For Immediate Release
The Hong Kong General Chamber of Commerce (HKGCC) welcomes the various funding support by the Government to help SMEs and enhance the competitiveness of Hong Kong’s pillar industries, as presented by the Financial Secretary Paul MP Chan in his Budget Speech today.
The Chamber also welcomes targeted efforts to nurture the innovation and technology sectors, especially the biotech, artificial intelligence, smart city and fin-tech industries, as outlined in the Chief Executive’s Policy Address. Strong financial backing will lay a strong foundation on which these industries will be able to mature into future engines of economic growth.
HKGCC Chairman Stephen Ng said: “We welcome the Government playing the role as a ‘facilitator’ and a ‘promoter’ in developing our economy and enhancing our competitiveness, and look forward to the long-overdue exercise of reviewing regulatory and tax requirements, and removing red tape to improve our business-friendly environment,” he said.
“The Government’s commitment to develop the New Economy in Hong Kong by allocating $50 billion to the innovation and technology industry is commendable. However, the Government has to ensure that these funds will be wisely spent and hit the target. We do not want to see wastage or overly complicated application processes to access these funds so that they are poorly utilised,” said Ng.
At the same time, the Government must urgently examine current legislation to ensure that anachronistic laws do not derail these areas of growth. “Fin-tech and AI were not even conceived when many of our laws were written, so many businesses are running into extremely outdated laws when venturing into these new areas,” said Ng. The FS mentioned that the Government will review regulations and remove red tape to create a business friendly environment. “This is where the private sector can add enormous value and speed up the process, because they run into these problems all the time. In that regard, we continue to feel very strongly about the need for the Government to set up a working party involving representatives from the business community. ”
We also need to make sure, if we are prepared to invest billions of dollars into the “hardware” to build these new economic engines, that we have the “software” and brainpower to make them succeed.
While Hong Kong has the money to develop these new industries, what good will that money be if we cannot attract and nurture talent to grow the innovation and technology sectors into viable and commercial enterprises?” asked Chamber CEO Shirley Yuen. “We already have an ongoing acute talent shortage, so we need to be creative, innovative and flexible if we are to woo skills to Hong Kong. Nurturing talent is a given, and is a long-term vision that we support, but we need to address the ongoing acute talent shortages immediately, not five or ten years down the road.”
The Chamber believes that the one-off rebates and tax relief measures, while welcome, do not deliver as much benefit to businesses as cutting the corporate tax rate for a defined period, such as three years. “This would allow companies and investors to better plan their business strategies,” said Yuen.
Other welcomed initiatives to boost the economy are the $1.5 billion injection into the Dedicated Fund on Branding, Upgrading and Domestic Sales (BUD Fund), as well as raising the ceiling of the SME Export Marketing Fund from $200,000 to $400,000, a practical measure which HKGCC has been advocating to improve the Fund’s effectiveness for businesses. The Chamber is also encouraged by the Government’s efforts to broaden our financial service capabilities by growing the bond market in Hong Kong. Measures such as the Pilot Bond Grant Scheme, enhanced Qualifying Debt Instrument Scheme, continuance with Silver Bonds, and a government Green Bond, will help underpin Hong Kong’s standing as an international financial centre.
“While we are pleased that the Government is walking the talk on diversifying the economy and putting the financial backing behind it, we need to make sure that we also do not neglect the urgent need to improve our competitiveness by reviewing our tax competitiveness, conducting regulatory impact assessments (RIA) to make sure regulations are fit for purpose,” said Ng.
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