Following is a question by the Hon Tony Tse and a reply by the Secretary for Transport and Housing, Mr Frank Chan Fan, in the Legislative Council today (November 20):

Question:

    In this year's Policy Address, the Government put forward a plan to increase the number of transitional housing projects substantially to provide a total of 10 000 transitional housing units within the coming three years, and indicated that it had earmarked $5 billion for meeting the costs. In this connection, will the Government inform this Council:

(1) of the following details of each project (set out in a table): the location, the floor or site area, the parties owning the titles to the premises or site, the number of housing units that can be provided, the name of the operator, as well as the anticipated dates for completion and intake of residents;

(2) as some members of the construction sector have relayed that the construction standards to be met by transitional housing projects are quite high, resulting in high construction costs and long construction time, whether the Government has assessed if the earmarked provision of $5 billion will be sufficient for meeting the expenditure, and whether it will relax the relevant construction standards; and

(3) given that community groups have been/will be responsible for all the tasks, from the construction or conversion works to the management and operation of the various transitional housing projects, how the Government ensures that all such projects will be completed on schedule, so as to achieve the target of providing 10 000 housing units within three years; of the reasons why the Government does not directly undertake such tasks?

Reply:

President,

     Having consolidated the information provided by the Development Bureau and relevant departments, set out below is my consolidated reply of the question raised by the Hon Tony Tse:
     
     The continued increase in land and housing supply remains the fundamental solution to resolve insufficient housing supply. Quality living is the cornerstone for ensuring social stability and the Government will continue to identify land for housing construction to rectify the housing problem with the greatest effort.

     On transitional housing, we have earlier announced the provision of a total of over 6 000 units in three phases. The first phase, which includes the Community Housing Movement, commenced in 2017. Up to now, about 620 units have been provided in existing residential buildings, benefiting about 1 000 families. In the second phase, provision of about 960 units was announced, with intake of residents yet to commence.  For details of these projects, please refer to Annex 1.
     
     Projects which provide approximately 4 500 units in the third phase were also announced at the "Symposium on Connecting and Co-creating of Transitional Housing" early this month. These projects include those to be participated by the private developers, the Hong Kong Construction Association etc.. Together with those 1 580 units with resident intake completed or projects announced in the first and second phases, the three phases will provide over 6 000 units in total.
     
     The task force under the Transport and Housing Bureau (THB) is now examining the feasibility of building large-scale transitional housing estates on a number of short term idle government and private sites with different community groups, private developers and professional/technical organisations. Details, when available, will be announced by the relevant organisations in due course. Subject to the progress with relevant procedures and local view, and taking into account the 6 000-odd units being occupied or having been announced, it is estimated that about 10 000 transitional housing units can be provided in three years.
     
     On construction costs, the total financial subsidy for each transitional housing unit shall not exceed: (a) $200 000 for each unit in vacant residential buildings; and (b) $550 000 for each unit to be provided through erection of temporary structure on vacant lands or in non-residential buildings. This capital amount is estimated with reference to all the projects underway and is believed to suffice in meeting the construction costs. More importantly, the construction of modular housing can be reused, they can be relocated to other developments upon disassembly. In fact, modular housing can have a decades-long lifespan. It is an efficient, economic and environmentally friendly construction method for increasing the supply of transitional housing.
     
     As regards construction standards, the construction of transitional housing must comply with the structural safety, fire and the associated building regulations. The safety and hygiene standards of transitional housing will not be inferior to the current standards applicable to other permanent residential buildings with the same design. Nevertheless, with the concerted efforts of the task force and the earnest collaboration among relevant departments, application procedures are simplified as far as practicable, thus facilitating and expediting approval and implementation for various projects.
     
     A cross-sector collaboration is one of the features of transitional housing. The initiative is rolled out under the active facilitation by the Government and close collaboration between the community and the Government throughout the process from policy inception to project implementation. Apart from exercising flexibility in utilising social resources for the provision of various types of transitional housing for the community, participating organisations can provide appropriate support for residents according to their needs. We will continue with our communication with the community and make use of the potential and resources in the community outside the Government, to offer flexible and multiple social services. 
     
