Hong Kong Chief Executive Tung Chee-hwa (
The plan, announced by Tung at a press briefing, includes waivers for property, sewage and water charges, plus loan guarantees to protect half a million jobs in the tourism, entertainment, retailing and catering industries. The government will rebate HK$2.3 billion of salaries tax to encourage spending.
Like similar steps taken by Singapore a week ago, the measures aim to help small businesses and companies such as Cathay Pacific Airways Ltd, hotelier Shangri-La Asia Ltd and fast-food chain Cafe de Coral Holdings Ltd. People are staying home to avoid exposure to severe acute respiratory syndrome, or SARS, which has infected 1,458 people and killed 105 in the city in two months.
"It's already too late, the damage is already being done," said John Koh, a fund manager at Daiwa Asset Management Ltd, which runs US$200 million in Asia.
"How many companies are still around to apply for these benefits?" he said.
Tommy Cheung, a Legislative Council member representing the catering industry, said more than 100 restaurants have shut since the outbreak of the disease. The number of tourists visiting Hong Kong plunged by a third between mid-March and mid-April from a year earlier.
The Hang Seng Index fell 52.31, or 0.6 percent, to 8519.60, the lowest since Oct. 9, 1998, at the 4 pm market close. The index dropped 8.6 percent so far this year, the world's fourth worst-performing benchmark index behind those of India, Japan and Venezuela.
Tung has been criticized by opposition lawmakers for responding too slowly to the outbreak. China's leaders, who control the selection process that put Tung into his job, are questioning local politicians behind the scenes about his leadership abilities, the South China Morning Post reported.
Tung said he needed to balance the needs of business with the government's goal of reducing its deficit, forecast to be HK$68 billion in the year that began April 1.
"The measures seek to relieve the short-term impact of atypical pneumonia on our economy," Tung told a press briefing.
"They have also taken into account the medium-term need to make sure our budget is in balance," he said.
SARS has caught Hong Kong as the city was rebounding from its second recession in five years. The government said it will cut its previous 3 percent economic growth forecast for this year.
Hong Kong's budget deficit will be wider and growth will be slower this year because of SARS, Financial Secretary Antony Leung (
Some investors said reviving growth should be the government's priority.
"A one-off package is a good idea," said Andrew Salton, who helps manage $2.5 billion at Standard Life Investments Ltd.
"I wouldn't be concerned about the impact on the deficit," he said.
Under the government's plan, commercial rents in public housing estates will be reduced by as much as half for three months. Rates, water and sewage charges will be waived for up to four months for everyone, and license fees for the worst-affected industries will be scrapped for a year. Residents will each receive up to HK$3,000 via salaries tax rebates.
In the hotel and leisure industries, which have been worst-affected by the outbreak of the disease, the city will provide HK$3.5 billion in loans to pay salaries and protect jobs. The government also plans to create 21,500 temporary jobs and waive license fees for the transportation sector for a year.
DRONE CENTRAL: Taiwan aims to become Asia’s democratic hub for drones, with most exports focused on high-quality military-grade models, an official said Taiwan’s drone industry is expected to expand significantly by 2030, producing 100,000 units per month and exporting half of them, the Ministry of Economic Affairs said yesterday. Current drone production capacity is about 15,000 units per month, but the industry can quickly scale up as demand increases, Industrial Development Administration Director-General Chiou Chyou-huey (邱求慧) told a news conference in Taipei. Taiwan’s drone output grew 2.5-fold last year to NT$12.9 billion (US$408.3 million) under a government program to develop the uncrewed vehicle sector, he said. The Executive Yuan in October last year approved plans to invest NT$44.2 billion into domestic production of uncrewed aerial
A signaling system malfunction disrupted high-speed rail (HSR) services beginning at 8am today, with trains temporarily reduced to three northbound and three southbound trains per hour as authorities conduct inspections. The malfunction occurred on a section of track in Miaoli County during pre-operation checks early this morning, forcing northbound and southbound trains to use a single track, the HSR operator said. The regular schedule has been replaced with three hourly trains offering only nonreserved seating in each direction, stopping at every station, it said, adding that business class cars would still have reserved seating. Departures from terminal stations are scheduled at the top
VERBOSE VESSELS: A CGA cutter and a China Coast Guard exchanged verbal barbs for more than a day in Taiwanese-controlled waters before the Chinese vessel left The Taiwanese and Chinese coast guards had a standoff near the strategically located Pratas Islands (Dongsha Islands, 東沙群島) in the north of the South China Sea, the Coast Guard Administration (CGA) said yesterday. The two sides engaged in intense radio exchanges over sovereignty claims during the 33-hour standoff. China Coast Guard vessel 3501 eventually left the restricted waters, 26.6 nautical miles (49.2km) west of the Pratas Islands, at 5pm yesterday, the CGA said. Lying approximately between southern Taiwan and Hong Kong, the Taiwan-controlled Pratas are seen by some security experts as vulnerable to Chinese attack due to their distance — more than
WARNING: China should stop engaging in actions that undermine regional peace and stability, as it would only build resentment among people across the Strait, the CGA said China has deployed more than 100 navy, coast guard and other vessels in waters from the Yellow Sea to the South China Sea and the western Pacific since US President Donald Trump and Chinese President Xi Jinping (習近平) met in Beijing, National Security Council Secretary-General Joseph Wu (吳釗燮) said yesterday. “In this part of the world, #China is the one & only PROBLEM wrecking the #StatusQuo & threatening regional peace & stability,” Wu wrote on X. In a separate post, he said Beijing was coercing Taiwan’s maritime domain, calling it illegal and provocative, after the Coast Guard Administration (CGA) expelled a
RSS