It is no surprise that the Chamber’s recent survey of members shows that the Covid-19 outbreak is having a devastating impact. The results show that businesses across all sectors are hurting and – as we have been advocating – many have implemented contingency plans, such as encouraging employees to work from home.
Thankfully, contingency measures have avoided large-scale layoffs. However, as no one knows how long this situation is going to last, longer-term we might start to see unemployment rising further if the outbreak continues to spread. You can read about our survey on page 44.
With businesses facing the most severe challenge since SARS, we are pleased that the Financial Secretary accepted our calls to roll out measures to ease their cash flow malady and stimulate the economy with his Budget address last month.
The Financial Secretary rightly pointed out the dangers of deficits, but as we have been saving for this proverbial rainy day, Hong Kong’s immediate needs must temporarily take precedence over the longer-term goal of balancing public finances. Dipping into our war chest is necessary if we are to safeguard jobs and people’s livelihoods.
The $18.3 billion package of concessions to specifically ease the pain of businesses was a decisive move. Providing a 100% guarantee for loans of up to $2 million under the SME Financing Guarantee Scheme will be particularly welcome, as many SMEs have told us they have been struggling to get financing. Lowering profits tax for companies, waiving business registration fees, reducing rental and utility fees, and other measures should also help businesses and safeguard jobs.
Looking back to when we were fighting SARS, we also laid plans to “relaunch” Hong Kong once the virus had been beaten, which helped the economy recover remarkably quickly. We also need a similar strategy to bounce back from Covid-19. Right now, it is hard to see the light at the end of the tunnel, but as the experience of SARS tempered our mettle, I am confident we can also emerge from the current crisis and hopefully recover just as quickly.
As part of our recovery process, we also need to introduce regulatory impact assessments (RIA) into the policymaking process to improve Hong Kong’s efficiency and competitiveness, as well as help minimize the risk of conflict and address people’s concerns early in the decision-making process.
On a final note, the Chamber’s CEO Shirley Yuen will be stepping down at the end of this month. For the record I would like to sincerely thank her for all her hard work and uncompromising dedication to serving the Chamber and members. The Chamber is certainly a much more vital and influential organization as a direct result of her unrelenting passion for the Chamber and its work. We wish her well in her new endeavours.