     On monitoring and implementation of the funding scheme, we will vet applications and oversee the progress of projects to ensure that the projects are carried out in line with the principles of economy, efficiency and effectiveness in the use of resources thereby achieving good value for money. To ensure transparency and accountability on the use of the grants under the funding scheme, the Government will submit an annual report on the approved applications and implementation progress of projects to the Panel on Housing.
     
     While it is a challenge to provide 10 000 transitional housing units within three years, as long as we work together with concerted efforts, we have confidence to overcome the difficulties and accomplish the mission.

     Following is a question by the Hon Jimmy Ng and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (November 20):
 
Question:
 
     The Government has extended the Food Truck Pilot Scheme, which was launched in February 2017, by two years to February 2, 2021.  Under the licensing conditions, the 15 food trucks may operate only at (i) designated operating locations on a rotation basis or (ii) venues of self-identified events that meet specific conditions (i.e. being open to the public, having publicity plans and appropriate licences for which having been obtained). It has been reported that the number of tourists and local residents visiting various operating locations has been dropping continuously since the eruption of the disturbances arising from the opposition to the proposed legislative amendments. To reduce their losses, operators of food trucks designated to operate at locations with low people flow have opted not to do business instead. In the past few weeks, among the 11 operating locations, there were only four locations, at the most, in a week the food trucks at which were open for business, and some of the food trucks were open for business from Friday to Sunday only. Some food truck operators have criticised that as the authorities do not understand the operating difficulties of food trucks and ignore the aspirations of the operators, it is difficult for their food truck business to sustain.  In this connection, will the Government inform this Council:
 
(1) whether it has conducted studies to look into the causes for the great variances in (i) the business performance of the food trucks and (ii) their business performance at different operating locations; if so, set out the relevant information in a table; if not, whether it will conduct such studies;
 
(2) whether it has compiled statistics on (i) the volume of people flow at the various designated operating locations and (ii) the turnover of the food trucks, at different hours and during various events; if so, set out the relevant information in a table; if not, whether it will compile such statistics;
 
(3) whether it will relax the relevant licensing conditions so as to give the food trucks greater room for survival, e.g. allowing, on the premise of not affecting the traffic and the business situation of eateries in the vicinity, the food trucks to participate in private parties which are not open to the public, so as to offset the losses incurred by their operation at the designated operating locations; if so, of the details; if not, the reasons for that;
 
(4) given that the Government announced in October this year the reduction by half in the rentals payable by the food trucks for operating at Government venues, whether it will consider negotiating with the management of the designated operating locations which are not Government venues (including the Hong Kong Disneyland, Ocean Park, Golden Bauhinia Square, and Central Harbourfront Event Space) to offer rental reduction of the same rate to food trucks operating at such venues; if so, of the details; if not, the reasons for that; and
 
(5) whether it will remove those operating locations with lower people flow and poorer business performance for food trucks, and introduce new operating locations; if so, of the details; if not, the reasons for that?

Reply:
 
President,
 
     The two-year Food Truck Pilot Scheme (the Scheme), launched on February 3, 2017, aims to enhance the fun and vibrancy of tourist attractions in Hong Kong by providing diverse, creative and high quality gourmet food to tourists and the locals. After evaluating the operation of the Scheme, the Tourism Commission (TC) decided to extend the Scheme for two more years up to February 2, 2021 with a view to allowing sufficient time for the Scheme to be tested out in the market.
 
     In view of the business performance of the food trucks and in response to the views on the Scheme, TC has rolled out a number of refinement measures since end May 2017 to enhance the operation flexibility of the Scheme as far as possible in order to help improve the business environment. The measures include:

(1) introducing new operating venues, namely the Science Park, the AsiaWorld-Expo, the Hong Kong University of Science and Technology, the Hong Kong Science Museum, the Hong Kong-Zhuhai-Macao Bridge Hong Kong Port and the Tai Po Waterfront Park in addition to the eight original operating venues;
 
(2) providing a more flexible shift arrangement for food trucks to operate in Energizing Kowloon East Venue 1 in the daytime and shift to Tsim Sha Tsui Art Square in the evening, and allowing operators to bid for vacant pitches by drawing lots or on a first-come-first-served basis;
 
(3) allowing food trucks to participate in self-identified events. TC will consider these events positively as long as they are open to the public with publicity plans available and obtained appropriate licences (e.g. temporary places of public entertainment licence).  TC also encourages relevant Government departments to consider engaging food trucks in events organised or sponsored by them;
 
(4) allowing the operators to opt whether to operate at the designated venues under the rotation schedule and pay service fees for the operation days only; and
 
(5) allowing operators to identify new operating venues for TC’s consideration and follow up if the venue management allows the food trucks to operate and provides appropriate supporting facilities and the pitch location will not cause obstruction to people and vehicle traffic.

