measures include installation of automatic sprinkler systems, provision of sufficient directional and exit signs, provision of secondary source of electrical power supply, provision of fire hydrant and hose reel systems, provision of adequate means of escape, and provision of fire-resistant construction to inhibit the spread of fire and ensure the structural integrity of the buildings. The owners or occupiers must comply with the requirements within the time limit as stipulated in the directions. 

     To ascertain the technical feasibility of the proposed fire safety requirements in pre-1987 IBs, the FSD and BD have jointly conducted a study, using three IBs of different ages as test cases. The study reveals that it is generally feasible to carry out the proposed improvement works for pre-1987 IBs, except that the building structure and actual circumstances would make it difficult for these buildings to add firefighting and rescue stairways or to provide refuge floors or staircase interchanges. The Bill will therefore not seek to impose such requirements on the owners.

     According to the BD’s record, around 1 100 IBs will be subject to the regulation of the Bill. Upon passage by Legislative Council (LegCo), the Bill will be implemented in two phases, starting with some 400 IBs which were constructed or had their building plans submitted in or before March 1973. The majority of these IBs are not sprinkler-protected. 

     The Bill will be introduced into the LegCo for the First Reading and the Second Reading on December 12. read more

     The effective exchange rate index for the Hong Kong dollar on Wednesday, November 28, 2018 is 106 (up 0.1 against yesterday’s index). read more

     Following is a question by the Hon Tony Tse and a written reply by the Secretary for Development, Mr Michael Wong, in the Legislative Council today (November 28):
 
Question:
 
     It has been reported that since the Hong Kong-Zhuhai-Macao Bridge (HZMB) opening to traffic on the 24th of last month, a large number of Mainland residents have joined tour groups to Hong Kong that enter and exit Hong Kong on the same day through HZMB. Most of them are arranged to go to Tung Chung, which is close to the HZMB Hong Kong Port, for free activities because visiting time is limited and they are not received by any local travel agency. As a result, the catering, shopping, tourist and transport facilities in the district are overwhelmed, and the daily lives of the residents in the district are seriously affected. Some members of the public have pointed out that the aforesaid situation reflects an oversight of the Government in planning for the ancillary facilities needed for major infrastructure projects. In this connection, will the Government inform this Council:
 
(1) whether, before the opening of the HZMB to traffic, it had assessed the number of tourists travelling to Tung Chung after their entry into Hong Kong through the HZMB and such tourists’ impact on the residents in the district, and formulated mitigation measures; if so, of the assessment outcome and the mitigation measures, and the discrepancies between the assessment outcome and the actual situation; if not, the reasons for that; 
 
(2) given that the Civil Engineering and Development Department is currently conducting the Study on Traffic, Transport and Capacity to Receive Visitors for Lantau and carrying out jointly with the Planning Department the Planning, Engineering and Architectural Study for Topside Development at Hong Kong Boundary Crossing Facilities Island of Hong Kong-Zhuhai-Macao Bridge, of the commencement dates and the latest expected completion dates of these studies; 
 
(3) given the recent intake of residents of a new public housing estate in Tung Chung, whether the authorities have provided the ancillary facilities needed for the additional population and tourists in Tung Chung; 
 
(4) whether it has assessed the daily number of tourists entering Hong Kong through the HZMB who will travel to Tuen Mun and other districts in New Territories West upon the full opening of the Tuen Mun-Chek Lap Kok Link to traffic; if so, of the number; whether it will provide the ancillary facilities needed for those tourists; if so, of the details; and
 
(5) whether it will, by learning a lesson from the situation that various problems were encountered when the HZMB opened to traffic, improve the planning work for other major infrastructure projects in future, with a view to making it more people-oriented, so that priority is accorded not only to transport infrastructure development but also to the provision of ancillary facilities?
 
Reply:
 
President,
 
     The Government has been monitoring closely the vehicular and visitor flows crossing the boundary through the Hong Kong-Zhuhai-Macao Bridge (HZMB) and the operation of the Hong Kong Boundary Crossing Facilities (BCF) since the commissioning of the HZMB.  In view of the recent situation in Tung Chung, the Government has rolled out multi-pronged measures within a short time to help alleviate the pressure of the BCF and its nearby areas, improving the relevant situation.
 
     Having consulted relevant bureaux and departments, my consolidated reply to the question raised by the Hon Tony Tse is as follows: 
 
(1) When carrying out feasibility studies for the HZMB, the consultants have estimated the amount of passenger traffic, including the number of passengers travelling among Hong Kong, Zhuhai and Macao using the HZMB. However, the forecast of passenger traffic cannot estimate the final destinations of the passengers. In fact, the forecasted passenger flow may also vary as a result of external factors such as the respective further developments of the three places and new planning initiatives.
 
