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Following is the transcript of a question-and-answer session by the Chief Executive, Mr Donald Tsang, at the Joint Business Community Luncheon at the Hong Kong Convention and Exhibition Centre today (October 17):
Question: Chief Executive, well first let me express our disappointment on the lack of measures to assist the SMEs and the commercial and industrial sector in your policy address. I'm sure you remember in the past 30 years, Hong Kong has gone through many economic storms, and each time it was the commercial and industrial sector which led Hong Kong to economic recovery. Now we are faced with the unprecedented global financial tsunami, banks already tighten their purse-strings, Hong Kong enterprises, especially the SMEs are all feeling the pinch. In fact many of them are now being put on a drip-feed. In fact this cannot sustain their businesses. What they actually need are treatment doses of glucose which can reinvigorate their operations with a healthy growth. Chief Executive, how could you help businesses, help them to obtain a credit guarantee so that they can secure loans to continue their operations? If companies are forced to pull down their shutters, like the one in Dongguan yesterday, there will be thousands of workers unemployed. This will occur again and again if no immediate assistance is given to them, and this will be a devastating blow to the Hong Kong economy. Thank you.
Chief Executive: I think Jeffrey has tried to pick up a question he failed to ask me yesterday at LegCo but there are rougher guys there that didn't give you a chance but still you...luckily you haven't got bananas with you, for me. But Jeffrey let me ask you, why do we pump money into the bank, why do we promise the bank, why do we guarantee all the deposits? We guarantee deposits in the banks so that they get more evenly spread in terms of deposits but at the same time to give them liquidity so they can lend to the small and medium-sized industries. This is exactly what we are trying to do. And also, Jeffrey, I write policy address every year. This year's is a particularly long one, it lasted for one and a half hours for me to finish reading it through. I try to cover the entire horizon, waterfront, but I cannot cover each and every thing. I owe you apologies I have not mentioned SME, but in my heart I know that is the strength and pillar of Hong Kong. That is why we're working on the financial system, not only helping the banks, the banks are only the intermediaries, the ultimate beneficiary of loosening up the money, the money strings onto the banks is because of the SMEs. My heart is with you but we must work together. There is also this SME credit guarantee scheme of the Government within which you can borrow money through the banking system with the Government's guarantee. At the moment there is certain restriction on the amount you're able to get and borrow from the scheme, there is a limitation of $1 million, and the overall grant the scheme can give you is $6 million each but most of that for equipment and capitalisation, but it's under discussion. I assure you, Jeffrey, a lot of things happening. We must continue to talk, you must tell us exactly what you want, and at the same time we must articulate your problems, because most of the problems are not here, they're right there in Guangdong Pearl River Delta, and I appreciate that, and I, as you know, we've been working flat out with you, with the Mainland authorities to ease up on the labour law and all the other things. And I'll certainly, certainly, continue to help you and help the industry as much as we can. But it must be a co-operative process, it must be a cordial process, we must work together. I will not blame you but don't blame me unnecessarily. A dialogue must be started, it must be on a good footing. I'm with you, please also come with me. Thank you.
Question: CE, I'm from the Chinese Manufacturers' Association. For those who don't know, the Chinese Manufacturers' Association is CMA in short. I'm going to ask you a simple question: We in CMA all agree with you in that if Hong Kong is going to have a minimum wage law, it should cover employees in all trades and all industries rather than restricted to cleaning workers or security guards. But however, such a law will be very complicated and it will involve time for preparation and involve many technical issues. In view of the complexity and time constraints, do you still believe it is feasible for you to prepare to introduce such a complicated bill into LegCo in the current session? Thank you.