     My reply to the question raised by the Hon Jimmy Ng is as follows:
 
(1) According to the financial statements submitted by the operators, the total gross revenue of 15 food trucks up to mid-October 2019 was $48.87 million with details tabulated below:

(2) TC assesses the business performance of the food trucks through the statements of accounts submitted by the operators rather than the people traffic at respective operating venues. The total gross revenue of 15 food trucks in operating venues up to mid-October 2019 was about $43.46 million with details tabulated below:

     As for events, the total gross revenue of 15 food trucks up to mid-October 2019 was about $5.41 million, in which $1.08 million came from food truck operation at tourism mega events organised by the Hong Kong Tourism Board (HKTB) and arranged by TC and $4.33 million from self-identified events.   
 
     In conclusion, the business performance of food trucks at individual venues and events varied greatly and was attributable to a number of factors including whether the pitch location in the operating venue is prominent, whether there are sufficient number of visitors at that venue and event, the business strategy of food truck operators, including number of operation day and whether operators have offered different types of food to match with the preference and consumption power of customers, etc.    
 
(3) Apart from arranging food trucks to participate in the tourism mega events organised by HKTB as mentioned above, one of the refinement measures of the Scheme is to allow food trucks to participate in self-identified events as long as the events are open to the public and obtained appropriate licences. Having regard to the fact that food trucks can cook at the spot and their huge size, it is crucial to ensure food safety and hygiene as well as not to cause obstruction to pedestrians or other vehicles when parked. In accordance with the licensing condition of Food Factory Licence (FFL) issued to food trucks, they can only operate at designated venues and events approved by the Government. The designated venues and events are assessed by relevant departments and considered suitable for food truck operation. If food trucks operate at private events (not open to the public) without licences, relevant departments cannot assess whether the premises and the events are suitable for food truck operation. However, if the events held in private premises are open to public and have obtained licences, food trucks are allowed to apply and participate through the existing application mechanism for self-identified events.
 
     Up to mid-October 2019, operators applied for operating in 90 self-identified events and approval had been granted to all applications. The nature of these events varies, including mega music concerts, carnivals, food festivals, mega contests such as tennis tournaments, car racing, yacht racing, running competition and charity walk, etc. Amongst all events, some were held at private premises/lots such as events held at the golf club, country club and outdoor area of shopping centre which were public events with licences. The mode of co-operation between operators and event organisers also varies. Some organisations would make bulk purchase of food from food trucks for their event participants while others would not collect service fee from the operators but just require them to arrange their own electricity for operation. Operators can decide whether to operate at these events having regard to their own business consideration.
 
(4) In view of the severe negative pressure faced by the Hong Kong economy, the Financial Secretary announced in August 2019 a package of measures to support enterprises (especially small and medium enterprises), to safeguard jobs and relieve people’s burden. Amongst which, food trucks will benefit from the waiver of the renewal fees for FFL and registered commercial vehicle licence and the vehicle examination fees (Note 3).  
 
     Regarding the rental fee payable to the operating venues, further to the 50 per cent rental concession offered by government venues to operating food trucks from October 2019 onwards for a period of six months, Ocean Park will also reduce the daily rental by nearly 30 per cent for the period from mid-November 2019 to end-March 2020. TC will continue to discuss with venue management to come up with other measures to help relieve the operating pressure of food trucks.
 
(5) Another refinement measure of the Scheme is to allow operators to opt whether to operate at the operating venues under the rotation schedule and pay service fees only for the operation days, which has already provided them greater room and flexibility in operation. At the same time, TC has explored with relevant organisations and departments over thirty new locations with tourism elements for food truck operation. Yet most of them, for example, pedestrian areas, beaches or piers fell through for various reasons such as the accommodation of food trucks will cause obstruction to people and vehicle traffic, there are too many restaurants in the proximity or there is no venue management to provide electricity and other supporting services, etc. TC will continue to look for new operating venues where practicable with a view to exploring more business for food trucks.
 
