FS in Budget pledges to boost pillar industries and promote diversified economic development
Consolidating and enhancing the competitiveness of pillar industries and promoting diversified economic development is of the utmost importance to Hong Kong, the Financial Secretary, Mr Paul Chan, said today (February 22) in the 2017-18 Budget.
The Financial Secretary said the Government would continue to work with major trading and investment partners to open up more markets and remove market impediments to strengthen Hong Kong's status as a regional investment, financial and logistics hub.
To keep Hong Kong in line with the international trend, the Government will establish a Trade Single Window to provide a one-stop electronic platform for the lodging of trade documents, promote cross-border customs co-operation and expedite trade declaration and customs clearance with a view to facilitating trade.
On maritime services, Invest Hong Kong would strengthen promotion activities overseas and in the Mainland with a focus on Hong Kong's development as a regional maritime services hub, as well as a platform connecting the Mainland with the maritime industry in other parts of the world.
To boost the aviation industry, and following completion of the Hong Kong-Zhuhai-Macao Bridge, the Government will look at how to better connect Hong Kong and the Pearl River Delta region. Cross-boundary helicopter services will be considered to enhance connectivity.
To boost the aviation financing sector, the Government plans to introduce a bill into the Legislative Council in 2017 to amend the Inland Revenue Ordinance to offer tax concessions aimed at attracting aircraft leasing companies to Hong Kong.
To capitalise on the strong growth of cross-boundary e-commerce, the Airport Authority Hong Kong (AA) has reserved land on both airside and landside to support the growth in transshipment, cross-boundary e-commerce and high value-added air cargo business. The AA is striving to enhance the Hong Kong International Airport (HKIA)'s capacity to handle high-value temperature-controlled goods, including pharmaceuticals, with a view to enhancing the HKIA's competitive edge.
Mr Chan said Hong Kong's financial services, accounting for 18 per cent of gross domestic product (GDP), were a key driving force of steady economic growth.
The Securities and Futures Commission and the Hong Kong Exchanges and Clearing Limited were analysing the views received during the consultation last year on proposed enhancements to the decision-making and governance structure for listing regulation. Mr Chan said Hong Kong would continue to build on its status as the global offshore Renminbi (RMB) business hub and will explore with Mainland authorities ways to open up more two-way cross-border channels for RMB fund flows. To develop the asset and wealth management sectors, the Government proposes extending the profits tax exemption to onshore privately offered open-ended fund companies. This will help attract more funds to domicile in Hong Kong and build Hong Kong's fund manufacturing capabilities.
The Financial Secretary said that in this year's Policy Address, the Chief Executive announced that the Government will study the feasibility of a public annuity scheme, so as to help the elderly turn their assets into a stable monthly retirement income to reduce uncertainty. The Hong Kong Mortgage Corporation Limited has commenced the design and feasibility study of the proposal, and will furnish a report to its Board of Directors for consideration as soon as possible.
The tourism industry, which makes up 5 per cent of GDP and employs about 270 000 people, has been driving the growth of other related industries including retail, hotel and catering industries, and contributing significantly to Hong Kong's economy. The Financial Secretary announced a number of initiatives to boost the tourism industry, including the following three short-term measures:
(a) waiving the licence fees for 1 800 travel agents for one year;
(b) waiving the licence fees for over 2 000 hotels and guesthouses for one year; and
(c) waiving the licence fees for restaurants and hawkers and fees for restricted food permits for one year, benefiting 27 000 restaurants and operators.
He said the Hong Kong tourism industry would receive an additional $243 million in 2017-18 for initiatives in areas of work including: light shows and home-grown mega events; tourism projects with local characteristics and green tourism elements; transit, overnight and cruise tourism passengers; enhanced publicity in the Mainland and overseas; and training through the Travel Industry Council of Hong Kong to enhance service quality.
Mr Chan said with the global economic development gravity shifting towards the East in recent years, Mainland enterprises have been active in making investments overseas and tapping overseas markets. Hong Kong can capture business opportunities by capitalising on its quality professional services, socio-cultural advantages and rich international business experiences.
The Government would continue efforts to explore new markets for the local commercial sector and professionals, with the opening of a new Hong Kong Economic and Trade Office (HKETO) last year in Indonesia, and new HKETOs planned for Korea, India, Mexico, Russia, South Africa and the United Arab Emirates. The network of liaison offices in the Mainland will also be strengthened to provide a more even spread throughout the country.
"While strengthening our pillar industries, we will seize the opportunities and strongly support the development of industries over which we have advantages as well as emerging industries to further diversify our economy," the Financial Secretary said.
He said the Government fully supports the Hong Kong Productivity Council (HKPC) in facilitating industrial upgrading and transformation for a shift towards high value-added production. The Government has also commissioned the HKPC to establish an Inno Space to turn innovative and technological ideas into industrial designs or products, with a view to expanding the start-up culture in Hong Kong and supporting re-industrialisation.
The Financial Secretary said he would set up a new committee on innovation and technology (I&T) development and re-industrialisation to co-ordinate the I&T development and re‑industrialisation of Hong Kong. A new tax policy unit will also explore enhanced tax deductions for I&T expenditure.
Start-ups will continue to be supported, for example via the $2 billion Innovation and Technology Venture Fund. The Fund will inject new capital and energy into technology start-ups in Hong Kong.
To help the development of financial technologies (Fintech), the Hong Kong Monetary Authority is developing a new Faster Payment System to provide a round-the-clock inter-bank real‑time payment platform. The Government will also encourage the industry to make good use of the trial environment provided by the Fintech Supervisory Sandbox, so as to deliver more products and services based on different kinds of new technology.
On creative industries, Mr Chan said the vision is to shape Hong Kong into a trend-setting creative hub as well as a metropolis rich in arts and culture. Areas such as film, design, fashion, animation, advertising and music had all benefited from government funding support in the past.
He said the Government would sponsor a series of celebration events to showcase the robust development of Hong Kong's creative industries during the 20th anniversary of the establishment of the Hong Kong Special Administrative Region in 2017.
This would include design exhibitions in Hong Kong, overseas and in the Mainland; film festivals in 10 cities overseas; exhibitions on the works of Hong Kong comic artists and architecture; and fashion shows.
He said extra resources will also be allocated in 2017-18 to support more local art groups and artists to perform in major overseas and Mainland cities to showcase Hong Kong's cultural strength during the 20th anniversary year.
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