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SES's Speaking Note at the Special FC Meeting to Examine Draft Estimates of Expenditure 1998-99 Mr Chairman, I am glad to have this opportunity to highlight for Members some of the key developments in the coming financial year in the subject areas under my purview. Civil Aviation On civil aviation, the passenger throughput handled by the airport at Kai Tak in 1997 was about 28.5 million, about 3.4% less than that in 1996. This was mainly because of the downturn in in-bound tourism in recent months. On the other hand, the growth in cargo throughput handled by Kai Tak remained strong. It surged to a record level of around 1.8 million tonnes in 1997, which represented a 15.4% increase over the 1996 level. The Civil Aviation Department (CAD) forecast that the passenger and cargo throughput handled by Kai Tak this year until its closure on 6 July will be around 15.7 million passengers and 0.91 million tonnes of cargoes respectively. In 1997, CAD increased the runway capacity of Kai Tak from 30 to 31 movements per hour. Before the commissioning of the new Hong Kong International Airport (HKIA) at Chek Lap Kok, the CAD will continue to ensure the smooth and efficient operation of Kai Tak. In 1998-99, the CAD will step up their efforts to recruit and train more staff in air traffic control and air-ground communications, in order to meet the manpower requirements arising from the operation of the second runway of the new HKIA. The department will also introduce the Automatic Dependent Surveillance System using satellite and data-link to improve monitoring of aircraft movements outside radar coverage. The new system will help enhance flight safety and cope with increases in air traffic. New Airport The coming year will be an important year for Hong Kong's civil aviation as the new HKIA will come into operation on 6 July. The new HKIA will have modern facilities, additional capacity and great potential for further expansion. It will also be supported by good transportation arrangements including an Airport Railway. Construction of the first phase of the new airport is at the final stage. System testing and commissioning, staff training and trial programmes are underway. The Airport Authority, CAD, New Airport Projects Co-ordination Office and other relevant departments and airport operators have been working for months to plan for a smooth opening of the new airport, including the relocation exercise from Kai Tak. We are confident that with the efforts of all parties concerned, the new airport will be a world class airport on Day One of its operation. Air Services Agreements (ASAs) Under the Basic Law, acting under specific authorisations from the Central People's Government (CPG), the HKSAR Government may negotiate and conclude new ASAs for services between Hong Kong and its aviation partners. The opening of the new airport will provide ample opportunities for Hong Kong's air services to grow. To meet the growing traffic demand, we will seek to extend air links with new and existing partners. Hong Kong signed an ASA with Pakistan last month. Later today we will also sign an ASA with the Government of Bahrain. More ASAs are expected to be signed in the next few months. Port Development and Shipping Let me now turn to port development. The port plays a vital role in supporting Hong Kong's continued economic growth. In 1997 it handled about 14.5 million TEUs (twenty-foot equivalent units), representing a growth of nearly 8% over the previous year. Over ninety percent of South China's cargoes go through Hong Kong port and the rapid economic growth in Southern China has enabled us to retain our position as the world's largest container port for six years in a row. To sustain the economic growth in Hong Kong and South China, we will continue to provide sufficient port facilities to match forecast demand. We have recently completed the 1997 Port Cargo Forecasts providing an update of demand for new port facilities taking into account the historical growth rate, forecast of long term economic performance in Hong Kong, Mainland of China and our major markets such as the US and Europe, and new port developments across the borders. To meet this demand construction is scheduled to commence shortly on Container Terminal 9, and the Tuen Mun River Trade Terminal and new permanent mid-stream sites in Stonecutters Island will come into operation later this year. Our efforts to ensure maritime safety will continue through the establishment of three new traffic control centres and stepped up law enforcement at sea. We will undertake a number of initiatives to further enhance the status of Hong Kong as a world class shipping centre. These include simplification of registration procedures and a reduction in the cost of registering ships in Hong Kong, and the negotiation of reciprocal freight tax exemption arrangements with foreign tax administrations to reduce the overseas tax liability of Hong Kong ship