Note 1: The AsiaWorld-Expo provided two pitches for food truck operation at suitable events held in the venue since May 20, 2017. There were eight days of food truck operation for four events in this venue. The AsiaWorld-Expo does not participate in the Scheme during the extension period in light of its development plan.
 
Note 2: Tai Po Waterfront Park provided one pitch for food truck operation from July 22 to September 30, 2019 during the closure of its restaurant and kiosk.
 
Note 3: Wavier for renewal fees for FFL has taken effect from October 1, 2019, whereas waiver for registered commercial vehicles licences fees and vehicle examination fee will be effective from December 30, 2019 after the completion of vetting procedures at the Legislative Council.

     Following is a question by the Hon Tanya Chan and a written reply by the Secretary for the Environment, Mr Wong Kam-sing, in the Legislative Council today (November 20):

Question:

     After the Government's reduction of the concessions on the first registration tax for electric private cars (e-PCs) on April 1, 2017, there was a significant drop in the number of first registered e-PCs. On February 28, 2018, the Government introduced a "One-for-One Replacement" Scheme (Replacement Scheme) whereby a vehicle owner who scraps his old private car (PC) that meets the eligibility criteria and buys a new e-PC may enjoy a higher tax concession. On January 28 this year, the Government relaxed the eligibility criteria for the Replacement Scheme. On promoting the use of electric vehicles (EVs), will the Government inform this Council:

(1) of (i) the number of registered PCs, and (ii) the number of newly registered e-PCs, at the end of each month from January to October this year;

(2) of the (i) monthly and (ii) cumulative numbers of applications received and approved respectively, since the launch of the Replacement Scheme on February 28, 2018;

(3) of the number of PCs, as at January 28 this year when the eligibility criteria for the Replacement Scheme were relaxed, which met the new eligibility criteria; among such PCs, the number and percentage of those which have now been scrapped under the Scheme; the number of PCs meeting the eligibility criteria as at the 1st of this month;
 
(4) whether it knows the respective total numbers of (i) standard, (ii) medium and (iii) quick public EV chargers (chargers) throughout the territory as at the 1st of this month, with a breakdown by District Council district;
 
(5) as the Financial Secretary has indicated in this financial year's Budget that it will allocate $120 million to extend the public EV charging networks in government car parks, of the respective numbers of (i) standard, (ii) medium and (iii) quick chargers it has planned to install, with a breakdown by name of car park;
 
(6) whether it will make provision for setting up a dedicated fund for the installation of EV charging-enabling infrastructure in the public car parks under the Hong Kong Housing Authority, including the installation of more chargers and the replacement of the existing standard chargers by medium or quick chargers; if so, of the details; if not, the reasons for that;
 
(7) whether it will ask the MTR Corporation Limited to provide a certain number of chargers in each of its park-and-ride (PnR) car parks, so as to facilitate EV drivers' participation in the PnR Schemes; if so, of the details; if not, the reasons for that; and
 
(8) as the Government has planned to allocate $2 billion for launching a pilot scheme to subsidise the installation of EV charging-enabling infrastructure in car parks of eligible existing private residential buildings, and estimated that about 60 000 car parking spaces will be benefited, but as there were only about 12 000 EVs in the territory as at August this year, whether the Government has put in place measures to encourage vehicle owners of the car parks concerned to switch to e-PCs as soon as possible, so as to avoid wastage of resources?

Reply:

President,

     On February 28, 2018, the Government introduced the "One-for-One Replacement" Scheme (Replacement Scheme) to incentivise owners of private cars (PCs) to opt for electric vehicles (EVs) when they need to replace their old PCs. Under the Replacement Scheme, PC owners who scrap and de-register their eligible old PCs and then first register new electric PCs (e-PC) will enjoy a higher first registration tax (FRT) concession up to $250 000.
 