     In view of the recent situation in Tung Chung, the Government has called various inter-departmental meetings to tackle the matter. Based on the experience gained from the past few weekends, around one-fifth of visitors arriving at Hong Kong through the HZMB BCF did not leave the BCF to visit other districts in Hong Kong by taking local public transportation. This indicates that many of the visitors arriving at Hong Kong through the HZMB BCF mainly intended to visit the HZMB itself and might not enter Hong Kong. The Government is exploring with relevant Mainland authorities the opening of the HZMB’s East Artificial Island to the aforementioned group tourists, so as to allow such tourists to visit the HZMB and return to Zhuhai or Macao from the East Artificial Island without crossing the boundary of the Hong Kong Special Administrative Region.
 
     In addition, the Government is arranging for setting up temporary small-scale shops or booths in the HZMB BCF’s Passenger Clearance Building to allow travellers to buy souvenirs. We are also exploring the introduction of food trucks to serve travellers near the BCF’s Passenger Clearance Building and in Sunny Bay.
 
     Besides, the Transport Department (TD) implemented new measures concerning the operating arrangements of domestic tour coaches at the BCF on November 21. Under the new measures, registered coach operators could enter the BCF pick-up area to pick up passengers on any day provided that they had submitted an application and completed certain simple procedures via the TD’s online system by 9pm the prior day. This arrangement helps Hong Kong receiving travel agents and Mainland inbound travel agents establish co-operation, so as to reduce the influx of visitors into Tung Chung through flexible deployment of tour coaches.
 
     Furthermore, shuttle bus operators launched an online booking system on November 23 to allow travel agents or organisers of tour groups to purchase shuttle bus tickets (including return tickets in one single operation) for designated dates and time slots starting from November 24. The new arrangement helps manage and regulate visitor flows at all time slots, thereby preventing group visitors from entering and leaving Hong Kong at the same time, as well as reducing the waiting time of visitors.
 
     In view of the large number of passengers going to Tung Chung, the bus company concerned has implemented a series of measures starting from November 10 to improve the queuing arrangement of Route B6 at Tung Chung, including arranging passengers to buy return tickets in advance, arranging two buses at a time for passengers to get aboard, and deploying more staff to facilitate passengers to get aboard. These measures have shortened the time for boarding the buses and there was no long queue during most of the peak hours. Besides, setting barriers at the bus stop has allowed the queues to proceed in an orderly manner. The TD and bus companies will continue to closely monitor the demand of various feeder bus routes and take appropriate measures as necessary.
 
     In parallel, the Tourism Commission (TC) has assisted in co-ordinating the local trade to smoothen visitor flow near the BCF, including requesting the local trade to arrange travellers to use other means of transport (such as cross-boundary ferries) as far as practicable. The TC also encourages the trade, including tourist attractions, to launch travel itineraries and products such as half-day tours, so as to help divert travellers.
 
(2) The “Study on Traffic, Transport and Capacity to Receive Visitors for Lantau”, which is being carried out by the Civil Engineering and Development Department (CEDD), commenced in mid-2017 and is expected to complete in 2019. In addition, the “Planning, Engineering and Architectural Study for Topside Development at Hong Kong Boundary Crossing Facilities Island of Hong Kong – Zhuhai – Macao Bridge” carried out by the CEDD and the Planning Department commenced in 2015. Meanwhile, the Government has invited the Airport Authority Hong Kong (AAHK) to submit a proposal for the topside development at the Hong Kong Boundary Crossing Facilities Island. Upon the submission of development proposal by the AAHK, the Government will consider it in detail and formulate the planning and uses of the topside development at the Hong Kong Boundary Crossing Facilities Island.
 
(3) In respect of Tung Chung New Town Extension (TCNTE), we will follow the planning concept of a balanced community in Tung Chung when taking the project forward. Apart from providing some 49,000 new public/private residential units, the project will also provide over 870,000 square metres commercial floor space for office, retail, dining and hotel uses. To cope with the needs arising from the TCNTE, two new railway stations (Tung Chung East and Tung Chung West) will be constructed. We have also reserved sufficient land for the development of social welfare, recreation and education facilities. The reclamation works in Tung Chung East commenced in end-2017. We expect the first population intake in around 2023/24 the earliest. Relevant government departments will implement the above facilities gradually taking account of the progress of the TCNTE project.
 
(4) As explained in (1) above, the forecast of passenger traffic has only assessed the number of passengers travelling among Hong Kong, Zhuhai and Macao using the HZMB.
 
