June 10, 1998 (Wednesday)

Port and Maritime Board to Promote Shipping Industry

The Secretary for Economic Services, Mr Stephen Ip, said that the setting up of the Hong Kong Port and Maritime Board will help to further promote the development of Hong Kong's shipping industry.

The main function of the Board will be to co-ordinate and bring together the resources of the Government and the maritime sector to promote Hong Kong as an international shipping centre, support Hong Kong's economic development and create new job opportunities.

Speaking at a press conference held today (Wednesday), Mr Ip said that an important initiative in the Government's effort to promote the Hong Kong shipping industry is the expansion of the role of the Hong Kong Port Development Board (PDB) to strengthen the link between the Government and the shipping industry.

Mr Ip said, "The new Hong Kong Port and Maritime Board was officially established on 1 June 1998. All members are appointed by the Chief Executive for a period of two years. The chairman is Mr Peter Thompson, an experienced maritime lawyer and the former Port Development Board Chairman, and among the 21 members are people well known in the Hong Kong port and shipping community.

To discharge its functions effectively, two committees will be set up under the Port and Maritime Board: the Port Development Committee will be chaired by Mr Gerry Forsgate and it will focus on port and container terminal development; the Shipping Committee will be chaired by Mr Frank Tsao, a very experienced Hong Kong shipowner, and its membership will include other well known Hong Kong shipowners such as Mr George Chao, Mr M H Liang, Mr James Hughes-Hallett and other Port and Maritime Board members. The Committee will focus on improving the competitiveness of the Hong Kong shipping industry and promoting Hong Kong as an international shipping centre."

Mr Ip said that the reorganisation of the PDB underlined Government's commitment to support the Hong Kong shipping industry. He said that Hong Kong shipowners enjoyed a very high status in the international shipping sector. In terms of tonnage, Hong Kong shipowners control some 6 per cent of the merchant ships in the world, ranking fifth after Greece, Japan, Norway and the US.

"The main strength of Hong Kong as an international shipping centre is that we are not only a shipowning centre but we are also a very important ship management centre. Over 1 200 vessels plying round the world are managed by Hong Kong companies," Mr Ip added.

Mr Ip said that since the establishment of the independent Hong Kong Shipping Register in 1990, Hong Kong has been recognized by the international shipping sector as a first-rate ship registration centre. Ships registered in Hong Kong are considered as meeting the highest international standards set for safety and maintenance requirements. This means that ships flying the Hong Kong SAR flag are seldom intercepted by local port authorities for inspection of safety and maintenance standards. This provides a lot of convenience to shipowners and saves them operating costs when their ships enter or leave overseas ports. At present around 500 ships are registered in Hong Kong with a total tonnage of some six million tonnes.

Mr Ip said, "The shipping and maritime industry directly contributes 1.7 per cent of Hong Kong's GDP. It is one of the major industries in Hong Kong supporting the development of other trades, including import and export, financial, legal and insurance services.

"The Economic Services Bureau and the Marine Department have been undertaking a series of initiatives to support and encourage the development of Hong Kong's maritime industry, particularly in helping Hong Kong shipping companies to lower operating costs and increase their international competitiveness." These initiatives include:

1. lowering the cost for shipowners for registering their vessels in Hong Kong, which includes bringing safety and maintenance standards in line with international maritime convention requirements so that shipowners can save some cost when they build new ships or "re-flag" to Hong Kong. The Marine Department is currently studying the possibilities of further reducing the annual registration fees of ships and the fees for issuing seafarer certificates.

2. simplifying ship inspection procedures - since November last year, the Marine Department has waived the requirement for cargo ships not more than 10 years old to be surveyed by Marine Department surveyor when they first register in Hong Kong.

3. improving the computer software of the Registry of Shipping to provide both Chinese and English registration documents, including certificate of survey and application for registration forms, to facilitate and encourage local and Mainland of China ships to register in Hong Kong.

4. stepping up local and overseas publicity on Hong Kong's shipping register service - the Marine Department has set up a working group to contact local and overseas companies direct to attract them to register their ships in Hong Kong and manage their ships here.

5. reviewing, together with the Education and Manpower Bureau, the objective and operation of the Seamen's Training Center to provide more courses to cope with the modern needs of the Hong Kong port and the demand of the maritime industry.

6. reducing Hong Kong shipping companies' overseas tax burden by signing a memorandum of understanding on double taxation arrangement with the Mainland tax authorities and discussing with overseas tax jurisdictions arrangements to provide reciprocal exemption on freight tax.

"To implement the Government policy to promote the Hong Kong shipping industry, strengthening Hong Kong's position as an international shipping centre, and develop new shipping and related businesses in Hong Kong, the new Hong Kong Port and Maritime Board will be tasked to focus on the following priority areas:

1. To improve the competitiveness of the Hong Kong shipping industry in the Asian region and in the world by strengthening liaison between the Government and the shipping sector and providing a forum for the shipping industry to channel their views to the Government ;

2. To co-operate with the Hong Kong Shipowners Association and the Trade Development Council to carry out promotional campaigns in Mainland of China and overseas to attract more shipping companies to set up operations in Hong Kong;

3. To strengthen Hong Kong's status as a global shipping centre by encouraging international maritime organizations to establish Asian headquarters or offices in the territory, and together with the Hong Kong Shipowners Association seek to organize more international shipping and maritime activities; and

4. To promote Hong Kong's economic development and provide new employment opportunities through studies to fully utilize the territory's favorable business environment, such as good communication network and sound banking system, to promote Hong Kong as the Asian base for ship insurance, ship financing and arbitration.