     To strike a better balance between promoting wider use of EVs and not increasing the overall number of PCs, the Government, after examining the views of the public on the Replacement Scheme, announced on January 28, 2019 that two of the three eligibility criteria for 'Old PC' would be relaxed with immediate effect:
 
(i) Ownership period: revised from the PC owner must have been the registered owner of the Old PC for "three years or more", without interruption, immediately prior to its de-registration to "18 months or more"; and
 
(ii) Licensed period: revised from the "Old PC", with or without interruption, must have been licensed for at least 20 months (i.e. 608 days or more) within the 24 months immediately before its de-registration to the 'Old PC', with or without interruption, must have been licensed for at least 10 months (i.e. 304 days or more) within the 12 months immediately before its de-registration.
 
     Regarding the criteria of vehicle age, the requirement of "the 'Old PC' must have been first registered in Hong Kong for at least six years" remains unchanged.

     Having consulted relevant bureaux and departments, my reply to the question raised by the Hon Tanya Chan is as follows:

(1) Relevant monthly figures on registered PCs and e-PCs from January to October 2019 are tabulated below:
 

Note: Government vehicles not included.

(2) Upon the launch of the Replacement Scheme, the Transport Department (TD) received 1 844 applications in total as at October 31, 2019. Among these applications, 1 785 have been approved, 42 are being processed and 17 have been rejected for not meeting eligibility criteria. Details are tabulated below:
 

Note: Including one case of withdrawal after approval of application.

(3) Since the corresponding computer system of the TD does not possess the statistical function to calculate the cumulative licensed period of PCs, the Government can provide neither the number of old PCs fulfilling all three requirements of the Replacement Scheme nor the number of old PCs scrapped under the Replacement Scheme.

     Besides, from January 28, 2019 to October 31, 2019, a total of 1 385 e-PCs were first registered under the Replacement Scheme, accounting for around 80 per cent of the cumulative approved applications since the launch of the Replacement Scheme.

(4) The respective figures on public EV chargers (including those provided at the Government and non-governmental car parks) as at the end of September 2019 are tabulated below by districts.
 

(5) The Government has allocated $120 million to expand the public EV charging network at government car parks in the coming three years. We plan to install over 1 000 medium chargers at car parks fully or partially open to the public under the TD, Government Property Agency, Leisure and Cultural Services Department, and Tourism Commission. Details are at the Annex.
 
(6) As recommended by the Hong Kong Planning Standards and Guidelines (HKPSG), the Hong Kong Housing Authority (HA) will continue to provide EV chargers at 30 per cent of PC-parking spaces in indoor car parks of newly built public housing developments. As for the remaining 70 per cent of PC-parking spaces, the HA will also install EV charging-enabling infrastructure (including distribution boxes, cables, conduits and trunkings) and reserve spaces for the installation of EV chargers as needed in future. Regarding outdoor car parks, although there is no recommendation made in the HKPSG on the provision of charging facilities, the HA will reserve sufficient power supply and underground ducts at outdoor parking spaces for the installation of charging facilities in future.
 
     The HA is proactively studying the impact of providing medium chargers in newly built public housing developments on the overall design of their power supply systems, and will strive to install EV charging facilities in accordance with relevant Government guidelines for EV charging and the HKPSG.

     For its existing car parks, the HA will provide, on demand and where technically feasible, EV charging facilities for monthly parking spaces without such facilities. Moreover, the HA has conducted a feasibility study on the addition of medium chargers at hourly parking spaces of existing HA car parks, and will retrofit medium chargers at some of these spaces if existing electricity loading permits. To ensure optimum use of resources, the HA will carry out the retrofitting works in phases and consider gradually increasing the number of medium chargers in suitable existing HA car parks according to the utilisation of the chargers.

(7) We wrote to various corporations including the Mass Transit Railway Corporation Limited (MTRCL) in November 2017, inviting them to install medium and quick EV chargers in their car parks, as well as upgrade their existing standard chargers to medium ones. The MTRCL replied in December the same year, stating that they would support the Government's policy of promoting the wider use of EVs. The MTRCL has started carrying out related works and devising planning. The Environmental Protection Department will continue to work with various corporations, including the MTRCL, to collaboratively advance the work concerned.
 