     The mainline of Tuen Mun – Chek Lap Kok Link (TM-CLKL) Southern Connection, i.e. the part connecting to urban bound of the North Lantau Highway, was commissioned to dovetail with the commissioning of the HZMB on October 24 to facilitate the public going to the HZMB and also to relieve the traffic burden on the road network on Airport Island brought about after the commissioning of the HZMB. The part of the TM-CLKL Southern Connection connecting to the Tung Chung bound of North Lantau Highway is being strived to commission within 2018. The TM-CLKL Northern Connection is anticipated to be completed by 2020 the earliest.
 
     Upon the commissioning of the whole section of the TM-CLKL, there will be an alternative route going between the Hong Kong Port and other areas of Hong Kong, alleviating the pressure borne by the Lantau Link. The TD and relevant public transport operators will review public transport services and arrangement in the areas concerned and will consult relevant District Councils and stakeholders, striving to provide efficient public transport services to the public. The TC will also keep a close eye on the travel trends of Mainland tourists, and report destinations that the latter tend to visit to District Offices and other relevant departments in various districts for advance planning. The Food and Environmental Hygiene Department, the Agriculture, Fisheries and Conservation Department, and the Leisure and Cultural Services Department will from time to time review their site management and staffing mechanism. These include stepping up inspection at popular destinations during peak arrival seasons of Mainland tourists, advising and educating individuals involved in inappropriate behaviours and to take enforcement actions against violations as appropriate, and at the same time stepping up site cleansing and crowd management, so as to minimise the impact of relevant activities on the districts concerned
      
(5) When implementing large-scale infrastructure projects, relevant Government departments will take into account a host of factors for providing ancillary facilities of the new development project, and engage consultants to conduct impact assessments and detailed studies. In planning the ancillary facilities of large-scale infrastructure, the Government will from time to time fine-tune the public transport service level and arrangements of other ancillary facilities under planning in response to the development of society and public transport service networks, and other changes, as well as establishing contingency plans to ensure that new infrastructure projects are able to meet the expected transport demand and tackle the challenges from new developments and changing circumstances. read more

     Following is a question by the Hon Jeffrey Lam and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (November 28):
 
Question:
 
     Since July this year, the authorities of the United States (US) have imposed, one after another, additional tariffs of 10 per cent or 25 per cent on imports from China of a total worth of US$250 billion. They have also indicated that the rates of the additional tariffs will be raised to a flat rate of 25 per cent with effect from January 1 next year. In response, the authorities of China have concurrently imposed additional tariffs of 5 per cent to 25 per cent on imports from US of a total worth of US$110 billion. Among the goods affected by the additional tariffs, those from China and re-exported to US via Hong Kong were worth over HK$130 billion in total, accounting for about 3.5 per cent of the value of Hong Kong’s total exports of goods last year. The Government anticipates that the Sino-US trade conflicts will have significant impacts on Hong Kong’s economy next year. Some members of the business sector hope that the Government will step up its efforts to support Hong Kong enterprises to weather the difficult time. In this connection, will the Government inform this Council:
 
(1) as the special enhanced measures, introduced this year by the Hong Kong Export Credit Insurance Corporation in response to the Sino-US trade conflicts to support exporters, will expire on June 30 next year, whether the authorities will (i) regularise these measures, (ii) raise the limit for the insured amount and increase the pre-shipment cover, and (iii) expand the scope of coverage to include exporters with annual sales turnover of $50 million or more and goods exported to overseas markets other than US;
 
(2) as quite a number of enterprises have relayed that financial institutions have recently kept lowering the credit facilities granted to them, thereby seriously affecting their cash flow, whether the authorities will consider re-launching the Special Loan Guarantee Scheme under which the Government will provide a loan guarantee of $100 billion so as to assist Hong Kong’s manufacturers and exporters in their financing; and
 
(3) regarding the impacts on the economy of Hong Kong brought about by the US authorities’ measure of raising across the board the rates of the additional tariffs on imports from China with effect from January 1 next year, of the outcome of the authorities’ latest assessment, and whether they have formulated further measures to assist Hong Kong enterprises in weathering the challenges concerned?
 
Reply:
 
President,
 
     Our consolidated reply for the three parts of the question is as follows:
 
     Since the beginning of this year, the United States (US) has, in tranches, imposed additional tariffs at 10 per cent or 25 per cent on a total of US$250 billion worth of Mainland imports. In response, the Mainland has imposed additional tariffs at 5 per cent, 10 per cent or 25 per cent on US$110 billion worth of US imports. In respect of the US and Mainland’s tariff lists, a total of HK$185.7 billion of the concerned products were re-exported via Hong Kong, accounting for 4.8 per cent of Hong Kong’s total exports of goods in 2017. Apart from re-export trade, the tariff measures also affect Hong Kong’s offshore trade involving Mainland products destined to the US as well as other economic activities that support China-US trade.
 
