LC Paper No. CB(1) 500/98-99
(These minutes have been
seen by the Administration)

Ref: CB1/PL/ES/1

Legislative Council
Panel on Economic Services

Minutes of meeting held on
Tuesday,13 October 1998, at 11:45 am
in the Chamber of the Legislative Council Building

Members present :

Hon James TIEN Pei-chun, JP (Chairman)
Hon Fred LI Wah-ming (Deputy Chairman)
Hon Kenneth TING Woo-shou, JP
Hon LEE Wing-tat
Hon Eric LI Ka-cheung, JP
Hon CHEUNG Man-kwong
Hon HUI Cheung-ching
Hon Christine LOH
Hon CHAN Yuen-han
Hon Bernard CHAN
Hon CHAN Kam-lam
Hon SIN Chung-kai
Hon WONG Yung-kan
Hon Mrs Miriam LAU Kin-yee, JP
Hon Andrew CHENG Kar-foo

Member attending :

Hon CHOY So-yuk

Members absent :

Hon David CHU Yu-lin
Hon Martin LEE Chu-ming, SC, JP
Dr Hon David LI Kwok-po, JP
Hon MA Fung-kwok
Hon Ambrose CHEUNG Wing-sum, JP
Dr Hon Philip WONG Yu-hong
Hon Howard YOUNG, JP
Hon LAU Chin-shek, JP

Public officers attending :

Mr Stephen IP
Secretary for Economic Services

Mr KWAN Wing-wah
Deputy Secretary for Economic Services (1)

Ms Maria KWAN
Deputy Secretary for Economic Services (2)

Mr Richard YUEN
Deputy Secretary for Economic Services (3)

Mrs Lessie WEI
Director of Agriculture & Fisheries

Mr Albert LAM
Director of Civil Aviation

Mr H B Phillipson
Director of Electrical & Mechanical Services

Director of Marine

Mrs Elaine KOO
Acting Director of Hong Kong Observatory

Mr R Footman
Postmaster General

Mrs Amy CHAN
Executive Director, Hong Kong Tourist Association

Clerk in attendance :

Mr Andy LAU
Chief Assistant Secretary (1)6

Staff in attendance :

Ms Pauline NG
Assistant Secretary General 1

Mr Daniel HUI
Senior Assistant Secretary (1)5

I. Briefing by the Administration on the Chief Executive's Policy Address 1998

At the Chairman's invitation, the Secretary for Economic Services (SES) briefed members on the policy objectives for the Economic Services Bureau.

(Post-meeting note : A copy of the outline of SES's presentation was circulated to members vide LC Paper No. CB(1)327/98-99 dated 14 October 1998.)


2. Referring to the Government's commitment to developing world-class facilities such as a multi-media theme park, members noted from recent press reports that the Disneyland was considering building a theme park in Southeast Asia and that Hong Kong was one of the host cities under consideration. In view of the popularity of theme parks of this nature and the new jobs it would bring to Hong Kong, members enquired about the efforts put in by the Government in ensuring that Hong Kong would not lose out in the negotiation. They also enquired about the Government's policy in promoting projects of this nature which would be beneficial to Hong Kong's tourist industry and the economy as a whole. In response, SES assured members that the Administration would continue to do all it could to promote Hong Kong's tourist industry including the construction of a major theme park in Hong Kong. He also confirmed that the Government was supportive of tourism-related projects such as the Disneyland as well as other theme parks. It was however difficult for him to provide details relating to a specific project at this stage. As regards the Government's policy in granting land to a project of this nature, SES advised that depending on the merits of each case, the Administration would adopt a flexible approach in granting land to a project which required large area of land for development. He confirmed that the availability of land was not a problem for pursuing the plan to build theme parks in Hong Kong. The Planning, Environment and Lands Bureau had already been involved in the discussion on this subject.

3. Replying to the enquiry on the rationale for setting a quota for tourists from the Mainland whilst other visitors were not subject to the same restriction, SES explained that the quota requirement was mainly related to immigration control considerations. He informed members that there was flexibility in this policy and after consultation with the Mainland authorities, the quota had recently been increased to 1,500 people per day.

4. As regards measures to facilitate tourists visiting the Mainland through Hong Kong, SES advised that Hong Kong had reached agreement with the Guangdong authorities in waiving visa requirement on tourists visiting Shenzhen and Zhuhai from Hong Kong for 72 hours and the proposal would be implemented pending approval by the Central Government.

5. On the provision of additional exhibition facilities in Hong Kong, SES said that a committee chaired by himself was studying the need to build an exhibition centre in Hong Kong for large exhibits such as heavy machinery, cars etc. The findings of the study would be released upon completion of the study.