(8) To encourage PC owners to switch to EVs, the Government has implemented various measures over the past few years, including offering first registration tax concessions, introducing the Replacement Scheme, granting concessions on gross floor area for EV charging-enabling car parks in new buildings, expanding the public EV charging network, and establishing dedicated team and hotline to provide relevant information and technical support in setting up chargers.
 
     Whether EV charging facilities can be installed at private residential parking spaces is one of the key considerations for PC owners switching to EVs.  To further promote the steady development and popularisation of EVs in Hong Kong, the Government has earmarked $2 billion to launch a pilot scheme to subsidise existing private residential building car parks meeting prescribed criteria to install EV charging-enabling infrastructure. As a preliminary estimate, the subsidy scheme can provide about 60 000 existing private residential parking spaces to equip with the charging-enabling infrastructure within about three years.
 
     With the gradual technological advancement of e-PCs, more affordable e-PCs models with a long driving range are now available in the market. We therefore expect that the number of e-PCs will continue to grow. The abovementioned pilot scheme is a forward-looking measure to cater for the popularisation of e-PCs. Upon the launch of the scheme, we will review its progress and effectiveness in a timely manner in order to keep up with the development of promoting the use of EVs.

     Hong Kong Customs made the city's first-time seizure of suspected fenethylline in the form of 1.57 million tablets from a transshipment container on November 8 at the Kwai Chung Customhouse Cargo Examination Compound. With amphetamine as an active ingredient, which is controlled under the Dangerous Drugs Ordinance (DDO), the estimated seizure value of about $245 million is also its biggest case in terms of market price as detected by Hong Kong Customs.

     By means of risk assessment, Customs officers selected a transshipment seaborne container from Syria heading for Saudi Arabia via Hong Kong and the Mainland for inspection. The shipment manifest declared that it was a furniture product consignment. Upon inspection, Customs officers found the batch of suspected drugs concealed beneath the seat bases of 84 sofas.

     An investigation revealed that the drugs are not for the local market. It is believed that the drug trafficking syndicate made a circuitous routing of different stops in an attempt to escape from law enforcement agencies and transport the drugs from the Middle East and back to the same region.

     Fenethylline (or fenetylline) is usually in tablet form and was once used as medicine for mental or nervous system disorders in overseas countries. Being an addictive stimulant to the human central nervous system, it can cause euphoric intensity in users and has been exploited by criminal groups for profit-generating purposes.

     Risk assessment has all along been an effective strategy by Hong Kong Customs to intercept the import and transit movements of dangerous drugs in various channels. The department will continue to step up anti-narcotic efforts by risk assessment and intelligence analysis.

     Under the DDO, trafficking in a dangerous drug is a serious offence. The maximum penalty upon conviction is a fine of $5 million and life imprisonment.

     Members of the public may report any suspected drug trafficking activities to Customs' 24-hour hotline 2545 6182 or its dedicated crime-reporting email account (crimereport@customs.gov.hk).

        

     Following is a question by the Hon Christopher Cheung and a reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (November 20):

     Question:

     Earlier on, the House of Representatives of the United States (US) Congress passed the Hong Kong Human Rights and Democracy Act (the Act). The Act, if passed by the Senate and signed by the President, will become a law. Some members of the business sector are worried that the Act, once implemented, will inevitably affect the exchanges between Hong Kong and the US, make the US Government review the special treatment granted to Hong Kong, and destabilise Hong Kong's external trade relations and its status as an international financial centre. In this connection, will the Government inform this Council:

(1) of the latest assessment of the adverse impacts of the implementation of the Act on aspects such as Hong Kong's external trade relations, investment and listing of foreign-funded enterprises in Hong Kong, and importation of high technology products and know-how;

(2) whether it will step up efforts to lobby the political and business sectors of the US and explain to them the real situation of Hong Kong, so as to avoid the US authorities mistakenly making decisions that are unfavourable to Hong Kong; and

(3) of the contingency plans in place to reduce the impact on Hong Kong's economy to be brought about by the Act upon implementation?

Reply:

President,

     Thank you for the question raised by the Hon Christopher Cheung.

     Under "one country, two systems", the Basic Law confers on Hong Kong a unique status. Article 116 of the Basic Law stipulates that the Hong Kong Special Administrative Region (HKSAR) is a separate customs territory and Article 151 provides that Hong Kong may, using the name "Hong Kong, China", participate in international organisations such as the World Trade Organization (WTO) and the Asia-Pacific Economic Cooperation as a separate member.

