Roundup: HK business communities widely support new government budget

Hong Kong business community has expressed their support for the 2005-2006 Government Budget presented to the Legislative Council by Hong Kong Financial Secretary Henry Tang Wednesday afternoon.

Hong Kong General Chamber of Commerce welcomed Tang's budget address.

Chamber Chairman Anthony Nightingale said while the operating budget remains in deficit, "it is encouraging that we are moving in the right direction to a balanced budget."

He said now that we've come out of the worst of our fiscal imbalance, it is important to ensure that we don't get into trouble."

Nightingale said "we like the current budget, because it is cautious and still has its 'eye on the ball' on controlling public expenditures and stabilizing the income stream."

He said the planned consultation paper on a Goods and Service Tax (GST) is a prudent step forward, since any decision by the community to have or not to have a GST in Hong Kong in the future must be based on thorough study and consultation.

Ian Fok Chun-wan, chairman of the Chinese General Chamber of Commerce, welcomed the measures to be taken by the government for improving the financial regulatory system, promoting the bond market, developing tourism and allocation of 500 million HK dollars (64.10 million US dollars) for small and medium enterprises.

He said more commerce and industry enterprises are expected to benefit from the new measures.

Kenneth Ting, chairman of the Federation of Hong Kong Industries, welcomed the proposal for abolition of the estate duty.

He said his federation and two other chambers of commerce had lobbied the government to abolish the estate duty two years ago. He said he believed that the move could stimulate the medium-term development of Hong Kong's financial sector and help promote Hong Kong's economic development.

Hong Kong Securities and Futures Commission said the new budget's plan is to enhance Hong Kong's position as an international financial center.

The commission pledged to be fully cooperative with the Hong Kong Special Administrative Region (HKSAR) government, in a bid to achieve the goals set by the new budget.

In response to the financial secretary's announcement in his budget speech that the government will provide additional funding of 500 million HK dollars (64.10 million US dollars) to support a wide-ranging program of new tourism initiatives and promotional activities in 2005 and 2006, Chairperson of the Hong Kong Tourism Board (HKTB) Selina Chow said "we warmly welcome the government's announcement which underlines the enormously strong growth potential of the tourism sector and its importance to Hong Kong's economy."

She said with the opening of several major new infrastructure projects, the HKTB will fully capitalize on this golden opportunity and introduce a brand new "Discover Hong Kong Year 2006" campaign to make the destination more appealing than ever to travelers worldwide, thereby cementing Hong Kong's reputation as the hottest, "must visit" destination in Asia.

Deloitte Touche Tohmatsu (Deloitte), a leading professional services provides, said here that "we are pleased to see that government costs are finally under control after 50 years of rise," said Yvonne Law, national chief knowledge officer of Deloitte.

She said that while the general conservative tone and direction of the budget was prudent, the government should have been able to move quicker on a number of initiatives brought forward from the prior year, including further implementation of the environmental 'users pay' system and the rationalization of government fees and charges.

However, Standard & Poor's Ratings Services believed that although Hong Kong's better-than-expected budget outturn is encouraging, public finances will remain vulnerable without broadening the revenue base.

Source: Xinhua