Policy Address

(F) Support the Local Economy

Support Small and Medium Enterprises

240. Hong Kong is home to some 360 000 SMEs, and they are the pillars of our economic development. To better cope with the city's economic restructuring, the Government will introduce the following 11 measures to enhance support for SMEs:

0. Extend the application period for the 80% Guarantee Product under the SME Financing Guarantee Scheme for two years, and further extend the principal moratorium arrangement for one year. The Government will also encourage banks to continue to adopt an accommodating and more flexible approach when processing loans by enterprises with sound repayment ability.

1. Provide concessions of fees and charges to alleviate pressure on business operations. The Government will reduce water and sewage charges for non-domestic accounts by 50%, subject to a monthly ceiling of $10,000 and $5,000 respectively per account. About 260 000 non-domestic accounts are expected to benefit from the measure. We will also reduce the trade effluent surcharge by 50%, which is expected to benefit about 35 000 businesses mainly in the catering industry. In addition, fees for the first issue or renewal of licences and permits, including those for hawkers, food businesses, agriculture and fisheries industries and liquor licences²⁰ will be waived, which is expected to benefit over 60 000 licensees. The above measures will be implemented for one year.

2. Considering that the original estimate for the Government's average annual capital works expenditure in the coming five years was about $120 billion, we will earmark an additional $30 billion in the next two to three years to increase expenditure on works projects driving sustained economic development, to support the local construction industry.