     Therefore, Hong Kong's unique status is not granted unilaterally by any other country, but is conferred by the Basic Law. Hong Kong's unique status is well recognised and respected by the international community. Our economic and trade status is on par with other WTO members, and we are making use of this capacity in the international economic and trade arena to establish mutually beneficial relations with our trading partners around the world. 

     In respect to Hong Kong's return to the Motherland, the United States (US) enacted in 1992 the US-Hong Kong Policy Act (the Policy Act) which set out its policy and principled positions towards Hong Kong. The relevant law is a policy act of the US itself but not an international or bilateral agreement. Over the years, the US has been conducting economic and trade exchanges with Hong Kong in accordance with the Policy Act, has been respecting Hong Kong as a separate customs territory, and has on this basis established mutually beneficial bilateral economic and trade relations with Hong Kong. The US is Hong Kong’s second largest merchandise trading partner in the world, while Hong Kong is the US' tenth largest export market. According to the US’ statistics, for the past ten years, the US has been enjoying the largest trade surplus with Hong Kong among its many global trading partners, valued at US$33.8 billion in 2018 alone. In 2017, the US was the seventh major source of inward direct investment into Hong Kong and the ninth major destination of outward direct investment from Hong Kong. Moreover, there are 1 344 US companies in Hong Kong, of which 278 are regional headquarters. Separately, around 85 000 US citizens live in Hong Kong. The close and reciprocal bilateral relation between the two places is obvious.

     Therefore, passage of the Hong Kong Human Rights and Democracy Act (the Hong Kong Act) by the US Congress unilaterally is unnecessary and will certainly damage the mutually beneficial relationship, including the US' interests. The uncertainty so caused will inevitably affect the confidence of international investors and companies in Hong Kong. As for the actual impact on Hong Kong, it will depend on the specific measures and changes adopted by the US Administration after the Hong Kong Act is signed into law by the US President. The HKSAR Government will closely monitor development on the matter.

     As a matter of fact, safeguarding human rights and freedoms is a constitutional duty of the HKSAR Government. Article 4 of the Basic Law stipulates that the HKSAR shall safeguard the rights and freedoms of the residents of the HKSAR and of other persons in the Region in accordance with law. Human rights and freedoms in Hong Kong are fully protected by the Hong Kong Bill of Rights Ordinance and other legislation, in addition to the Basic Law. Provisions of the International Covenant on Civil and Political Rights as applied to Hong Kong remain in force. The position of the HKSAR Government is very clear: we oppose foreign legislatures interfering in any form in the internal affairs of the HKSAR.

     As for explanatory work, the HKSAR Government has been explaining to countries around the world the successful implementation of "one country, two systems" since our return to the Motherland, and promoting Hong Kong's unique status under the Basic Law and "one country, two systems" as well as our own various advantages. Such work is done through exchanges of information, reciprocal official visits, participation in international conferences, and the regular liaison of the overseas Economic and Trade Offices (ETOs). The Financial Secretary visited the US in October 2019, while I visited the US three times in September 2018, June and September 2019 respectively, during which we met with US government officials, Congressmen, think tanks as well as the business community there, and explained clearly Hong Kong's unique status and advantages. In respect of the Hong Kong Act, we have been explaining the situation in Hong Kong to relevant persons and organisations and actively clarifying misunderstandings, stressing that the changing of US; policies towards Hong Kong is unwarranted and will bring negative impact on the exchanges of people and businesses between the two places. The Chief Executive, myself and officers of the ETOs have written many times to various interlocutors in the US to explain clearly and in detail the HKSAR Government's position.

     The ETOs in Washington DC, New York and San Francisco have all along maintained regular contact with various sectors in the US, and they through meetings and other means have explained the actual and latest situation in Hong Kong. Among these, in the case of the ETO in Washington DC, the ETO has met over 200 political and business leaders in this year so far, including federal government officials responsible for Hong Kong affairs in the White House, Department of State, Department of Commerce and the US Trade Representative, as well as members and staffers of Congress.

     Looking ahead, the HKSAR Government will continue to strengthen external connections on the above aspects.

     Thank you, President.