Chief Executive: I do but there's a lot of work to be done. First of all when we started this process we were focusing on two particular trades - the security guarding trade and the cleaning workers. And in fact when we worked into it and we now come to a consensus with the labour sector and the employers sector that it is not feasible to confine it to these two trades. Because the definition itself will be difficult, and there's also a lot of migration between trades in the low-income group. So it would be unfair and create unnecessary injustices in the system if we just confine the legislation to these two trades. So the approach we have adopted to make it across the board has made the legislation a lot simpler, but it doesn't mean the end of the work. There's a lot more work to be done. First of all, while we draft the legislation we need input, input on statistical facts, on how the wage fares and how wage performed in various sectors. We have not completed statistical data yet. Second, we need to have a forum, whereby the labour sector, employees sector, academics, and people experienced in minimum wage setting get together and come up with a reasonable level of minimum wage that we apply across the board, and come up with a mechanism for reviewing it when necessary. That sort of forum already existed elsewhere and it worked well, for instance in United Kingdom. We're dealing with a much larger economy and a more complex industrial structure. So I believe it is feasible working three things together in tandem - drafting the law, gathering statistical data and forming this forum and forge a community consensus - all coming together into a bill, I hope, to be presented to the legislature in the current legislative year. We have worked for many years now for this, up to this point. I think a consensus is there. But we need a lot of compromises and we do not need fixated ideas on how it should be done. We must approach it with an open mind and the common good of society at the end of the day. We must have a system which will protect wages on one hand and will not undermine economic growth or reduction of job levels on the other. That balance must be struck. And I believe we can achieve that if we approach this issue with an open mind, with a compromising spirit and overall good of Hong Kong at heart.
Question: I'm Daniel Cheng on behalf of Federation of Hong Kong Industries. I would like to have a little different question on the environmental protection area. I'm very pleased to see that there are many environmental initiatives that'll be continued and starting some new ones. One of which I'm particularly interested in is the Kai Tak development to consider using a centralised chilling system to supply to the whole city's air-conditions. I believe that will be a great opportunity to do one step further, to actually have a whole Kai Tak eco-town, to merge all the other initiatives you have and bring it all together. For example, instead of using sea water to chill the chillers, perhaps we can consider reuse the waste water from that city and then recapture the heat and then you can release the water or use it for irrigation and have a total eco-package. I think that would be delighted for the international arena as well as the local city. Perhaps maybe some of these already in the works, I just like to make sure I put forth of this before it's being designed. Thank you.
Chief Executive: Well I in fact have a lot of paragraphs in the policy address regarding a reduction of air pollution and environmental protection. This is very much in my heart and this is very much part and parcel of our economic growth. I believe that the healthcare of the people on the one hand and economic progress go hand in hand in this community. We can no longer shy away from investment and innovation in this regard. Providing a centralised cooling system in the Kai Tak development is one of the things, but that's not the only thing. We are quite happy to go further in the overall planning of the Kai Tak area. This is a virgin territory, this is time for us to think big, and to do something novel, and in a way which we can be able to afford. If it's too expensive it's difficult. But I think these things work elsewhere, the sort of ideas you have using sewage system, sewage water, we also use recycling processes in the end, is feasible. And I agree with you, we should explore that, and please, please continue to talk with our planners in this. All I can say, they are very forthcoming. And even using now a centralised system for cooling in Kai Tak means a reduction of our energy consumption by 35% if you compare with air-cooling system, and by at least 20% if you use water-cooled system, the conventional type, so there you are, that would result in better, cleaner air and also reduced carbon emission.
Ladies and gentlemen, all I can say to you is, we have a rough time ahead, but we have enormous opportunities ahead of us as well. For this generation, yourselves, ourselves, have seen a crisis, ourselves, not too long ago, 1998, just exactly 10 years ago. But we are better equipped in our macro system, in our banking system, in our business structure, to handle this one. The important thing to remember is, as a result of our last crisis, Hong Kong came out much better, much stronger, as a metropolis, as an Asian financial centre, as a competitive global centre. This time round we should come out even better than before, as far as our ambition, aspiration as a leading centre of business and finance in the East Asian time zone. I've no doubt about it. It's up to us. I'll do my part, I'm sure you'll deliver yours. Thank you very much.
Ends/Friday, October 17, 2008
Issued at HKT 17:38
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