operators. Telecommunications I wish to thank Members for appropriating funds of $6.7 billion last week (on 27 February 1998) for compensation for the early resolution of the Hong Kong Telecom International licence. The agreement between the Government and Hong Kong Telecom is a good deal for Hong Kong and will put Hong Kong forward on its track towards being the pre-eminent telecommunications hub in the Asia Pacific Region and this will assist in attracting the service industries underpinned by telecommunications. The Agreement provides the right environment to push Hong Kong forward on the road to the Information Age. As part of a redistribution of work of Bureaux, telecommunications, which has been a responsibility of this Bureau, will soon be dealt with by the Information Technology and Broadcasting Bureau. Postal Services Turning to postal matters. The Post Office operates on a trading fund basis. The increased financial and management flexibility that this affords is showing good results. During the year improvements have been made to services through increased mechanisation, additional evening deliveries for parcels, selective opening of post offices on Sundays and public holidays, and improvements to the Local Standing Order Services for philatelic products. The demand for philatelic products has stabilised at a high level, although down from the peak last year. The increased philatelic revenue has enabled the Post Office to maintain prices and to offer discounts for bulk rate users, providing assistance to businesses in Hong Kong. Energy Our priorities for the coming year are to conduct the first interim reviews of the Scheme of Control Agreements and a review of the next long-term financing plan of Hongkong Electric. With an eye on the longer term, and in the interests of promoting more competition in the energy sector, we will commission a consultancy study on competition in the electricity supply sector. On the safety front, we will introduce legislation to deter third party damage to underground electricity cables and overhead electricity lines. Agriculture and Fisheries Development We have been equally busy with agriculture and fisheries development over the past year. The Veterinary Surgeons Registration Ordinance was enacted. New regulations and measures were introduced to ensure that all imported birds and poultry are free of avian influenza. A consultancy study on arrangements for supporting the development of agriculture in Hong Kong was commissioned. On the fisheries side, we began a consultancy study on fisheries resources and fishing operations, increased from 3,500 to 5,500 the number of mainland fishermen deckhands employed by the fishing industry and began deployment of artificial reefs. In 1998-99, we will consider the recommendations of the studies on agricultural development and fisheries resources. In both cases, we will consult the affected parties and the public before drawing up policy proposals. We will enforce the recently-introduced controls on the importation of poultry and step up inspection of local poultry farms to ensure that poultry is free from disease. We will also bring forward new regulations to control dangerous dogs. Tourism Like most other economies in the region, we suffered a tourism downturn in 1997. According to the latest figures provided by the Hong Kong Tourist Association, total visitor arrivals in 1997 was some 10.4 million, 11.1% down over 1996 figures. The corresponding tourism receipts were down by 14.7% as compared with 1996 to about $75 billion. Notwithstanding this, Hong Kong was still the top tourist destination in the Asia-Pacific region with 25% more visitors than anywhere else in the region in 1997. In 1998, HKTA will launch a new image campaign to rejuvenate the destination image of Hong Kong and to re-stimulate tourists' desire to visit Hong Kong. The Association will capitalise on major events in Hong Kong such as the opening of our new airport in July to attract additional visitors to come to Hong Kong. In the longer term, HKTA will continue with a number of consultancy studies under the Tourism Development Fund to examine the feasibility of developing selected large-scale tourist attractions as well as to undertake projects to enhance existing tourist facilities in order to maintain the territory's competitiveness as the leading tourism destination in the region. We plan to set up a $100 million International Events Fund for HKTA to support the staging of major international events in Hong Kong. This will help attract additional visitors and promote Hong Kong as the "Events Capital of Asia". Meteorological Services The focus of meteorological services will be on ensuring smooth operation of meteorological facilities and provision of efficient services for the new Hong Kong International Airport and upgrading our services to the public. Mr Chairman, this is the end of my opening statement. We shall be happy to answer questions. (3 March 1998 at 9:00 am - 10:00 am) |