     In addition, the China-US trade conflict has also affected international trade and investment activities, the global financial market and the overall economic sentiment, indirectly affecting all aspects of the Hong Kong economy, and the impact has begun to emerge. If the US raises the tariff level on the US$200 billion worth of Mainland imports from the current 10 per cent to 25 per cent from January 2019 as it announced earlier, the negative impact on the global economy, financial market as well as Hong Kong’s economy would be more significant.
 
     The Government has been closely monitoring developments of the China-US trade conflict and their impact on Hong Kong economy, maintaining close communication and exchanging information with the trade, and discussing with them on how to respond. The Commerce and Economic Development Bureau and the Trade and Industry Department (TID) have met with major local chambers and associations of small and medium enterprises (SMEs) many times to gauge their views on the tariff measures and jointly assess their impact on the trade. TID has also set up a dedicated liaison platform for better communication with and dissemination of information to the trade.
 
     In the short term, the Government understands that the trade is particularly concerned about export credits and financing, especially for SMEs which are more susceptible to external factors. Therefore, the Government has promptly responded to the trade’s need and introduced a number of short term measures, including:
 
(i) The Hong Kong Export Credit Insurance Corporation has introduced in phases special enhanced measures to strengthen protection for Hong Kong exporters affected by the US tariff measures, including providing six free buyer credit assessments for each Hong Kong exporter; providing 30 per cent discount on premium for “Small Business Policy” (SBP) holders (i.e. Hong Kong exporters with annual sales turnover less than $50 million); increasing the credit limit for SBP holders by 20 per cent to a maximum of $5 million; and providing free pre-shipment cover for SBP holders affected by the US tariff measures;
 
(ii) The application period for the special concessionary measures under the SME Financing Guarantee Scheme operated by the HKMC Insurance Limited has been extended to June 30, 2019. In addition, to further alleviate the financing burden of local enterprises and assist them to obtain financing from lending institutions, three additional support measures have been launched from November 19, 2018, i.e. reducing the annual guarantee fee rate by 50 per cent; increasing the maximum facility amount from $12 million to $15 million; and lengthening the maximum guarantee period from five years to seven years;
 
(iii) TID has been strengthening the dissemination of information in respect of the Hong Kong rules of origin to the trade and following up with the trade on the related review; and
 
(iv) The Hong Kong Trade Development Council (TDC) organises free seminars to help the trade understand the relevant trade measures and possible responses, and will also continue to help the trade develop emerging markets and transfer production base through organising trade missions, business matching services, etc.
 
     In addition, the Government has also strengthened support to the trade in developing markets. The Government has advanced the launch of the ASEAN Programme under the Dedicated Fund on Branding, Upgrading and Domestic Sales (BUD Fund) to August 1, 2018 to provide funding support to individual non-listed Hong Kong enterprises to undertake projects for enhancing their competitiveness and furthering business development in the ASEAN market. Enterprises can obtain a maximum funding of $1 million on a matching basis for carrying out up to 10 ASEAN projects, with the funding ceiling per project being $1 million. In addition, to strengthen support to SMEs in exploring new markets and new business opportunities, the cumulative funding ceiling per enterprise for the current SME Export Marketing Fund and the Mainland Programme under the BUD Fund has been doubled, i.e. from $200,000 and $500,000 to $400,000 and $1 million respectively.
 
     In the medium to long term, the Government will continue to adopt a multi-pronged approach. We will continue to establish stronger bilateral ties with like-minded trading partners and deepen Hong Kong’s economic integration with different parts of the world through negotiating and forging free trade agreements and investment agreements. We will expand our overseas Economic and Trade Office coverage to new partners and markets with close economic and trade relations with Hong Kong and with development potential, so as to tap business opportunities and boost foreign direct investment into Hong Kong. We will continue to organise business missions with the TDC for the trade to explore business opportunities in new markets. We will also continue to assist the trade in grasping the opportunities brought by the Belt and Road Initiative and the development of the Guangdong-Hong Kong-Macao Greater Bay Area.
 
     The Government takes into account the trade’s situation and needs when implementing various measures. We will continue to closely monitor developments and maintain close communication with the trade. We will also keep reviewing our support measures to the trade, particularly SMEs, to ensure that they are appropriate. read more