Shipping and Freight Services

6. Members pointed out that freight charges were becoming very expensive in Hong Kong which, in turn, would impose a threat to the development of air, sea and land cargo industries in Hong Kong. Some members enquired about the Government's policy in assisting the freight transport industry so that their operational costs could be reduced and the industry's competitiveness be enhanced. SES replied that the Administration was conducting a study of Port Back-up Facilities and Land Requirements which would shed light on the provision of more long term back up land for use by the terminal operators to improve overall efficiency and to lower the cost of operations. Moreover, there would be greater competitiveness in the market following the completion of Container Terminal No.9. The imminent completion of the River Trade Terminal in Tuen Mun would also provide an alternative and cheaper means of transporting containers between Hong Kong and the Pearl River Delta ports. SES further advised that a review of the charges on use of Public Cargo Working Areas (PCWA) would be completed soon. He believed that there would be constructive recommendations in the review in bringing down the charges of PCWA.

7. On land freight transportation, SES said that the Administration was discussing with the Shenzhen authorities on simplification of custom procedures to speed up cross border process. This would, in turn, cut down operational costs, and hence charges for land freight. As regards air cargo transportation, he confirmed that the Administration would continue to discuss with relevant parties on possible measures to help the industry.

8. Mr CHAN Kam-lam opined that in promoting Hong Kong as a major international shipping centre, there had to be adequate and quality ship repairing services available locally. He enquired about the Government's policy in the provision of ship repairing services in Hong Kong. The Deputy Secretary for Economic Services/3 acknowledged that Hong Kong had to maintain a certain level of ship repairing services. A sub-committee of the Port and Maritime Board was studying the issue in consultation with the ship repairing industry. He advised that the Administration was prepared to adopt a flexible approach in granting land for development of the ship repairing industry. He further pointed out that the industry had experienced difficulties in recruiting qualified technicians and the Administration would strengthen vocational training to assist this particular industry.

9. On the provision of facilities to improve local marine traffic control, the Director of Marine explained that the Marine Department would monitor the need to provide facilities including additional marine traffic control stations in order to ensure effective local marine traffic control.


10. Replying to the question on China Light and Power Company Limited (CLP)'s power station at Black Point (BP), SES advised that the construction of the seventh and eighth electricity generating units at BP power station were deferred as agreed between the Government and CLP. Members of the former LegCo Panel on Economic Services had been consulted on the deferral proposal. The main reason for the deferral of the electricity generating units was that CLP's reserved generating capacity had exceeded 50% of forecast demand. A review would be conducted in late 1999 to examine the timing for the construction of the delayed electricity generating units, having regard to the updated forecast demand available at the time. He further explained that BP power station was fuelled by natural gas which would bring less air pollution and was also in line with the trend of the international market.

11. On the question of whether the Administration would review the Scheme of Control Agreements (SCAs) with utility companies to prevent any massive staff lay-off programme on grounds of decreased profits, SES explained that the SCAs were legal contracts between the Government and the two power companies and the provisions therein could not be changed unilaterally. He informed members that a report on the mid-term review of the SCAs with the two power companies would be discussed at the Panel meeting to be held on 26 October 1998.

12. Referring to the role of the Government in the recent staff redeployment exercise in the Hong Kong and China Gas Company (HKCG) Limited, SES explained that utility companies did not require approval from the Government for its own staffing arrangements. However, in view of the fact that the recent staff deployment plans in HKCG was in its Maintenance Division and might have an impact on public safety, HKCG had therefore consulted the Electrical and Mechanical Services Department which had a responsibility under the Gas Safety Ordinance. The Department considered that the redeployment would not adversely affect public safety and hence did not raise any objection to the proposal.

13. As regards electricity charges, SES said that HKCG had recently announced that the towngas tariff would be frozen at the present level for 1999 and he hoped that the two power companies could follow suit in this respect.

Agriculture and Fisheries

14. As regards resources for research and development on agriculture-and-fisheries-related projects, SES acknowledged that research and development work was important to improve productivity of the agriculture and fisheries industries and the Administration would continue to put in resources in this area of work. The Director of Agriculture and Fisheries further advised that apart from the research farms and stations of the Agriculture and Fisheries Department which carried out research work on agriculture and fisheries, research institutes in local universities could apply to the Government funded Industry Support Fund for funding research projects including agriculture-and-fisheries-related projects. Currently several projects including two agriculture-related researches on improvement of chicken species and vaccine for certain livestock disease were being undertaken.

II Any other business

15. There being no other business, the meeting ended at 12:50 pm.

Legislative Council Secretariat
20 November 1998